LAS VEGAS – Class action lawsuits were filed in Nevada against 10 major auto insurance companies on Tuesday, contending that the companies charged excessive insurance premiums during the pandemic by failing to account for a drop in driving and crashes.
The lawsuits acknowledge that some insurers provided discounts over the emptier roads and drop in accidents and claims, but the discounts did not offer “any meaningful relief that actually reflects the reduction in cars on the road and reduced driving during the pandemic,” according to the court filings. The rates that were charged violate state law against excessive premiums, the lawsuits contend.
The lawsuits were filed on behalf of Nevada insurance customers against State Farm, USAA, Geico, Acuity, Liberty Mutual, Farmers, Progressive, Travelers, Nationwide and Allstate.
“The filing of a lawsuit does not substantiate the allegations within the complaint,” State Farm, the country’s largest auto insurer, said in a statement. "We’ve recently learned about the filing, and it is premature to comment at this time.”
USAA was reviewing the lawsuit, according to spokesman Matt Hartwig. “However, I do think it’s important to note that on three occasions in 2020, USAA returned dividends totaling $1.07 billion to all auto insurance policy holders due to fewer drivers on the road because of the ongoing pandemic,” he said.
Liberty Mutual declined to comment.
Phone and email messages seeking comment from the other insurers were not immediately returned Tuesday.
States across the country began reporting a decline in traffic and crashes when COVID-19-related closures and stay-at-home orders were imposed starting last spring. Companies that sell the majority of the policies across the U.S. announced refunds or credits to drivers.