GEICO Likely to Pay More Than $19M to Policyholders Over Total Loss Claims

GEICO has agreed to pay over $19 million to nearly 227,000 policyholders to settle allegations that it did not pay them the full amount owed in total loss claims.

The federal class action lawsuit was filed in 2019 and combined last year with a second suit filed in 2020.

The combined complaint alleges that GEICO breached private auto insurance policies by improperly calculating or failing to include sales tax for the purpose of buying a replacement vehicle in total loss claims.

Some plaintiffs also allege GEICO didn’t pay local and state regulatory fees. At least one plaintiff claims his sales tax wasn’t paid because his vehicle was leased rather than owned, which the suit says goes against policy terms.

The settlement class is split into two types of plaintiffs -- those owed sales tax and those owed regulatory fees.