Accident forgiveness in auto insurance is a pretty simple concept: while plans that have the feature cost more, your insurance company can’t hike your premiums after you get in a crash and actually need the insurance. It also happens to be illegal in California, which is why the district attorneys in San Diego, Riverside, and Los Angeles counties filed a consumer protection lawsuit against Liberty Mutual over ads touting the feature, which it settled for $925,000.
The commercials were meant for a nationwide audience, but reached the majority of television viewers in California. They contained a small, fast-moving disclaimer in fine print at the bottom of the screen that was easy to miss.
The insurance company didn’t admit fault, but will pay each of the counties $308,322 in civil penalties for the ads and investigative costs. The insurer also must follow California laws in its future ads, and worked with the counties to change its advertising.
Liberty Mutual to pay $925K in accident forgiveness ad lawsuit [San Diego Union-Tribune]
by Laura Northrup via Consumerist
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