Geico must pay $1.9 million to settle class action lawsuit

Overview of the Geico class action lawsuit settlement:

• WHO: Geico has agreed to pay nearly $2 million to settle a class action lawsuit.
• Why: The Geico class action lawsuit alleges that the insurer failed to pay title transfer or registration fees for totaled insured vehicles.
• Where: The class action lawsuit against Geico was filed in federal court in New Jersey.

A plaintiff on July 1 asked a federal judge in New Jersey to approve a nearly $2 million settlement with Geico.

Plaintiff Diane McCoy filed the motion for preliminary approval of the settlement in the Geico class action lawsuit. The settlement would resolve allegations that the insurance company failed to pay title or registration transfer fees for the total loss of the insured vehicles.

Approximately 33,000 Geico policyholders are eligible as class members. If the Geico settlement is approved, class members may be entitled to compensation equal to approximately 90% of the title and registration transfer fees.

Class action lawsuit against Geico: Insurer failed to pay mandatory replacement fees

McCoy filed the class action lawsuit against Geico after her car was totaled in a car accident in 2018. 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 losses 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 of title or registration transfer fees. Those fees are mandatory vehicle replacement costs in New Jersey, Geico’s class action lawsuit states.

McCoy argues that the “replacement cost” for a total loss vehicle includes mandatory replacement fees, and claims that Geico’s failure to pay those costs amounts to a breach of contract.

She filed the class action lawsuit against Geico on behalf of herself and other Geico policyholders who allegedly received underpayment of replacement fees for their total loss claims.

Geico has also agreed to pay replacement fees for total loss vehicles in New Jersey in the future.

McCoy told the court that Geico’s proposed settlement terms were “fair, reasonable and appropriate” and asked the judge to tentatively approve the deal.

A similar Settlement in Geico class action lawsuit was recently achieved in Louisiana.

What do you think about this settlement with Geico? Let us know 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 Class action lawsuit against Geico Is Diane McCoy v. Geico Indemnity Co.Case No. 3:20-cv-05597, in the United States District Court for the District of New Jersey.

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