Are You Owed More? Progressive Faces Lawsuits Over Undervaluing Totaled Cars

If your car has been totaled, you expect fair compensation from your insurance company. But what happens when the offer seems too low? Across the nation, Progressive is facing lawsuits alleging systematic undervaluation of totaled vehicles, leaving policyholders shortchanged. If you suspect you’ve been a victim, you might be owed more than you think.

The Core of the Issue: Undervaluation

When an insurance company declares a vehicle a total loss, they are obligated to pay the vehicle’s actual cash value (ACV) immediately before the accident. This ACV should account for factors like the car’s make, model, year, mileage, condition, and local market conditions. However, lawsuits against Progressive claim the insurer uses tactics that artificially lower ACV, such as:

Using Inaccurate Data: Relying on data from sources that don’t accurately reflect local market values or vehicle condition.
Ignoring Vehicle Options and Upgrades: Failing to account for optional features, aftermarket upgrades, or recent repairs that increase a vehicle’s worth.
Improperly Assessing Condition: Downplaying the vehicle’s condition before the accident, leading to a lower valuation.
Comparable Vehicle Selection: Choosing comparable vehicles that are not truly comparable, such as those with higher mileage or in poorer condition.

Legal Actions Against Progressive

Several class-action lawsuits have been filed against Progressive, alleging breach of contract, bad faith, and unjust enrichment. These lawsuits generally claim that Progressive’s practices violate their contractual obligations to policyholders and state laws governing insurance claims.

What does “bad faith” mean in this context?

In insurance law, “bad faith” refers to an insurer’s intentional or reckless failure to fulfill its obligations to its policyholders. This can include unreasonably denying a claim, delaying payment, or, as alleged in these lawsuits, undervaluing a totaled vehicle.

How to Determine if You’re Affected

If Progressive has totaled your vehicle, consider these steps to determine if you might be owed more:

Request the Valuation Report: Ask Progressive for a detailed report explaining how they determined your vehicle’s ACV.
Review the Report Carefully: Scrutinize the data used, comparable vehicles cited, and any adjustments made for your vehicle’s condition or features.
Gather Your Own Evidence: Research the value of similar vehicles in your area using resources like Kelley Blue Book, Edmunds, and local car listings. Document any options, upgrades, or recent repairs that increase your vehicle’s value.
Consider a Professional Appraisal: A qualified appraiser can assess your vehicle’s value and provide an independent opinion.

State Laws and Regulations

Insurance regulations vary by state, and many states have specific laws governing how insurers must handle total loss claims. These laws often outline the factors that must be considered when determining ACV and the procedures insurers must follow. Progressive operates nationwide, so it must adhere to different regulations based on where the policy was issued.

What to Do If You Suspect Undervaluation

If you believe Progressive has undervalued your totaled vehicle, you have several options:

Negotiate with Progressive: Present your evidence and attempt to negotiate a higher settlement.
File a Complaint with Your State’s Insurance Department: Your state’s insurance department can investigate your complaint and potentially mediate a resolution.
Pursue Legal Action: Consult with an attorney to discuss your legal options, including filing a lawsuit against Progressive.

The Role of Legal Representation

Navigating insurance claims and legal actions can be complex. An experienced attorney can:

Evaluate Your Claim: Assess the fairness of Progressive’s offer and advise you on your legal options.
Negotiate with Progressive: Advocate on your behalf to negotiate a fair settlement.
File a Lawsuit: Represent you in court if necessary to pursue your claim.
Understand State Laws: Help you navigate the specific insurance laws and regulations in your state.

The Importance of Documentation

Throughout the claims process, meticulous documentation is crucial. Keep records of all communication with Progressive, including dates, times, and the names of representatives you spoke with. Save all documents related to your vehicle, such as purchase agreements, repair bills, and photos of its condition before the accident.

Beyond the Lawsuits: A Systemic Problem?

The lawsuits against Progressive raise questions about whether the alleged undervaluation is an isolated issue or a systemic practice within the company. If Progressive is indeed undervaluing totaled vehicles on a widespread basis, it could affect thousands of policyholders across the country.

Protecting Yourself in the Future

While you can’t predict an accident, you can take steps to protect yourself from potential undervaluation:

Maintain Accurate Records: Keep detailed records of your vehicle’s condition, options, upgrades, and any repairs.
Review Your Insurance Policy: Understand your policy’s terms and conditions regarding total loss claims.
Consider Gap Insurance: If you have a loan or lease on your vehicle, gap insurance can cover the difference between the ACV and the amount you owe.

Are You Owed More? Take Action Now

If you believe Progressive has undervalued your totaled vehicle, don’t accept the offer without a fight. By understanding your rights, gathering evidence, and seeking legal assistance if necessary, you can pursue the fair compensation you deserve. Contact us today for a free consultation to discuss your case and explore your options.