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35
YEARS
Hail Damage from NE Storm that Insurers Now Call a Catastrophe Could Top $80 Million by Steve Jordon / World-Herald staff writer / Omaha World-Herald
VOL. 6 ISSUE 11 AUGUST 2017
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chip paint and break the lens on his right headlight—and cracks arrayed like a spider web in his windshield. “I couldn’t believe it,” said Seitz, who was at a drive-thru insurance claims office in La Vista this week. A claims adjuster had just given him a $7,000 check, which he’ll use to fix the CR-V. “I like this car,” Seitz said. The check was Seitz’s piece of what insurance companies now call the June 29 Omaha hail property damage catastrophe, setting in motion a tedious
Takata Airbag Recall Expands by 2.7M More Vehicles, Ca2SO4 Desiccant is Now Suspect in Certain Inflators by Autobody News Staff
mechanism is to prevent the propellant, largely ammonium nitrate, from becoming hydrated and therefore unstable. In chemical terms instability can affect the burn rate of the compounds and behave unpredicably, leading to malfunction. Environmental moisture, high temperatures, and age contribute to the process that can disastrously fragment the airbags’ inflator mechanism. NHTSA has determined the root cause of the inflator casing shattering problem is airbags that use ammonium nitrate-based propellent without a reliable chemical drying agent, i.e., without an effective desiccant. The propellant oxidizes hydrated fuel granules and wafers explosively, causing the inflator’s casing to rupture and fire the shattered fragments with sometimes lethal velocity.
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In a dramatic expansion of what is already the largest automotive recall in history, Takata Corp.—which recently filed for bankruptcy protection—has just added 2.7 million vehicles to the total. Vehicles made by Ford, Nissan and Mazda are using a type of airbag inflator including a desiccant, or drying agent, that previously was thought to be safe. Commonly encountered desiccants are solids that absorb water. See Hail Damage, Page 18 They are frequently used in packaged foods to retain o m c l e e s w ws g this iss reade crispness and are in e ue N in MN Commerce Department Fines Two in rs y ead no way explosive in r a their own right. Insurance Companies for Failure to However the Settle Claims desiccant’s role Even when the driver won’t cooper- even worse if in the Takata ate, the insurance company must pay the at-fault driSee Takata Adds to Recall, Page 32 airbag inflation claim. ver’s insurance Minnesota Commerce Commis- company tries Mahalo Nui Loa Mahal sioner Mike Rothman announced to stonewall and State Insurance Regulator Expresses Openthat his agency has fined two insurdeny your claim, ness to Ideas Implemented in Other States ance companies for violating state which is not acceptby John Yoswick consumer protection laws by refusing able.” to insurers. Bob Redding, the Autoto pay auto accident claims for damWhen someone files a motive Service Association lobbyist age caused by drivers they insured. damage claim with another driver’s Collision repair shops and associawho serves as vice-chairman of the CIC “When there’s damage from a insurer, it is known as a third-party tions often express frustration in trycommittee, said the U.S. House has apcrash caused by the other driver, you claim. ing to work with their state proved legislation overturning must be treated fairly by that driver’s In recent consent orders with the insurance regulators on isthe antitrust exemption for insurance company,” said Rothman, Commerce Department, American sues related to steering, use health insurance companies. whose agency regulates the insurFamily Mutual Insurance Company of non-OEM parts or other But, he said, it was too early ance industry. “Getting hit by another was fined $25,000 and Bristol West insurance claims practices at that time to know if the car is a terrible experience, but it gets they consider unfair or illeSenate would also include See MN Commerce Department, Page 22 that in its healthcare legislagal. But presentations and discussions at a recent Colli- Brooke Stringer of tion, nor if lawmakers would sion Industry Conference the National Associ- have interest in also ending ation of Insurance the antitrust exemption for (CIC) on state or federal regCommissioners ulation of the insurance inproperty-casualty insurers. (NAIC) said NAIC dustry may offer an example supports state rather He also said the Republiof how to approach getting than federal regula- can-controlled Congress has tion of insurance also expressed plans to roll regulators to act. The CIC “Governmental Com- back some financial industry regulamittee” began its presentation with a tions (known as the Dodd-Frank leglook at the prospect of repealing the islation) passed in response to the 1945 McCarran-Ferguson Act, the 2007–08 financial crisis. Among federal antitrust exemption granted See Insurance Regulator, Page 49 Dick Seitz (Class of ‘61) and his Cathedral High School buddies were at Mama’s Pizza on Saddle Creek Road [in Omaha, NE] on the evening of June 29—telling stories of the old days—when they heard what sounded like firecrackers outside. The noise actually came from hailstones, some as big as 4 inches in diameter. Within a few minutes, Seitz’s 2010 Honda CR-V had dozens of dings and dents—one of them deep enough to
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