Imagine you are test-driving a $376,000 Lamborghini
Aventador.
You are zooming down the highway, enjoying the thrill of this
rare supercar, when you notice smoke and flames. You pull over, get
out of the car and watch helplessly as it burns to the ground. This
is exactly what happened to an
unlucky test driver
in California.
Thank goodness you don't drive a Lamborghini.
But do you drive a Jeep? A BMW? A Toyota? Car fires are more
frequent than you might imagine, and there are
investigations
opened almost monthly by safety regulators seeking their cause. For
example:
-
Power window switches
in 1.4 million late-model Toyota cars and SUVs may be the culprit
behind 161 reported fires. The National Highway Traffic Safety
Administration (NHTSA) has launched an "engineering analysis," a
precursor to a safety recall.
-
Gas-tank design
is the issue behind a NHTSA probe into the safety of 5.1 million
Jeep Grand Cherokees.
- A faulty water-pump circuit board prompted a recall of
thousands of late-model BMWs last year.
According to the National Fire Protection Association (NFPA), in
2010 there were 215,500 vehicle fires in the U.S., or one vehicle
fire every 146 seconds. Those fires killed 310 people, injured
almost 1,600 others and resulted in $1.4 billion in property
damage, the group says.
Cars burn for many reasons: accidents, faulty parts, even arson.
But just because you are not to blame for a fire doesn't mean your
insurance company will replace your smoking ruin.
The fire that isn't your fault
Almost half of vehicle fires are caused by mechanical failure or
malfunction, the NFPA says. That includes leaks, faulty brakes,
worn-out parts and even backfires. Electrical problems contributed
to 23 percent of fires. While you might think that most fires start
around the gas tanks and fuel lines, just 2 percent of fires
do.
If you have a very basic policy that offers only liability
coverage, you are not insured against fire even if a defect caused
the problem.
"Liability insurance only covers the damage that a driver causes
to other people and their property," says Andrew Schrage of the
personal finance website Money Crashers. "Therefore, if you have a
car that burns out due to a defect, you would need to pursue the
manufacturer in court."
Individuals will find that process time-consuming and expensive.
Insurance companies, on the other hand, know it well.
"If you have comprehensive coverage, you can make a claim
against your insurance company," says attorney Tom Simeone of
Simeone & Miller in Washington, D.C. "An insurance claim will
be quicker, less expensive and less burdensome than pursuing a
product liability case. Your insurance company can, in turn, file a
subrogation action against the automaker for the amount it pays
you."
It's not unheard of for an insurance company to go after an
automaker. For example, State Farm sued Ford numerous times over
defective ignition switches that resulted in car fires and payouts
to State Farm customers. State Farm said it had paid out more than
$440,000 involving 80 cars in California alone.
The fire that is your fault
Poor maintenance or improperly installed aftermarket equipment
similarly could leave you at risk even if you carry comprehensive
coverage.
For instance, your insurance company may be reluctant to pay if
you have not disclosed your modifications ahead of time, says
CarInsurance.com consumer analyst Penny Gusner. (See "When your
hybrid burns down your house.")
The insurer also may refuse to pay if you have failed to
exercise reasonable care, as one holiday-minded driver found out
after a Christmas wreath caught fire.
But most drivers will simply have to pay their deductibles and
get on with life. Typically, comprehensive insurance claims don't
affect your rates unless you have made several of them. Collision
claims are more likely to affect your rates.
Some fire claims might be paid under collision, Gusner says, "if
your car caught fire after an accident, such as a rollover. But in
most cases it is comprehensive that protects against fires."
Rollovers and collisions were blamed in only 3 percent of fires,
the NFPA says.
What about arson?
In 2010, roughly 14,000 car fires were intentionally set,
according to the NFPA, resulting in $90 million in damage.
People burn cars for a number of reasons. They might be covering
up a crime, destroying a joy ride or, in many cases, trying to get
out of a car loan they can no longer afford (a practice known in
the insurance industry as an "owner give-up").
If you are the victim of a legitimate case of arson, you are
covered under comprehensive coverage if you have it, minus your
deductible. If the arsonist turns out to be your angry spouse,
though, you will have to take it up in divorce court. Most insurers
will not cover intentional damage caused by a family member, Gusner
says.
What to do if your car is on fire
The NFPA and the AAA suggest the following if you find yourself
in a burning car:
- Stop. Get off the road as soon as safely possible and turn
off the ignition. Turning off the ignition stops the flow of
gasoline.
- Get out. When you have safely exited the vehicle, move at
least 100 feet away. Exploding cars are mainly the stuff of
movies, but a burning car throws off toxic fumes.
- Call 911. Let the professionals handle the fire. Do not
attempt to extinguish it yourself.