Progressive Allegedly Underpays Auto Insurance Total Loss Claims, Say Car Owners

A recent class action lawsuit claims that Progressive underpays their auto insurance total loss settlements.

Plaintiffs Rolando Hernandez and Victor Davalos Amaro claim that Progressive routinely fails to pay the full actual cash value of totaled vehicles, meaning that consumers do not get the settlement payment they deserve.

A car is considered “totaled” if the cost to repair the vehicle exceeds the value of the car. In these cases, or in cases where the damage is over a certain percentage of the car’s value, the car is declared a “total loss.”

Hernandez reportedly leased a 2016 Lexus NX 200t F Sport which was insured through Progressive. In October 2017, Hernandez was allegedly involved in an accident that resulted in his Lexus being deemed a total loss.

Progressive allegedly used the opinion of a third party to pinpoint the Lexus’ value at $40,960.08. This amount was reportedly increased by a “condition adjustment” of $40.65 and an “aftermarket parts adjustment” of $400.

After these adjustments, the vehicle’s value was estimated at $41,400.73. Hernandez allegedly had a $500 deductible which was applied to the car’s value, resulting in a final settlement value of $40,900.73.

Hernandez claims that this settlement amount was far too small because it did not consider title transfer fees or registration transfer fees. Additionally, Progressive allegedly only accounted for 0.003 percent sales tax at $142.56. Hernandez claims that he deserves significantly more in payment to compensate for the full value of his car.

Amaro makes similar claims regarding his own claim with Progressive. He allegedly owned a 2017 Toyota Camry SE that was insured under Progressive. In November 2018, his Camry was reportedly involved in a car accident that ended with the vehicle being declared a total loss.

Through their third party, Progressive reportedly determined that the Camry’s base value was $15,267.37. After a “condition adjustment” of $21.92 and a $1000 deductible were subtracted from the value’s total, the settlement amount was $14,245.45. Amaro claims that this settlement amount did not include any title transfer fees or registration fees.

“The promise to pay [actual cash value] is a promise to pay the adjusted vehicle value (or what Defendants call ‘Market Value’), plus state and local sales tax based on the adjusted vehicle value, plus title and registration transfer fees, less any deductible and salvage-retained value,” the plaintiffs argue.

“Instead of fulfilling their contractual obligation, Defendants, as a matter of uniform procedure, refuse to include title or registration transfer fees to any insured. If an insured leases the total-loss vehicle, like Mr. Hernandez, Defendants also refuse to the pay the amount in sales tax owed under the Policy.”

Progressive claims that they pay actual cash values equivalent to “the market value of your vehicle based on pre-loss condition, age, options, mileage, etc.—minus any applicable collision or comprehensive deductible.”

Hernandez seeks to represent a Class of consumers who had a Florida car insurance policy issued by Progressive American Insurance that involved a total loss settlement within the last five years. Amaro seeks to represent a similar Class of consumers who had a Florida car insurance policy issued by Progressive Express Insurance that resulted in a total loss within the past five years.

The Auto Insurance Total Loss Class Action Lawsuit is Hernandez, et al. v. Progressive American Insurance Company, et al., Case No. 1:19-cv-22300-FAM, in the U.S. District Court for the Southern District of Florida.

Join a Free Total Loss Car Accident Class Action Lawsuit Investigation

If you were insured under an auto insurance policy, experienced a total loss car accident, and were not reimbursed for sales tax and other fees by your insurance company in the last 5 years, you may qualify to join a total loss car accident class action lawsuit investigation.

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