Toyota Receives Record Penalty for Vehicle Recall

04/19/2010

Their vehicle's overall safety record is among the factors under consideration when auto insurers determine consumers' premiums.

Avoiding dangerous cars may reduce the number of claims an individual files and the burden to an insurer. Millions of vehicles produced by Toyota Motor Corporation may fit into this category, leading to the most expensive automobile recalls in history, according to a recent report by Reuters.

The company currently faces a record $16.4 million civil fine for allegedly delaying the recall of 2.3 million vehicles containing faulty accelerator pedals. Toyota waited four months to notify the National Highway Traffic Safety Administration of the defective part, according to a statement from the U.S. Department of Transportation.

"I am pleased that Toyota has accepted responsibility for violating its legal obligations to report any defects promptly," Transportation Secretary Ray Lahood said. "We are continuing to investigate whether the company has lived up to all its disclosure obligations."

The company has submitted some 120,000 pages in documents to U.S. regulators to help determine its legal liability and whether additional fines will be necessary.

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