Sorry for the long post but lots of details here. This is an issue that my girlfriend is facing, not me.
My girlfriend has been a Geico car insurance customer since July 2021. She got into an accident on June 2023. It wasn’t a major accident. The other car had a few scratches, nearly no damage to my girlfriend’s car. Geico paid the other driver. She wasn’t eligible for automatic accident forgiveness since she was a new customer, so she had been paying for upgraded accident forgiveness the entire time. She was eligible for accident forgiveness for three years (until July 2024).
Now getting to the issue at hand, her insurance premium went up significantly starting January 2024. The listed reason was “due to an accident”. Upon reaching out to the customer care, Geico admitted that she was covered by accident forgiveness at the time of her accident and they submitted a case to underwriting to be re-reviewed. They never responded, but when she reached out to her in May 2024, they said her case had been denied and the surcharge would be applied. The reason they mentioned for this was that “her accident forgiveness was revoked because she got into an accident”.
So according to their logic, her accident forgiveness was cancelled because she got into an accident, and now they are saying the higher premium would apply because she doesn’t have accident forgiveness anymore. She had them send over the contract but it very much states that she is covered by accident forgiveness and meets all eligibility.
I personally can’t comprehend Geico’s logic. Cancelling accident forgiveness after you get into an accident and then raising your premium for the same accident seems to defeat the whole purpose of this coverage. Is there any legal action we can take? The one person we reached out to said that this might not be taken up by a lawyer because the amount is too small, and the only option might be small claims court or class action lawsuit if we can find more people who encountered this. We have no legal background so any advice on how to counter this would be helpful. Thanks in advance for any advice!
Geico not honoring accident forgiveness
byu/Frosty-Can-8671 inInsurance
Posted by Frosty-Can-8671
8 Comments
That probably won’t hold water in a DOI complaint. But you would have to get the full policy jacket forms and carefully read the wording of the forgiveness in order to confirm the specifics.
Check your docs if there is arbitration language and use it
Definitely sounds like a false advertising case, it sucks that this happened to you and that a giant like Geico probably gets away with it more than they should.
It may not be worth it to go through the trouble of paying for a lawyer to sue Geico but at least file a complaint with the FTC and your state.
Did she happen to make any other claims during that timeframe?
What state?
I don’t work for/with Geico, but I’m an independent PL agent, so here’s my best guess:
If she was three years clean (no prior at-fault accident claims, with any carrier, for 36mo prior to date of 2023 loss) & paying for this upgrade to have “immediate accident forgiveness”, it is 100% true that her first accident SHOULD NOT add a surcharge to her policy (if a surcharge is added, this could very well be in error) – Unfortunately, that doesn’t mean her premium won’t be impacted from the accident…
Most carriers have an Accident-Free or Safe Driver type discount. I would assume she lost said discount, causing her “rate to increase as a result of the first accident”
[If she wasn’t paying for the Upgraded/Immediate Forgiveness, her increase would have been even worse due to an at-fault accident surcharge being l applied in conjunction with losing said discount.]
Side note – This also happens to be a very unique (horrible) time in the industry, where the majority of policies with ALL carriers, are seeing significant (20-25%) increases even without any claims occurring.
TO ME, it sounds like Geico could be grossly mis-communicating the cause of her rate increase… (which I’d assume is likely due to a mix of ‘statewide rate revision & loss of said discount’)
-However, if Geico is specifically saying or writing “there is an at-fault accident surcharge”…. from the info you’ve provided, that would be an error on Geico’s end and needs to be corrected! (After it’s corrected, she should also receive a return for the over-premium she paid from the start of the renewal term while it was rated incorrectly.) Carriers DO make mistakes like this, often they are found and corrected on their own, but sometimes they are missed. And you may have to speak with 1, 2, or 3 different underwriters until it is caught.
I hope this is helpful! Good luck~
File a complaint with your states department of Insurance to keep a paper trail. Keep all documentation and coverage purchased. I’d definitely fight this.
You may need to get lucky and get a somewhat experienced customer service rep or see if your Agent is available to test this:
Do a test endorsement to dispute the violation (without submitting the change). If that violation has an impact on your renewal premium, disputing it would lower it, otherwise the premium would stay the same, which would mean that the premium increased for other reasons.
It may be entirely posible that whoever told you that the premium increased significantly because of that violation may not have taken the time to fully review your policy. There could be a rate revision for the State of MD, change of discounts, endorsements/changes on either current and renewal term, etc. Someone could have seen that violation and without fully reviewing the entire policy just said “Yup, thats the reason. My job here is done”.