Insurance question.

Kinja'd!!! "Rainbow" (rainbeaux)
09/18/2019 at 08:24 • Filed to: None

Kinja'd!!!0 Kinja'd!!! 31

My dad’s friend has a question that neither of us knows the answer to, so he asked me to post it here:

I need advice. Daughter has a 2014 Hyundai Veloster, not even 71,000 miles and the turbo went and therefore threw metal into the engine, destroying the engine. She still owes over 11,000 (4 years) on it but since she’s not the original owner, the warranty is not in affect. Has anyone had any experience here? If she gets a beater car until the loan is paid off, will she still need to carry full insurance on the one that literally won’t run? I’m guessing yes because the loan holder won’t know it’s dead. Any recourse with Hyundai? Anyone have a line on a something reliable for 1500? Any help is appreciated!


DISCUSSION (31)


Kinja'd!!! Nibby > Rainbow
09/18/2019 at 08:31

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ford tempo


Kinja'd!!! OmerCarrothers333 > Rainbow
09/18/2019 at 08:34

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The power train warranty should still be in effect, regardless of who the owner is.


Kinja'd!!! Monkey B > Rainbow
09/18/2019 at 08:35

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if there is a loan then it needs to be fully insured, the bank will add expensive insurance when they find out insurance is dropped .

Talk to the bank, they may take a short sale or take less given the situation. The car has value, just not the pay off...so worst case scenario let it go and just owe the bank the negative equity.


Kinja'd!!! pip bip - choose Corrour > Rainbow
09/18/2019 at 08:38

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talk to service manager at a Hyundai dealer, see if there is any chance of goodwill?


Kinja'd!!! diplodicus forgot his password > OmerCarrothers333
09/18/2019 at 08:38

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I assumed the same thing, but hyundai clearly states that is not the case for the 10yr 100,000 mile powertrain warranty. https://www.hyundaiusa.com/assurance/america-best-warranty.aspx#1


Kinja'd!!! MKULTRA1982(ConCrustyBrick) > Rainbow
09/18/2019 at 08:42

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I speak from experience: you cannot buy a reliable car for 1500$ that is safe.  


Kinja'd!!! MKULTRA1982(ConCrustyBrick) > Monkey B
09/18/2019 at 08:44

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This seems insane, paying for insurance on a car that does not move. 


Kinja'd!!! My X-type is too a real Jaguar > Rainbow
09/18/2019 at 08:52

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No chance of a Junkyard Engine and installation for $1500? That would be the best route. They aren’t going for much on Copart, I’d call around to the late model salvage yards, and then find a mechanic to do the swap.  I’ll bet you can do that for less than $2000.


Kinja'd!!! Snuze: Needs another Swede > Rainbow
09/18/2019 at 08:53

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A few things - how did they arrive at the diagnosis of dead engine? I’ve dealt with a few blow’d up turbos before and never seen one throw metal into the engine and kill it completely. And I’ve seen impellers come apart and basically grind themselves into dust. I’m not saying it isn’t dead, but I’d get a second opinion on it. A turbo replacement is relatively cheap compared to a new engine.

It might be worth calling Hyundai and pestering them about it, especially if there’s a known issue, i.e. hit the message boards and see if it’s a common problem with that engine in Velosters or other Hyundai products. I had a friend who’s Ram EcoDiesel died like 3,000 miles after his warranty was up and the dealer wanted like $14k to put a new engine in it . In his case there was a known oiling issue, so he just kept pestering them, and working his way up the chain at FCA. Eventually he e-mailed the office of the President of FCA USA and upon politely explaining his situation, they worked something out and he got a pro-rated rate, it was only like $1,400.  


Kinja'd!!! Arrivederci > Rainbow
09/18/2019 at 08:56

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Firstly, since there is a lien on the car, she’s required to carry insurance on it until it’s paid off. If the bank determines there’s a lapse, they’ll add forced placed insurance and hit you with a ton of fees.

Here’s what I would do:

1) Visit your local Hyundai service advisor and explain what happened. Ask if they would be willing to escalate to Hyundai corporate as goodwill. Unlikely that Hyundai would cover it in full, but they might be willing to meet 50/50 on the cost of the replacement. If the service advisor gives you the heave-ho, just go straight to Hyundai corporate. If you can prove routine dealer service, that’ll be in your favor.

2) If Hyundai fails you and you haven’t already, talk to a local repair shop. Quick search shows these engines aren’t too expensive used, maybe $1000-1200. It’ll probably cost another $1k to install, but I’d rather have the Veloster running than a beater that only saves $500 or so versus the repair .

3) If you can’t replace the engine and decide on the beater route, talk to the bank about the Veloster. See if they’d allow a reduction in insurance if you place it in storage somewhere, taking it off the road. They may also be able to help with other options to get rid of the Veloster and roll the negative equity into something else that’s already cheap and will run for a long time (like a used Fit).


Kinja'd!!! someassemblyrequired > Rainbow
09/18/2019 at 08:57

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Engine swap time. Unless it was bought at a Hyundai dealer, in which case the 10 year warranty still applies.


Kinja'd!!! Mercedes Streeter > Rainbow
09/18/2019 at 09:04

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I would try to find a dealer that would honor the warranty anyway. Some MB dealerships have done so with smarts when people got blown engines outside of their warranty coverage. They may have to pester Hyundai corporate about it as well. I’d explain the situation, express a desire to keep the car on the road, and see what they can do.

Next, I’d see if I can get a used engine installed for cheap.

If all that doesn’t work, I would notify the bank of the situation and they may work out a deal.

But I’d say at no point should they just have that car sitting there, costing money but unable to drive.

As for insurance? The official answer is they need it per the contract. Unofficially? I have my 453 uninsured while it’s stored during the winter, the bank doesn’t seem to know or care even though my contract said I needed it. But not all banks are as lazy or as incompetent, so there’s that.


Kinja'd!!! AMGtech - now with more recalls! > Rainbow
09/18/2019 at 09:18

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I’ll second what Snuze and A rrivederci said. And add that maybe insurance will cover repairs if Hyundai doesn't help out. I've seen insurance cover things like this before. More than once, more than one insurance company. But this exact situation is why goodwill repairs exist.


Kinja'd!!! E90M3 > Rainbow
09/18/2019 at 09:23

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Sure the turbo went? My sister has a 2012 Sona ta that lunched the engine, and that engine was replaced by Hyundai for free. My family is the second owner, and it was still covered, but my dad did buy it as a CPO car. The 2012 Sonata did have a recall, so like others have said, see what Hyundai will do.

If they won’t do anything , put a new engine in it; long term that’s a lot better bet than some $2k beater. A car is something where you have to look at the long term pros and cons, not just a month or two out. 


Kinja'd!!! wafflesnfalafel > Rainbow
09/18/2019 at 09:25

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Y es, the bank wants to be protected. Once they fail to get confirmation of primary insurance they will put “forced placed” coverage on the vehicle for their interest in the car, (not you friend’s mind you, just theirs,) and charge her for it and that coverage is not inexpensive. It might be cheaper in the long run for her to get an unsupported personal loan and pay off the car with that even if that interest rate is worse just so she doesn’t have to support the insurance on the car if it’s just going to be junked anyways.


Kinja'd!!! DipodomysDeserti > OmerCarrothers333
09/18/2019 at 09:28

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On a normal car. This is a POS Hyundai.


Kinja'd!!! Future next gen S2000 owner > OmerCarrothers333
09/18/2019 at 09:59

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Hyundai doesn’t transfer their warranty. The transferable part is more in line with others, 5 years 60K.


Kinja'd!!! Future next gen S2000 owner > Rainbow
09/18/2019 at 10:00

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Store it and get storage insurance. It’s cheap. Should qualify. The other option is to do a motor rebuild or swap . It wouldn’t be cheap but may be the cheaper option.


Kinja'd!!! Future next gen S2000 owner > MKULTRA1982(ConCrustyBrick)
09/18/2019 at 10:01

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It’s part of the contract everyone signs. This is an outlier case.


Kinja'd!!! facw > Rainbow
09/18/2019 at 11:49

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So you aren’t going to be able to mess around with the insurance, so other options:

See if Hyundai will give a little on the warranty and do a cheaper repair. It can happen.

Get an indie shop to fix/replace the engine

Trade it in and roll the debt in into the new loan

Take out another loan to pay off this one

You can of course ask the bank for other options, but they probably won’t be especially accommodating.

Personally, I think fixing the car is the way to go. She needs a car (presumably) and you won’t be able to get anything remotely as good, even for the cost of an engine replacement. Meanwhile if you don’t fix it, it’ll be getting less valuable by the day, and possibly costing you storage fees as well. It seems like a bad idea to just keep it around broken until the loan is paid off (unless you can pay it off right away).


Kinja'd!!! whatisthatsound > Monkey B
09/18/2019 at 13:25

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I am not sure I agree at least through USAA. I've had the car financed through them, gone on deployment and reduced insurance to non-driving status and paid pennies a month. 


Kinja'd!!! merged-5876237249235911857-hrw8uc > MKULTRA1982(ConCrustyBrick)
09/18/2019 at 16:31

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No different than paying off a car that your upside down on that got totaled. Hence the availability of gap coverage.

Just another reason to not stretch on the payment terms.  Then you’re hopefully paid off sooner and less risk of either scenario happening.  This certainly sucks though.  So you fix it and keep paying.  Or you, push it to a parking lot and set it on fire.  


Kinja'd!!! MKULTRA1982(ConCrustyBrick) > merged-5876237249235911857-hrw8uc
09/18/2019 at 16:36

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Reason #900 I buy ‘beaters’ 


Kinja'd!!! merged-5876237249235911857-hrw8uc > MKULTRA1982(ConCrustyBrick)
09/18/2019 at 16:43

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Yeah, not saying I haven’t been there before, but buying something you need to pay on for many years just doesn’t make good sense.  It’s risky.  But to each their own.  I plan to buy my next car cash again.  I was fortunate enough to do that with the S8, but next time around my budget won’t be as big.  I hate having a car payment.  So many more fun things to do with that money....  like repair your 10 year old German sedan that still prices parts as if the car was new....  maybe I’m not one to give advice on this topic, I’m clearly not right in the head.  ;)


Kinja'd!!! MKULTRA1982(ConCrustyBrick) > merged-5876237249235911857-hrw8uc
09/18/2019 at 16:48

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Do the math and (probably, my wallet has not yet  experienced the thrashing of German car ownership yet, soon E30s, soon...) you’re likely still under what most people would pay monthly for a Dodge Journey for 69 months, and you get to drive something awesome to boot. I completely agree with you about it seemingly like a waste, but I understand part of what you’re paying for is the warranty with new cars. S8 sounds like a sweet ride, Audi does luxobarges right


Kinja'd!!! merged-5876237249235911857-hrw8uc > MKULTRA1982(ConCrustyBrick)
09/18/2019 at 16:56

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Yeah, I could justify it a bit more on a new car, but even then, it’s tough. We bought a new Pacifica when they first hit the lots because we liked them so much better than the other options.... but I imagine that will be the last car we ever purchase new.  Depreciation is such a wonderful thing, and cars are so well made nowadays, it’s really tough to justify not going older to get more for the money.  I do love my Audi’s.  They make a fine automobile.  I do really enjoy my S8, it’s a great jack of all trades car.  Great cruiser and kid hauler, but it also hauls ass when desired.  And I’d argue it’s safer than a lot of new cars out there as well.  Very much over engineered, but in a good way.  But my main reason to get one was the aluminum body.  Michigan winters and all.  I’m tired of fighting rust.  


Kinja'd!!! Monkey B > whatisthatsound
09/18/2019 at 17:26

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that may be something USAA does because of their customer base. I haven’t heard of the option before, but doesn’t mean it’s not available elsewhere. Only part I’m 100% on is that the lending institution will want it insured...and I’d venture a guess there are rules on how the car is stored etc . and tags surrendered.

I know here in Delaware you lose your registration when the insurance company reports to DMV when you cancel.


Kinja'd!!! Monkey B > MKULTRA1982(ConCrustyBrick)
09/18/2019 at 17:28

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it does doesn’t it...but trees fall, thieves thieve etc. etc. They have  an investment they want protected.


Kinja'd!!! MKULTRA1982(ConCrustyBrick) > merged-5876237249235911857-hrw8uc
09/18/2019 at 20:42

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How did I not know about the Aluminum thing? Is that for the whole Audi lineup after a certain point? I too HATE body rust. I don’t care about aesthetics but rusted out rear wheel arches is UNACCEPTABLE to me   


Kinja'd!!! gmporschenut also a fan of hondas > Rainbow
09/18/2019 at 21:48

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was it stock?

I would talk to hyundai. My bosses car a couple years ago, and a friend both had engines go outside of warrenty and the dealer did some deal of 50/50.


Kinja'd!!! merged-5876237249235911857-hrw8uc > MKULTRA1982(ConCrustyBrick)
09/18/2019 at 22:48

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It’s just the A8/S8 and I believe the R8 for now.  The A8/S8 has been all aluminum for over a couple generations.  Mine is a D3, and I’m pretty sure the D2 was aluminum too, but I haven’t confirmed that.  One of the main reasons I went to the Audi ubersedan vs an older S class.  I’ve seen way too many s classes with rust holes and rotted rockers.  No thank you.