Judge dismisses Texas false advertisement lawsuit against GEICO
A Texas false advertisement class action lawsuit against GEICO has been dismissed with prejudice as agreed upon by the parties.
The suit alleges the insurance company has falsely advertised its “Accident Forgiveness” benefit.
Plaintiff Christopher Cude’s complaint states that his premium increased by 2.5% upon renewal in May 2024 and included the Accident Forgiveness (AF) benefit for free, which would waive a surcharge associated with the first at-fault accident caused by an eligible driver on his policy.
However, in November 2024, following an at-fault accident the month before, GEICO increased Cude’s premium by 91.3%, according to the complaint.
A judge ruled in March that the plaintiff representative in the case failed to allege fraud with particularity.
Cude alleged violations of the Texas Deceptive Trade Practices Act (DTPA), Texas Insurance Code Chapter 541, breach of the implied covenant of good faith and fair dealing, and unjust enrichment.
GEICO sought to dismiss all the claims under Federal Rule of Civil Procedure 12(b)(6), or for abatement pursuant to the DTPA.
According to court documents, when Cude asked GEICO to explain the increase and reminded them of the Accident Forgiveness policy, a GEICO representative said it wasn’t a premium increase, but rather a “surcharge.”
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