Kia, Hyundai to Pay Up to $145 Million to Settle Lawsuit Over TikTok-Inspired Thefts

The agreement ends the class action lawsuit, but more legal issues remain for the automakers.

Chris Schafer
Written byChris Schafer
Chris Schafer
Chris SchaferSenior Editor
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  • 7+ years in business and financial services content

Chris is a seasoned writer/editor with past experience across myriad industries, including insurance, SAS, finance, Medicare, logistics, marketing/advertising, and many more.

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Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content
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John Leach
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John LeachSenior Insurance Copy Editor
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John leads Insurify’s copy desk, helping ensure the accuracy and readability of Insurify’s content. He’s a licensed agent specializing in home and car insurance topics.

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Published November 13, 2024 at 11:00 AM PST | Reading time: 2 minutes

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Automakers Kia and Hyundai have agreed in a California federal court to pay between $80 million and $145 million to settle a class action lawsuit. The suit stems from a defective ignition design that made some of the companies’ most popular vehicles easier to steal.

After a viral TikTok video by @robbierayyy exposed the security flaw in specific models, Kia and Hyundai thefts spiked in July 2022. The flaw allowed thieves to steal the vehicles by removing the steering column cover and using a USB plug to start the vehicle.

The ‘Kia Challenge’ went viral — and thefts increased

The vehicles in question also lacked a common anti-theft device called an immobilizer, which could have prevented the crimes. This ease of theft, shared on social media, sparked the so-called “Kia challenge.”

Thieves across the country posted their thefts of vulnerable vehicles on several social media platforms. Targeted vehicles included the following:

  • Hyundai Accent (2015–2021)

  • Hyundai Elantra (2015–2021)

  • Hyundai Kona (2015–2021)

  • Hyundai Santa Fe (2015–2021)

  • Hyundai Tucson (2015–2021)

  • Hyundai Veloster (2015–2018)

  • Kia Forte (2015–2021)

  • Kia Optima (2015–2021)

  • Kia Optima Hybrid (2015–2016)

  • Kia Rio (2015–2021)

  • Kia Sedona (2015–2021)

  • Kia Sorento (2015–2016)

  • Kia Soul (2015–2021)

  • Kia Sportage (2015–2021)

The frequency of thefts was so great that the Kia Optima, Hyundai Elantra, and Hyundai Sonata finished among the 10 most stolen vehicles in America in 2022. None of these vehicles were in the top 10 the year before.

Thefts of Hyundais and Kias alone rose 85% in Los Angeles in the wake of the challenge, according to the Associated Press.

Impact on auto insurance rates for Kia and Hyundai owners

The vulnerability of the targeted vehicles placed their owners in a difficult situation. Those who hadn’t had their vehicle stolen still found new difficulty in acquiring or maintaining insurance for their vulnerable vehicles.

Both Progressive and State Farm halted issuing new policies for the targeted vehicles in 2023, and the average insurance rate for the targeted vehicles climbed 55% between 2020 and 2023.

“We continue to insure existing customers who own these types of vehicles … We expect the limitations of these new business limits and pricing adjustments to continue changing as this issue evolves,” Progressive said in a statement at the time.

Automakers settle consolidated lawsuits

Kia and Hyundai faced more than three dozen class action lawsuits stemming from the thefts. The federal court in Los Angeles consolidated those lawsuits into a single case in 2022. The automakers agreed to settle the case in late October.

Under the terms of the settlement, Kia and Hyundai will spend at least $80 million and up to $145 million making payouts to the plaintiffs. Plaintiffs can receive $250 for new key fobs and other related upgrade expenses through the payouts.

If the total payouts fall below $80 million, existing claim amounts could be increased on a pro-rated basis.

What’s next? More lawsuits ahead

While this settlement brings an end to the consolidated class action lawsuits, Kia and Hyundai face additional lawsuits from auto insurers themselves.

Allstate, GEICO, Liberty Mutual, Nationwide, Progressive, State Farm, Travelers, and USAA filed a class action lawsuit in October 2023, seeking compensation for the claims the insurers paid out on vehicles that lacked the anti-theft technology.

Kia and Hyundai sought to have the case dismissed last November, but a judge rejected their request.

Chris Schafer
Chris SchaferSenior Editor

Chris is Insurify’s Senior Editor for home insurance. He’s a seasoned writer/editor with past experience across myriad industries, including insurance, SAS, finance, Medicare, logistics, marketing/advertising, and many more. He is passionate about breaking down complex subject material to make important information accessible to everyone. 

Chris began his career as a journalist, managing two weekly newspapers, then moving into marketing and content marketing roles. Before joining Insurify, Chris served as the content strategy manager at Siteimprove and as the content manager at Brandpoint, where he managed a team of content creators. 

Away from work, Chris is an active hockey player and proud father of two rambunctious little girls. Chris holds a Bachelor’s degree in English with a minor in mass communications from the University of Minnesota. 

Evelyn Pimplaskar
Edited byEvelyn PimplaskarEditor-in-Chief, Director of Content
Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content
  • 10+ years in insurance and personal finance content

  • 30+ years in media, PR, and content creation

Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.

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John Leach
Reviewed byJohn LeachSenior Insurance Copy Editor
Photo of an Insurify author
John LeachSenior Insurance Copy Editor
  • Licensed property and casualty insurance agent

  • 8+ years editing experience

John leads Insurify’s copy desk, helping ensure the accuracy and readability of Insurify’s content. He’s a licensed agent specializing in home and car insurance topics.

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