banktime.com

It’s hard to be a Toyota owner these days. Take it from someone who is one. Between anxiously watching the news for information about the latest recalls and enduring the jibes of family and friends about Flintstone brakes and the likelihood that my car is going to start driving ME one of these days – and thanks, guys, but that’s not really that funny – it can really feel like your car is causing you more trouble than maybe it’s worth. But there’s one thing that you don’t need to lose sleep about at night, and that’s your insurance rates increasing. On the World Wide Web, speculation has been building for weeks that drivers of Toyotas might be facing the music when it comes time for their auto insurance policies to renew, since insurance companies might be able to make the claim that these vehicles are more likely to cause an incident that would trigger a claim. But experts are saying that this is a groundless fear.

A recall truthfully does not have any impact on the formulation or calculation of car insurance rates. Recalls stem from issues that the manufacturers have with the cars and/or trucks that they made. What insurers concern themselves with, on the other hand, is how many claims a certain model has associated with it. Does a certain make and model tend to cost the insurance company more money in claims paid out? If the answer is yes (such as in the case of a fancy, imported sports car with expensive parts and a tendency to attract speed demon drivers), then your insurance will go up for owning one of these cars. But your insurer will not hold you responsible if you have to file a claim as the result of a manufacturing defect, such as the kind that causes a recall. When you are in an accident, claims investigators will automatically check to see if the collision was the result of negligence on your part or the other driver’s part, or if some mechanical issue came into play. If the answer to that last one is yes, then your insurer would pursue a case against the manufacturer. In this example, that would be Toyota.

It’s expected at this point that Toyota will end up losing as much as two billion dollars in lost sales that are occurring as a result of their diminished reputation. Up until the end of January, Toyota had been on a years-long winning streak for having the best reputation and highest perceived reliability among American drivers. The recall of the Avalon, Corolla, Camry, Highlander, Matrix, RAV4, Sequoia, and Tundra models for sticking accelerators was a major blow, and then the highly publicized recall of many Prius hybrids due to malfunctioning brakes was the proverbial nail in the coffin. Toyota is also facing losses stemming from untold numbers of lawsuits from people who have crashed their cars as a result of the recalls, as well as those who have been unable to use their car while Toyota scrambled for a fix.