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Consumers say ten major auto insurers failed to properly adjust their rates to account for less driving and fewer wrecks during pandemic lockdowns in multiple class action lawsuits filed earlier this week in Nevada.
The lead plaintiffs allege that, though some companies offered discounts during COVID-19 restrictions that kept many workers home and off the road, the move failed to account for the drastic lack of driving during these times. One of the lawsuits state that insurers failed to provide “any meaningful relief that actually reflects the reduction in cars on the road and reduced driving during the pandemic.”
“I believe that the rates should have been cut something in the order of 50-60%,” a lawyer representing plaintiffs in all the lawsuits said in a statement to The Associated Press. “These discounts that were given, were just totally woefully inadequate.”
The class action lawsuits were filed against State Farm, USAA, Geico, Acuity, Liberty Mutual, Farmers, Progressive, Travelers, Nationwide and Allstate.
The lawsuits point out that pandemic lockdowns led to a decline in traffic and auto accidents starting in the spring of 2020. Some auto insurers offered a variety of discounts to reflect the changed conditions, from a one-time refund of $50 to $100 or temporary bill reductions. However, the plaintiffs argue that insurance companies’ discounts did not accurately account for the dramatic reduction in car accidents and as a result the companies experienced windfall profits.
The class action lawsuits say these savings auto insurers experienced during pandemic lockdowns should be passed on as lower rates to policyholders, along with damages.
Auto Insurers Respond to Class Action Lawsuits
A spokesperson for USAA told the Associated Press that the company was reviewing the lawsuit.
“I do think it’s important to note that on three occasions in 2020, USAA returned dividends totaling $1.07 billion to all auto insurance policy holders due to fewer drivers on the road because of the ongoing pandemic,” he told reporters.
“The filing of a lawsuit does not substantiate the allegations within the complaint,” State Farm reportedly said in a statement issued after the allegations were lodged. “We’ve recently learned about the filing, and it is premature to comment at this time.”
“Nationwide is taking the longer view while continuing to monitor consumer driving behaviors and how they impact future miles driven and accident frequencies,” the insurance company said in a statement issued Wednesday. “We know customers want fair rates and agents are seeking stability.”
Liberty Mutual declined to comment and other companies had not returned requests for comments, reports AP News.
Do you think you paid excessive rates to your auto insurance company during pandemic lockdowns? Tell us about it in the comment section below!
The lead plaintiffs in all the class action lawsuits are represented by Robert Eglet of Eglet Adams.
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446 thoughts onTen Auto Insurers Hit With Class Action Lawsuits Over Excessive Rates Amid Pandemic
Please add me. Tes I got a very small monthly discount for a few months and now with my renewal my insurance went way up this is ridiculous. I have 2 cars and my motorhome with them along with my renters insurance which also went up.
Farmers gave a piddly little refund Covid check..about $8 or less per vehicle! Then…SLAMMED US By raising all of our vehicles and BUNDLED ALL (4) of our vehicle payments into One Payment which are due every 6 months June & December! Same time as other payments such as Property taxes, Christmas, license plate tabs, etc.!!! I originally had insurance payments spread out seperately!
It’s like Hey! Look great…give a small refund check…then Slam them with Higher Rates!!! I accused them of that at the time! Of course it was denied! I drive less than 5 miles per day and at 65 NEVER an Accident or ticket! Hubby drives 20 miles per day.
No one can add you. You have to wait for the actual class action suit info.
Geico had ads on tv for savings, and when I called to basically how to be part of it, I was told that it only applied to motorcycle but the commercial was for auto. There was no change in my bill through the shut down…. No accidents or anything on my record but a seat belt ticket 9 years ago.
I received 3 different price changes over about 3 months from State Farm, all with higher rates. Very confused, I tried to make sense of this all but it seemed it was on purpose. Please include me as I want to know what’s going on.
Add me … I have Geico with 4 drivers on my account and Not one of us left the house during the pandemic.
Add me I have geico perfect driving record no points accidents etc barely go anywhere because I have cancer and I pay almost 200 a month
Yes, definitely Mercury Insurance bumped up my insurance by $100. So add me
Yes add me to Start Farm I believe my insurance was increased
Add me State Farm