Wednesday, November 30, 2016

Allstate to pay $600,000 to the government, not customers, to settle lawsuit over 'Accident Forgiveness' plan... that is not /was not - available in California

In June 2012, Northbrook, Illinois-based Allstate launched a nationwide television ad campaign for auto insurance focused on the consumer benefits of Allstate's "Accident Forgiveness" program. Certain ads were prepared exclusively for the Spanish-speaking community, while the majority of the ads were targeted at a more general audience. Allstate officials estimate that this ad campaign reached 90 percent of the households in California.

Under Proposition 103, the California Department of Insurance prohibits the offering of programs of accident forgiveness in auto insurance policies in California.

California law requires that all advertising must clearly and conspicuously disclose any material facts that viewers need to avoid being misled. Prosecutors alleged that the disclaimers in the Allstate "Accident Forgiveness" ads were unlawful under the advertising disclosure standards of California's false advertising law and Unfair Competition Law, and that the ads convey an overall impression that California consumers would receive the benefit as part of Allstate's car insurance.

The settlement was obtained by the San Diego County District Attorney's Consumer Protection Unit working with the Riverside and Los Angeles District Attorneys' Offices.

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