Allstate to refund $680K to auto customers

Posted September 15, 2010

— More than 1,800 Allstate Insurance Co. policy holders in North Carolina will receive refunds totaling $680,718 after a state Department of Insurance investigation revealed the company was overcharging some auto insurance premiums, officials said Wednesday.

The investigation revealed that Allstate was wrongly including rental car costs when calculating property damage claim totals. Allstate’s miscalculations occurred in 1,803 policies from July 2005 to July 2008.

Vehicle crashes that produce property damage costs in excess of $1,800 automatically apply two safe-driver incentive points to the insurance policy, which can lead to higher premiums, while damages resulting in less than $1,800 of damage may be eligible for a waiver on points.

The DOI became aware of the overcharges when researching a consumer complaint. As soon as Allstate became aware of the rating error, the company amended the situation and began processing premium credits and refunds, officials said.

“Everyone makes mistakes, even insurance companies. That’s why the Department of Insurance is here," Insurance Commissioner Wayne Goodwin said in a statement. "We work every day to find these kinds of mistakes, make sure companies fix them and protect consumers across North Carolina from future errors.”


This story is closed for comments.

Oldest First
View all
  • hallmark Sep 15, 2010

    share your comments GregBrady - what should we be looking out for?

  • GregBrady Sep 15, 2010

    The Insurance Commissioner needs to look at certain parts of his own house. Some of the practices of the Dept of Insurance are shameful and there's a double-standard. If the DOI was held to the same standard as insurance companies and had to pay financial penalties or reimbursements for their mistakes, they'd probably become insolvent. I'm amused everytime I hear the Commissioner say he's here to protect the consumer.

  • ghimmy51 Sep 15, 2010

    That's what the new health law does ... for the medical profession and the insurance industry.

  • mep Sep 15, 2010

    Good job!!!... but I still miss the old guy Jim Long.
    We need something like this overseeing the health insurance industry.