July 02, 2016

Airbags and Auto Insurance-Strangely, Not an Unhappy Relationship

As you’re likely aware, a massive recall of Takata airbags—affecting  34 million vehicles in the U.S.—has been taking place since the Japanese manufacturer announced defects in April 2013. This isn’t your run-of-the-mill defect. Six people have been killed from the shooting shrapnel that originates in the airbag’s inflator parts—usually upon impact, adding injury to likely injury.

As the owner of a Honda with the defective airbag, I was recently given the option by my Honda service organization to put my car in storage and replace it with an unlimited free rental until the time when a repair could be made. Now, I was a little slow to take them up on this deal due to the inconvenience of transferring cars (e.g., now I have no beach sticker all summer unless I offer lots of paperwork, money and work time to the fine officials at my Town Hall). But, eventually, with the threat of imminent death looming in front of me—right in front of me—I made the switch.

Bonus! I’m driving a large Dodge Journey that seats eight and provides me a much smoother ride than did my smaller 2011 Honda CR-V. I’m also not putting mileage or wear and tear on my own vehicle. Sweet! And Honda has no end date for when it will even receive new replacement airbags, nevermind complete the repair.

At Enterprise, where I retrieved my souped-up (in comparison) rental, I was advised to let my insurance company know that I was in a rental. OK. But it made me wonder how my insurance company (which happens to be USAA) did or did not react to the information that one of its insured drivers was behind the wheel of a potentially lethal vehicle. Why haven’t I heard from them?

                                   Source: Getty Images

So, I made the call, asked all my questions and here’s all the news that’s fit to print: First, there was no need to notify my insurer about the rental; it’s already covered under my policy. Second, apparently, the insurance industry doesn’t track recalls or adjust policies for insured drivers traveling in vehicles with recalled parts—even parts that can kill. The idea is that I’m already covered. That is, if damage occurs while driving the insured vehicle, no matter if it’s caused by a defective airbag, I’m covered under the existing policy. The insurer lists the manufacturer as the responsible party and we all move on from there.

Yet, this does not mean you can put off getting the recall fixed. Why not? Because car insurance rates are determined in part by the relative safety of a vehicle. If a recall has long-term affects on the safety of your car, your rates could be negatively impacted.

If you are worried that your car may be affected by the Takata recall, click here for a complete list of affected vehicles compiled by The National Highway Traffic Safety Administration (NHTSA). The site includes a way to enter your vehicle identification number, or VIN, to see if your car is included—in this or any other recall. The VIN can be found on your registration or on a plate on the dashboard visible through the windshield of most cars.

Your next step should be to contact a dealer that sells your make and model of car in order to get your airbag replaced. This could take awhile, however, as 30 million airbags are hard to come by.

NHTSA is working with manufacturers and Takata to prioritize which cars should get repaired first. Those in states with high humidity will have a higher priority, as will the older cars, since humidity and age are believed to contribute to the problems caused by the airbag defects.

The airbags will be replaced at no cost to the owner, even if the car is no longer under warranty. 

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