Lawsuit: Geico Miscalculates Values of Totaled Vehicles [UPDATE]
by Erin Shaak
Last Updated on February 28, 2020
Sullivan et. al v. Government Employees Insurance Company
Filed: May 17, 2017 ◆§ 6:17-cv-00891-PGB-KRS
A proposed class action lawsuit has been filed against Government Employees Insurance Company ('GEICO') for allegedly failing to pay the 'actual cash value' of vehicles.
Case Updates
Update – January 6, 2020 – Geico Reaches $27M Settlement with Total Loss Claimants
A federal judge has preliminarily approved a proposed settlement in a case filed over allegations that Geico wrongly excluded title and tag transfer fees from payments made to policyholders in connection with total-loss claims. The plaintiffs argued that such fees are “necessary costs” to replace a vehicle and should therefore be included as part of the car’s “actual cash value” that Geico agreed to pay in the event a covered vehicle was declared a total loss.
The settlement, which the parties praised as an “extraordinary” result that provides “near-complete relief” to class members, aims to pay each affected policyholder a total of $79.85 (consisting of $75.25 in title transfer fees, $4.10 in tag transfer fees, and $0.50 in branch fees), plus prejudgment interest. According to court documents, Geico also agreed to change its practices in Florida as part of the deal and will include transfer fees on all first-party total loss claims for five years after the settlement receives final approval.
The deal covers all Florida policyholders who:
- were insured for private-passenger auto physical damage coverage by Government Employees Insurance Company or GEICO General Insurance Company;
- suffered a first-party loss of a covered owned vehicle any time between May 17, 2012 and January 6, 2020; and
- were not paid by a defendant the full title, tag and branch transfer fees as part of their total loss payment.
The settlement will also cover those who meet the above requirements but were instead insured by GEICO Indemnity Company and suffered a total loss of their vehicle between October 12, 2012 and January 6, 2020.
A final approval hearing has been set for June 17, 2020. In the meantime, keep an eye out for class notices and a settlement website that should be going up soon.
A proposed class action lawsuit has been filed against Government Employees Insurance Company (“GEICO”) for allegedly failing to pay the true “actual cash value” (ACV) of insured vehicles in cases of total loss. The complaint claims Geico does not account for state and local regulatory fees when calculating a totaled vehicle’s ACV value. Geico allegedly found the plaintiff’s vehicle to be worth $6,588.84, but noted that “other factors (e.g. license and fees) may need to be taken into account” before the final amount was paid. The suit argues, however, that the defendant failed to account for these extra fees and therefore did not provide the total cost of replacing the vehicle, as promised in the plaintiff’s insurance policy. The suit seeks to cover the following class:
“All insureds, under a policy issued by Government Employee Insurance Company covering a vehicle in the State of Florida, who sustained a total loss to said vehicle and who, within the five year time period prior to the date on which this lawsuit was filed till the date of any certification order, received payment from Government Employee Insurance Company for said loss, which payment did not include state and local regulatory fees for the loss of said vehicle.”
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