Insurer Asks Toyota to Repay Pedal Claims

Toyota is being asked by the insurers State Farm to reimburse them for claims paid out on crashes involving the automakers' vehicles where unintended acceleration came into play.

USA Today's Sharon Silke Carty writes that America's largest auto insurer's demand for subrogation could wind up costing Toyota between $20 and $30 million.

Subrogation — whereby an outside party is assigned to remedy a claim — is not uncommon between auto companies and insurers, Toyota told USA Today.

And what is in it for State Farm customers who filed claims on their Toyotas? They could be refunded any insurance deductibles they paid.

But don't look for that check any time soon — making a determination on which claims could be blamed on unwarranted acceleration "could take months," a State Farm representative told the paper.

And if the automaker refuses to pay State Farm — or any other insurers who follow suit seeking similar relief — insurance companies could wind up charging higher rates to cover Toyota vehicles, which (an insurance industry spokesman told USA Today) have generally been cheaper to insure because of their record of safety and reliability.

For more on this story:

State Farm Asks Toyota to Repay Acceleration Claims (USA Today, 4.12.10).