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Toyota Being Sued By 7 Additional Insurance Companies

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On: Mon, Jan 10, 2011 at 1:36PM | By: Sherry Christiansen

Toyota Being Sued By 7 Additional Insurance Companies

When any large company, such as Toyota, is sued it always makes the news headlines. If the lawsuit proceeds to trial and the company loses it's possible to tie up the awarding of any monetary settlement for years. However, if that same company decides to settle, many times it brings out the sharks who start swimming for their own piece of the potential prize. This appears to be what is happening to beleaguered Toyota as they attempt to close the books on the mounting lawsuits that have resulted from the recent acceleration recalls. Now 7 auto insurance companies are jumping on the lawsuit bandwagon with Allstate Insurance by going after Toyota with the full magnitude of their legal teams.

Among the insurance firms joining in on the lawsuit are American Automobile Insurance Co., Fireman's Fund Insurance Co., National Surety Corp., Ameriprise Insurance Co., IDS Property Casualty Insurance Co., Motorists Mutual Insurance Co., and American Hardware Mutual Insurance Co. All of this comes on the heels of Toyota agreeing to settle legal claims for one particular California family in the amount of $10 million. The family suffered three fatal deaths in an accident directly attributed to the acceleration problem found in Toyota cars. It was that specific incident which triggered the massive recall effort and set the stage for the lawsuits to follow.

Sadly for Toyota, the publicly announced settlement is the proverbial tip of the iceberg of their legal woes. The National Highway Traffic Safety Administration is looking into reports involving up to 89 Toyota-related deaths beginning in 2000. Since many of the insurance companies initially paid out on these claims, they are now seeking reimbursement from the Japan-based automaker. Allstate got the ball rolling with a $3 million claim against Toyota filed back in October. The 7 new litigants are seeking compensatory damages of at least $188,000. But wait, there’s more.

Toyota is marking its calendar for even more court appearances to the tune of a potential $10 billion in civil liability claims. To date, Toyota has brought back 5.4 million of their cars to fix floor mats that have resulted in a physical barrier to cause sticky gas pedals and acceleration surges. The company is also implementing the brake-override systems that could have prevented many of the accidents named in the lawsuits.

For its part, Toyota is still standing by their vehicles by steadfastly denying many allegations raised in these lawsuits. Toyota recently released an updated statement regarding their legal problems stating that “The latest lawsuits are without merit and that such disputes are common between insurers and automakers.”


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