State Farm Total Loss Claims Class Action Says Insurer Should Pay Fees

A State Farm insurance policy holder has filed a class action lawsuit against the insurer for allegedly failing to cover all of the expenses related to State Farm total loss claims. She says that this occurred not only in her case, but in the case of many other policy holders in California.

The State Farm total loss claims class action lawsuit was filed by Wendy Ann Sperling. Sperling says that she is from Southern California, and took out a policy with State Farm Automobile Insurance Co. Allegedly, she her vehicle was totaled in 2017.

Sperling explains that she was insured by State Farm for her 2014 Toyota Prius. Allegedly, on or around April 18, 2017, she was involved in an accident. She allegedly made a claim for property damage with State Farm after her accident. She goes on to say that Toyota had a third-party vendor, AudaExplore, determine that the vehicle was a total loss with an adjusted market value of $12,126.000. Sperling stresses that AudaExplore then added $939.77 for sales tax and subtracted $500.00, arriving at a net adjusted value of $12,565.77.

Allegedly, State Farm then followed the same formula to arrive at $12,565.77. She states that the insurer did not make a payment for state and regulatory fees owed under the policy. 

According to Sperling, she was financially injured when State Farm did not pay all of what was owed to her after her crash. Allegedly, the insurer only paid the value of the vehicle itself after her crash, as opposed to the regulatory fees, vehicle title, and vehicle registration fees. She argues that State Farm’s failure to pay this amount was a breach of contract, as well.

Have Other Policy Holders Experienced Additional Fees?

To make matters worse, Sperling says that she is not alone. She says that the company makes a policy of failing to pay these additional fees in the case of many total loss policy holders in California. She elaborates, saying that the insurer pays the fees after a total loss claim in some cases, but does not uniformly pay them.

Sperling goes on to say that State Farm’s insurance policy does not contain any provision informing customers that the insurer will only cover the partial costs of the vehicle. She says that State Farm’s contract states that the insurer will cover the costs to replace a vehicle.

The State Farm total loss claims class action lawsuit then goes on to say that the costs of the fees plus the cost of the vehicle itself together make the costs to replace a vehicle. 

In Sperling’s eyes, these additional fees beyond the market value of the vehicle are part of the costs of a total loss claim in California because the state requires those who purchase vehicles to pay mandatory, one-time fees when purchasing and registering a vehicle. This allegedly means that these costs are unavoidable when replacing a vehicle after a total loss. 

Insure.com states that California is one of 34 states in the country that require insurers to pay sales tax as part of a loss settlement. Reportedly, an insurer must either offer to provide a replacement vehicle with all applicable taxes, licenses, and fees paid, or make a cash payment that includes the cost of taxes, fees, and licenses.

The Balance notes that some insurers do try to get out of paying all applicable fees, so drivers should file a claim as quickly as possible so that they have time to take action if they find that they did not receive the full compensation that they believe that they were due.

The State Farm Total Loss Claims CA Fees Class Action Lawsuit is Wendy Ann Sperling et al. v. State Farm Mutual Automobile Insurance Co., Case No. 3:20-cv-01014, in the U.S. District Court for the Southern District of California. 

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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