All About USAA Lawsuits

A class action lawsuit was filed in Texas against USAA on behalf of policy holders whose vehicles were considered total losses by USAA insurance department, with registrations revoked and vehicles titled as non-repairable or salvage without owner consent. USAA allegedly appraised the value of cars and when determining that it would cost more money to fix the car compared to the value of the car, deemed it a total loss without owner consent. 

USAA faced another lawsuit in Texas where it settled in August of 2021 $90 million. In this case it was alleged that USAA Life Insurance systematically overcharged certain policyholders, especially those who had universal life insurance policies. universal life insurance policies did not come with fixed premium monthly rates and change based on the market conditions. This lawsuit alleged that USAA overcharged policyholders with inflated rates outside of the factors legally allowed which extends to age, sex, and rate class.

One customer sued USAA over unfair debt collection procedures. Henry Holmes, a resident of Georgia, filed a lawsuit in Nevada federal court stating that between February 11th and June 30th you received over 125 calls from USAA, interrupting his work, calling multiple times per day, and violating the telephone consumer protection act. In a similar case, also filed in the District Court of Nevada, an Arkansas resident alleged that USAA violated the telephone consumer protection act by calling her at least 100 times between February and June to collect on an alleged debt. Covid and a divorce and interfered with her work schedule so in spite of being asked to only be contacted by mail, multiple calls happen every day.

A lawsuit in 2022 alleged that USAA profited unfairly during the pandemic. A car insurance customer sued USAA saying that they charged customers high insurance premiums during the pandemic even when customers were not driving. This case was presented in the state of California. The lawsuit found that there was a dramatic reduction in driving which meant a dramatic reduction and driving related accidents because of stay at home orders and yet premiums were not significantly reduced as a direct result when they should have been.

Remember how government agencies and regulatory bodies are usually the ones who bring class action lawsuits against big banks like USAA? 

That’s exactly what has happened multiple times. USAA Federal Savings Bank faced a charge by the CFPB in 2019 for a consumer protection violation and was charged with a penalty over 15 million dollars. The OCC levied another banking violation charge against USAA Federal Savings Bank in 2020 with a penalty of 85 million dollars.

In 2018 the state of Virginia issued an insurance violation against USAA Casualty Insurance to the tune of 4 million dollars. In Massachusetts in 2010, a consumer protection violation was put against the USAA automobile Department with a fine of 2 million dollars.