Progressive Universal ACVs Reduced by Projected Sold Adjustment Iowa Class Action

What is a Projected Sold Adjustment? Is it a legitimate reduction in the actual cash value (ACV) of a totaled vehicle, to help determine the insurance payout? The complaint for this class action alleges that it is not. According to the complaint, Progressive Universal Insurance Company “systematically thumbs the scale” when it asks its vehicle valuation vendor, Mitchell International, Inc., to deduct a Project Sold Adjustment from the prices of comparable vehicles.

The class for this action is all Iowa citizens insured by Progressive Universal who, between the earliest allowable time and the date the class is certified in this case, received compensation for the total loss of a covered vehicle based on a valuation report prepared by Mitchell where the ACV was decreased by Projected Sold Adjustments to the comparable vehicles used to determine ACV.

When Progressive Universal declares a vehicle a total loss, it asks Mitchell to provide a valuation report to determine the vehicle’s ACV. Mitchell finds comparable vehicles in the relevant geographic area and adjusts their prices based on differences such as mileage, options, and equipment. After that, the complaint alleges, Progressive Universal requires that it apply a Projected Sold Adjustment.

The complaint alleges that this Projected Sold Adjustment is deceptive, unexplained, contrary to appraisal standards, and not based in fact. The only explanation of this adjustment, the complaint claims, is a statement on the last page of the valuation report that says that it is subtracted to “reflect consumer purchasing behavior (negotiating a different price than the listed price).”

According to the complaint, Progressive Universal does not provide any data to support the amounts that are deemed to be Projected Sold Adjustments. But the complaint alleges that the Adjustments “do not reflect market realities … and run contrary to customary automobile dealer practices and inventory management, where list prices are pried to reflect the intense competition in the context of internet pricing and comparison shopping.”

In fact, the complaint claims, a “negotiated price discount would be highly atypical” in the current market, and the Projected Sold Adjustment is therefore “not proper to include in determining actual cash value.” The complaint also points out that those who have lost their vehicles generally need to find new transportation immediately and do not have time to seek out “the illusory opportunity to obtain the below-market deal [Progressive Universal] assumes always exists…”

The complaint also claims that the projected sold adjustments are “contrary to appraisal standards.” It says that Mitchell’s main competitor for valuation reports, CCC Intelligent Solutions, does not apply projected sold adjustments but uses list prices., and that Progressive Group companies do not apply Projected Sold Adjustments in California.

The complaint thus alleges that the Projected Sold Adjustment is “deceptive and improper” and results in insured receiving a smaller payout for their totaled vehicle than they would have otherwise.

Article Type: Lawsuit
Topic: Insurance
Tags: Actual Cash Value, Auto Insurance, Incomplete payment of benefits due, Insurance