Geico class action settlement overview:
- Who: Geico has agreed to pay nearly $2 million to settle a class action lawsuit.
- Why: The Geico class action alleged the insurer failed to pay title or registration transfer fees for the total loss of insured vehicles.
- Where: The Geico class action lawsuit was filed in New Jersey federal court.
A nearly $2 million Geico settlement should be approved, a plaintiff urged a New Jersey federal judge on July 1.
Plaintiff Diane McCoy filed the motion for preliminary approval of the Geico class action settlement, which would resolve allegations the insurance company failed to pay title or registration transfer fees for the total loss of insured vehicles.
About 33,000 Geico policyholders may qualify as class members. If the Geico settlement is approved, class members may be entitled to compensation valued at about 90% of the title and registration transfer fees.
Geico class action says insurer failed to pay mandatory replacement fees
McCoy filed the Geico class action lawsuit after her car was totaled in a 2018 auto accident. She filed a claim with Geico, and the insurance company determined the vehicle was a total loss.
According to her Geico policy, Geico’s liability for loss is limited to the actual cash value of the property at the time of the loss. Geico paid McCoy approximately $3,500 for the loss, which did not include payment for title or registration transfer fees. These fees are mandatory vehicle replacement costs in New Jersey, the Geico class action explains.
McCoy argues the “replacement cost” on a total loss vehicle includes the mandatory replacement fees, and claims Geico’s failure to pay these costs amounts to a breach of contract.
She filed the Geico class action lawsuit on behalf of herself and other Geico policyholders who were allegedly underpaid on the replacement fees due to their total loss claims.
Geico has also agreed to pay replacement fees in New Jersey on total loss vehicles moving forward.
McCoy told the court the proposed Geico settlement terms are “fair, reasonable and adequate” and urged the judge to preliminarily approve the deal.
A similar Geico class action settlement was recently reached in Louisiana.
What do you think about this Geico settlement? Tell us your thoughts in the comments.
McCoy is represented by Mark A. DiCello and Daniel R. Ferri of DiCello Levitt LLP, Rachel Dapeer of Dapeer Law PA, Edmund A. Normand of Normand PLLC, Scott Edelsberg and Adam Schwartzbaum of Edelsberg Law PA and Andrew J. Shamis of Shamis & Gentile PA.
The Geico class action lawsuit is Diane McCoy v. Geico Indemnity Co., Case No. 3:20-cv-05597, in the U.S. District Court for the District of New Jersey.
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