TikTok's Kia Challenge Might Affect Your Insurance—Here's Why
The Kia Challenge is the result of a video that went viral in the summer of 2022, prompting teens to steal certain Kia and Hyundai models, often leaving them abandoned or destroyed. The video on the social media app, TikTok, shows viewers how to exploit a flaw in the vehicle's design, enabling them to steal the vehicle with little more than a USB cord and some know-how.
The media has highlighted how this challenge is far from a harmless prank and is affecting people's lives in big ways. One way it may affect people, even those who don't have their cars stolen, is an increase in auto insurance rates.
Why would the Kia Challenge prompt an increase in insurance rates? And, who exactly could it affect?
This article will discuss how widespread events (like a major increase in thefts) can change the car insurance landscape for everyone—even those who weren't directly affected by the event. First, we'll take a look at the details of the Kia Challenge. Then, we'll consider its effect on auto insurance.
Clearcover is committed to bringing clarity to car insurance. To stay true to our mission of keeping things transparent, keep in mind that this article is intended to serve as a general overview—all insurance companies and customers are unique, so it’s best to contact your insurer or insurance agent directly if you have questions about your policy.
Cities Report Thefts of Kia’s and Hyundai's Are up 767%
A group called the 'Kia Boyz' began exploiting a security vulnerability in some vehicles in 2021 in Milwaukee, Wisconsin. Stolen vehicles rose 172% in Milwaukee in 2021, with Kia's and Hyundai's being the most targeted.
When the Kia Challenge video started spreading across video sharing platforms in the summer of 2022, thefts of certain Kia and Hyundai models increased dramatically outside of Wisconsin as well.
Cities across the country have been reporting dramatic increases in stolen Kia and Hyundai vehicles since January 2022—like a 484% increase in Columbus, OH, a 767% increase in Chicago, IL, and a staggering 1,300% increase in St. Paul MN.
Vehicle Models Being Targeted in the Kia Challenge
The reason the vehicles are so easily stolen is due to a design flaw in the materials that were used to manufacture some models between 2011 and 2021. The Kia models that have the design flaw that's been exploited in the Kia Challenge are those made between 2011 and 2021. The Hyundai models being targeted for theft are those made between 2015 and 2021.
How the Kia Challenge Can Affect Your Car Insurance
If the chances of being stolen increase for a particular type of vehicle, more claims will likely be filed for that vehicle type. When more claims are filed for a particular vehicle type, insurance companies will often respond by charging higher rates to insure those vehicles, so you could see an increase in your insurance rate, even if your vehicle wasn’t stolen. Accordingly, events and trends like these can often have a ripple effect and impact more than the original claimants.
Similarly, if there are a lot of stolen vehicles in your area, the entire area may see an increase in insurance rates.
How Broad Is the Impact?
The complex nature of insurance means it'll be hard to know how much this particular incident will affect individuals' insurance rates. However, a class action lawsuit involving plaintiffs from multiple states has already been brought against the automakers. Referenced in the lawsuit is the allegation that Kia and Hyundai owners will pay higher insurance premiums.
When asked if this rash of thefts will have an impact on car insurance rates, here’s what Clearcover AVP of Insurance Product Seth Henderson had to say:
“Depending on the duration of the trend and the pervasiveness of it, it is entirely possible that customers may see an impact to their auto insurance rates as a result of this. At a high level, there are two primary drivers of claim cost: frequency and severity. An increase in the volume or frequency of claims can stress a company’s ability to pay claims without adjusting rates to account for the increased likelihood of loss. An increase in the cost to pay claims—or severity—can also provide substantial pressure on loss costs that necessitates adjusting rates to ensure that premiums adequately account for future loss. Given that the Kia Challenge is driving the frequency of thefts upward during a time of high external inflation, thereby exerting pressure on severity as well, it could potentially have an impact on future rates in the industry.
As for who is to be affected, the short answer is that it’s complicated. When you purchase a policy, you join a group (or pool) of people who share in the cost of claims. Companies raise rates when pressure exists on either frequency or severity—at times, both—to ensure that there is enough money to pay claims. In this sense, while your premium helps pay for other people’s claims, so too do their premiums help ensure that your claim will be paid if you have a loss. Depending on a multitude of factors, an individual may or may not be impacted by the rash of thefts resulting from the Kia Challenge.”
Here’s the Takeaway
The truth is, it isn't far-fetched to think the Kia Challenge could affect insurance rates for some people. Large events have ripple effects that can extend further than we might expect. The first people to be affected after a widespread incident are those directly involved, in this case, people who have had their cars stolen. Next would be people in the city or region of the spike in car thefts. The thinking here is that if there are more car thefts in an area, the rates for everyone in that area could potentially increase.
Along with the people in the immediate geographic area of the car thefts, people who own the same make and model of car as those being targeted could also potentially be susceptible to increased rates. This is because as insurance companies experience an increase in claims for that particular make and model, data will indicate that covering that type of vehicle now comes with a higher risk.
So, while we don't have a definitive answer as to whether or not this will affect insurance rates, it is certainly possible that it could.
When Vehicle Theft Can Raise Your Rates
Now, let's consider a few scenarios that could contribute to increased auto insurance rates. Remember, while we share these as generalities, your personal situation could be different.
Your Car Was Stolen
You will usually only be covered for theft if you have comprehensive coverage on your policy. Whether it is stolen by a teenager intrigued by the Kia Challenge or in a more traditional carjacking, your auto insurance rates could increase if your car is stolen.
You Own a Kia or a Hyundai
If the chances that a particular vehicle will be stolen increase, there are likely to be more claims filed for that type of vehicle. Quite often, when there are more claims filed for a particular type of vehicle, insurance companies may respond by charging higher rates for that vehicle. Thefts of Kia's and Hyundai's have skyrocketed because of the Kia challenge. If you own a Kia manufactured between 2011 and 2021 or Hyundai's manufactured between 2015 and 2021, you may see an increase in your rates.
A Large Number of Thefts Were Reported in Your Region
If a lot of cars are being stolen in your area, the insurance companies might raise the rates for all cars in the area. This means that even if your car is not a Kia or Hyundai, you may have to pay more for your car insurance. Every insurer handles this type of scenario in their own unique, proprietary way, but it typically will not be limited to a small geographic area. More likely, a region will consist of a significant geographic area.
Remember, while we can assume rates may increase for some people, your experience will vary.
What to Do If Your Car Is Stolen in the Kia Challenge
If you are the victim of theft as part of the invasive and disruptive Kia Challenge, we're so sorry that happened to you. Here are some action items to consider to get the help you need:
Call the Police
Unless someone is injured or you believe someone could be in danger, it is best to call your local non-emergency police line. This will allow them to begin an investigation into what happened and may help prevent similar thefts from happening in your area.
Document What Happened
In addition to calling the police, it is important to document what happened. This can include taking pictures of your car before and after it was stolen (remember, many stolen cars are turning up abandoned and destroyed), recording the make and model of your car, and noting the license plate number. Having this information on hand can help answer law enforcement questions and, if needed, track down your car more quickly.
File a Theft Claim with Your Insurance Company
Once you have reported the theft to the police, be sure to contact your insurance company to file a claim. You'll most likely be turning to your comprehensive car insurance coverage to recoup your losses if your car is stolen. Even if you don't think you have comprehensive coverage, call your insurer to report the incident.
Bring Clarity to Car Insurance with Clearcover
If you're concerned about how the Kia Challenge could impact your car insurance rates, we get it—insurance has been unclear, undecipherable, and unfair for too long.
At Clearcover, we're working to change that by simplifying car insurance and staying transparent with our customers. Get your quick, clear quote from Clearcover today.