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United Services Automobile Association (USAA) charges enlisted service members at higher rates for vehicle coverage than their higher ranking officers, two California veterans claim.
The lead plaintiffs, Eileen-Gayle Coleman and Robert Castro, are taking legal action against USAA in a new class action lawsuit over unfairly priced auto policies.
These differences in rates are being charged by USAA despite the plaintiffs holding a “good driver” status.
Coleman and Castro say USAA is offering non-ranking service members the 20 percent discount for having a good driving history, as required by California law, but are funneling non-officers to a “substandard” insurance product, according to the complaint.
USAA offers two insurance products, according to the complaint: USAA General Indemnity Company (USAA-GIC) and United Services. Castro and Coleman allege USAA-GIC is priced at higher rates and a United Services plan is only available to officers.
“As shown by its pricing of automobile insurance policies and its deceptive business practices, USAA respects and honors current and former military officers more than it does current and former enlisted personnel,” the complaint stated.
USAA doesn’t mention this to service members signing up for coverage, according to the complaint. Policyholders are never told enlisted status is a factor taken into consideration when quoting rates on policies.
Coleman and Castro argue these differences are significant. Policyholders in California who weren’t officers paid nearly 75 percent more than officers with similar driving records last year on their premiums, according to the complaint.
The premium difference between officers and enlisted policyholders in 2017 was 57 percent.
By not being open about these rate differences, USAA is breaking California laws regulating insurers and business practices, the complaint claims.
Formally the class action lawsuit alleges violations of California’s Insurance Code and Unfair Practices Act, in addition to the federal Military and Veterans Code.
Castro and Coleman are seeking to represent thousands of potential class members who serve or served in the military who hold the policies they’re suing over.
“No legitimate business interest justifies USAA’s discrimination against enlisted men and women,” the lawsuit states.
Are you a member of the armed services with a USAA car insurance policy? What do you think of the claims officers are getting better rates? Let us know in the comments below.
Counsel representing the plaintiffs in this class action lawsuit are Harvey Rosenfield, Benjamin Powell of Consumer Watchdog; Jay Angoff, Cyrus Mehri, Desiree Langley of Mehri & Skalet PLLC; Gary Mason and Danielle Perry of Mason Lietz & Klinger LLP.
The Military Car Insurance Class Action Lawsuit is Coleman et al. v. USAA et al., Case No. 3:21-cv-00217, in the U.S. District Court for the Southern District of California.
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36 thoughts onUSAA Auto Insurance Charges Non-Officers More, Veterans Say
Please add us we have been with them for a long time over 7 years
Please add me
Add me
I’m looking to see what might happen, have been with USAA for years.
Add me
We’ve been with them for over 10 years. Please add us to this class action, too
I had my first car accident a few years ago with them. They claimed my insurance wouldn’t go up bc of my first accident. However it did go up a few dollars.same happened to my husband.
Please add me to this class action. Charged higher rates even though I have no accidents
We live in PA. Our auto went up about 600 + every six months. Last accident was 5 and 1/2 yrs ago. We had a few minor things like a few deer, bob cat, turkey, etc. Within a three yr. period, our homeowners, went from around $1, 300 to about $2, 300. Only had one claim in 10 yrs, that was 5 & 1/2 yrs ago. We had the car accident, usaa told us the only way to get coverage for the lost of the personal items that was damaged was to file a homeowners claim.
When I called to ask about the increase, I was told it costs more for them to do business in PA and to recoup their losses, they charge more for PA residents.
I have been an enlisted USAA member for over 20 years, please add me to your class action.
I’m a long standing member of USAA please add me John Cruz