Florida lawsuit alleges GEICO adds strangers to policies to increase premiums

A Florida policyholder has filed a class action lawsuit against GEICO, claiming strangers were added to her auto insurance policy, which increased her premium.

According to the complaint, GEICO uses a standard practice of obtaining information from third-party sources to find licensed or permitted drivers to add to insureds’ policies.

On Feb. 21, 2024, GEICO emailed Allison Kane and her late husband who was on the policy at the time, “speculating ‘Carter K Riddle may be a licensed or permitted driver with your address listed as their primary address.'”

“GEICO did no more work to vet Riddle,” the suit states. “Instead, it added Riddle — a stranger — to the policy because no one called GEICO within 15 days of Feb. 21, 2024.”

Another individual was then added in December.

“GEICO routinely refused to remove individuals based on the insured’s truthful statement that the person had no connection to the household or vehicles and/or was insured elsewhere,” the suit states. “GEICO instead required documentation or third-party verification —requirements not disclosed in the notice, not required by the policy, and often difficult or impossible for insureds to obtain — making
it difficult or impossible for insureds to disprove GEICO’s unverified assumptions.”

The suit accuses GEICO, on behalf of statewide and nationwide classes, of breach of contract, breach of the covenant of good faith and fair dealing, and unjust enrichment. It also alleges violation of Florida’s Deceptive and Unfair Trade Practices Act.

“General insurance law, including Florida’s, requires insurers to base premiums on accurate and verified information and prohibits charging for risks that do not actually exist,” the suit states. “By adding unrequested drivers as ‘rated drivers,’ GEICO charged plaintiff premiums for nonexistent risks and for people who posed no underwriting exposure under the policy.”

GEICO also faces a class action lawsuit in Ohio that claims it underpays actual cash values on total loss claims.

“Instead of paying ACV, as required by the insurance policies and Ohio law, GEICO, through its valuation vendor CCC Intelligent Solutions, Inc. (CCC), reduced the payment amount by deducting an arbitrary ‘condition adjustment’ from the actual cost of comparable vehicles used to determine the ACV, even though neither GEICO nor CCC ever inspected the comparable vehicles so had no factual basis for making that deduction,” the suit states.

Earlier this month, GEICO filed a motion to dismiss the suit for failure to state a claim.

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