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Geico Sued for Underpaying Windshield Repair Costs

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June 14, 2017—A Florida automotive glass company has leveled a class action lawsuit at Geico, claiming the insurance company short-changed the repair shop, according to glassBYTES.

The lawsuit, originally filed in 13th Judicial Circuit Court in Florida by plaintiff VIP Auto Glass Inc., accuses Geico of using arbitrary price comparisons to determine a “prevailing competitive price” for its reimbursements to automotive glass companies, in order to pay as a little as possible.

The prices Geico sets are significantly lower than the NAGS benchmark list price, according to the complaint.

The case arose after a February incident in which Deryl Jones—listed in the court records as the “insured customer”—had his windshield repaired and replaced by VIP Auto Glass, in accordance with Jones’ insurance policy.

Once the repair was complete, Geico allegedly underpaid VIP Auto Glass for its work, according to the court records. The reason for not repaying the company in full was that Geico paid what it determined to be the “prevailing competitive price” for the repairs.

The plaintiffs further allege that Geico:

  • Routinely rejects and refused to pay windshield repair and/or replacement prices incurred by its insureds and charged by said repair facilities;
  • Takes the position that other windshield repair facilities would have performed the repair and/or replacement at the so-called “prevailing competitive price;”
  • Underpays the windshield repair facility based on the so-called “prevailing competitive price” that Defendant contends it “can secure” from a “competent and conveniently located repair facility;
  • Leaves an unpaid balance due and owing.

VIP Auto Glass is seeking declaratory and injunctive relief. Both sides have until January to present evidence for a judge to determine if the case should be certified as a class action suit. That certification is expected in February 2017.

 

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