Insurer Faces Class Action Over Depreciation Of Labor

An insurance company is being sued by customers who claim they were unpaid on claims because the carrier deducted labor depreciation from their payouts.

Illinois residents Betty and Daniel Grawe filed a class action complaint against Trumbull Insurance Co. last month, claiming it shortchanged them on a property damage claim from May 2021. Details of the claim were not disclosed in the legal filing.

The allegations being made in the lawsuit are similar to complaints within the auto repair sector, where a number of lawsuits have claimed policyholders are being undercompensated.

The lawsuit represents ‘hundreds or thousands of victims geographically dispersed’ throughout 15 states who’ve been collectively underpaid more than $5 million by Trumbull, lawyers said.

‘The relatively small amounts of damage suffered by most members of the proposed class make filing separate lawsuits by individual members economically impractical,’ the lawsuit says. ‘[The] plaintiff’s claims are typical of the claims of the class members, as they are all similarly affected by the defendant’s customs and practices concerning the withholding of labor.’