GEICO Class Action Says Windshield Repair Claims are Underpaid

GEICO routinely underpays windshield repair companies for claims, according to the plaintiff in an insurance class action lawsuit.

Plaintiff VIP Auto Glass Inc., a Florida-based automotive glass repair service, says that GEICO General Insurance Company has been systematically underpaying the plaintiff and other windshield repair businesses, based on an allegedly skewed reading of its own car insurance policy terms.

According to this GEICO class action lawsuit, a GEICO-insured customer brought his car to VIP in February 2016 for windshield repair and assigned his insurance benefits to VIP to cover the cost of repair.

VIP says it did the repair and submitted an invoice to GEICO for reimbursement. GEICO then allegedly underpaid VIP and has refused to pay the full amount billed, the plaintiff claims.

VIP argues that by shorting claimants this way, GEICO is running afoul of a Florida statutory ban on the application of a deductible to windshield repair costs. The GEICO class action lawsuit quotes that law as well as a section of GEICO’s standard Florida car insurance policy that says, “No deductible will apply to loss to windshield glass.”

“By refusing to fully pay the windshield repair and/or replacement charges incurred by its insureds and thereby leaving its insured exposed to liability for the unpaid balance of the charge, Defendant is imposing a ‘de facto’ unlawful deductible upon its insureds,” VIP argues.

VIP states that under GEICO’s standard Florida auto insurance policy, coverage for windshield repair costs is defined by “the prevailing competitive price which is the price we can secure from a competent and conveniently located repair facility.”

VIP says the policy offers no other guidance as to what constitutes a “prevailing competitive price.”

But the plaintiff claims that instead of determining what would be the “prevailing competitive price,” GEICO refers to prices set in an internal document from 2008 entitled “GEICO Glass Pricing Agreement.” VIP alleges the price determinations in this document have nothing to do with actual prices GEICO could secure from other competent and conveniently located repair facilities.

VIP also claims GEICO is unlawfully reducing the amount of coverage its insureds are entitled to receive and that the “prevailing competitive price” language in the GEICO policy is vague or ambiguous in a way that requires the court to interpret it in favor of providing the highest level of benefits to the insured.

VIP seeks to represent a plaintiff Class consisting of all entities who within five years before the filing of this GEICO lawsuit owned a windshield repair facility in Florida, made windshield repairs that should have been covered by GEICO, and billed GEICO for those repairs under an assignment of benefits, but did not receive full payment from GEICO.

The GEICO class action lawsuit seeks an order forbidding GEICO from continuing the practices complained of. It also seeks a damage award to cover policy benefits allegedly unpaid, plus reimbursement of the plaintiff’s court costs and attorneys’ fees.

VIP is represented by attorneys J. Daniel Clark and Matthew A. Crist of Clark Martino PA and by David M. Caldevilla of de la Parte & Gilbert PA.

The GEICO Windshield Repair Underpayment Class Action Lawsuit is VIP Auto Glass Inc. v. GEICO General Insurance Co., Case No. 8:16-cv-02012, in the U.S. District Court for the Middle District of Florida.