Auto Insurance Group Good Driver Discounts California Class Action

In California, drivers may qualify for a Good Driver Discount (GDD) policy with lower rates. This class action brings suit against eight insurance companies of Nationwide Corp. Group for their GDD policy prices. The complaint alleges they offered GDD policies at higher rates than the lowest rate of any company within its common-ownership group, in violation of California laws.

The class for this action is all of the eight defendants’ current and former policyholders who qualified under California law to buy a GDD policy who, between January 1, 2009 and the last date Victoria and Titan sold personal auto policies in California, paid premiums for the policies in excess of the lowest rate available for that coverage from any other insurance company within the companies’ California-licensed common ownership, management, or control group.

The eight defendant companies are Amco Insurance Company, Nationwide Insurance Company of America, Allied Property and Casualty Insurance Company, Victoria Fire and Casualty Company, Crestbrook Insurance Company, Depositors Insurance Company, Nationwide Mutual Insurance Company, and Titan Indemnity Company.

According to the complaint, “The statutorily[-]qualified Good Drivers are entitled to be offered by insurance company agents or representatives and are entitled to purchase the policy with the lowest Good Driver rate for that coverage from any company within the group of insurers…”

In this case, the complaint says, the group is Nationwide Corp. Group, which the complaint alleges is owned by Nationwide Mutual Insurance Company (NMIC).

The California Insurance Code specifies that “the rate charged for a Good Driver Discount policy … shall be at least 20% below the rate the insured would otherwise have been charged for the same coverage.”

The law does contain a Super Group Exemption, but the complaint alleges that the companies in the Nationwide group did not meet all eight criteria for the exemption during the class period for this case.

For example, the complaint alleges, “Defendants conducted joint marketing meetings and assisted each other in developing marketing and sales channels including the sharing of agent lists and set-up of agent introduction for the benefit of NMIC as a whole rather than the benefit of the individual company providing assistance to its affiliate company.”

The complaint alleges that the subject of this class action “is the unlawful, unfair, and fraudulent business operations, marketing, management and sales practices of the Defendants as members of the same Control Group.” The complaint claims that the companies did not offer the lowest-priced policy available from the various members of the group to all those who qualified for GDD policies.

The counts include breach of contract and breach of the covenant of good faith and fair dealing, among other things.

Article Type: Lawsuit
Topic: Insurance
Tags: Auto Insurance, Insurance, Insurance Rates