Handling of total loss vehicle claims continues to spawn class actions.
In Florida, seven alleged class actions have been filed since June against insurers that use CCC or Mitchell software and databases to assist in valuing total loss vehicles. In suits against Allstate, GEICO, Esurance, USAA and Progressive American, and two suits against Progressive Select, insureds claim that Florida law allows the use of a "recognized used motor vehicle industry source" database to determine the value of a total loss vehicle, but claim CCC and Mitchell are used only by the insurance industry, not the used motor vehicle industry, so use of their databases violates the statute. None of the complaints address the provision of the same statute that allows insurers to use any other method to determine value so long as it is disclosed to the insured. Though several carriers have moved to compel appraisal, there have been no rulings on the merits in any of the cases to date.
In another total loss vehicle class action, a California district court refused to dismiss claims that an insurer improperly used salvage titled vehicles as comparables to determine the value of an insured's total loss vehicle. The insured had purchased a 16-year-old car for $3,250, and was paid $2,800 by his insurer when he totaled it less than a month later. Not answered in the decision, which was limited on a motion to dismiss to only the allegations of the complaint, is whether comparable values that were not salvaged vehicles even existed for a 16-year-old car. The court dismissed claims against the vendor that provided the vehicle value reports. Jones v. Progressive Cas. Ins. Co., Case no. 2018 WL 4521919 (N.D. Calif. Sept. 19, 2018).
Also, an insured filed class claims in a Pennsylvania state court a month ago, alleging that his insurer did not include sales tax in determining the replacement value of his total loss vehicle. That case was removed to federal court. Erby v. The Allstate Corp., Case no. 2:18-cv-04944-PBT (E.D. Pa.).
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.