California appeals court certifies class action against National General alleging bad faith practices

By Isha Marathe

July 17 - (The Insurer) - The California Court of Appeals has certified a class action lawsuit against Allstate subsidairy National General Insurance Company, in a case alleging that the insurer improperly denied plaintiffs’ car accident claims and rescinded their automobile insurance policies.

Based on pre-certification discovery into the number of putative class members, the class is currently at 1,032 policyholders, but may be higher if the class definition widens.

In the lawsuit filed in San Bernardino, plaintiffs argued that National General, along with other insurers, retroactively rescinded automobile insurance policies because plaintiffs did not disclose household members who were 14 years of age or older on the initial insurance application, according to the complaint.

In the complaint, plaintiffs said they were not asked about the information and were prevented from even making such disclosures on the digital application.

Defendants used insurance brokers who were tasked with completing the digital application on behalf of the insured and plaintiffs claimed the undisclosed household members were not driving at the time of the relevant accidents, the complaint said.

The class action, which was first initiated in 2019, asserted 79 causes of action, which included class action claims for insurance bad faith, unfair business practices and breach of contract.

“This is a huge win for consumers who were misled, mistreated and financially harmed by a billion-dollar insurance company that put profits ahead of policyholders,” said attorney Justin King, lead counsel for the plaintiffs, in a statement to The Insurer.

“We’re pleased that the court recognized the legitimacy of these claims and is allowing this case to proceed as a class action. National General’s conduct deserves to be exposed in court, and we fully intend to hold them accountable.”

National General did not immediately respond to a request for comment.