Hagens Berman

Class Action Lawsuit Accuses Allstate of Unlawfully Denying Insurance Benefits to Thousands of California Claimants

A California man launched a class-action lawsuit against Allstate Corp. accusing the insurance company and its subsidiaries of breaching its contracts with California insureds and unlawfully denying benefits to thousands of claimants, according to attorneys at Nunes Law and Hagens Berman.

The lawsuit, filed May 3, 2024, in the Superior Court of California, County of Fresno, states that Allstate’s recent corporate-level decisions violate California law dictating how uninsured motorist (UM) and underinsured motorist (UIM) benefits must be calculated, leaving California claimants receiving less than what they are owed. Attorneys say Allstate has increased its rates charged to California consumers by an average of 30%.

“We believe that California’s Uninsured Motorist Act makes clear that insureds have rights to certain benefits and compensation under their policies,” said Frank Nunes, President of Nunes Law, a Fresno-based consumer and personal injury firm. “We intend to fight for the thousands of Californians we believe were underpaid because of Allstate’s corporate-level decisions.”

According to the lawyers for the insured, Californians who settled a UM/UIM claim in which the insurer deducted workers’ compensation benefits from the claim may be entitled to more compensation even if the claim settled a year or two ago. Learn more about your rights and potential compensation.

California Allstate UM/UIM Benefits Explained

The lawsuit states that California law has established rules regarding how UM/UIM benefits must be calculated in the context of employees injured in the scope of their employment, yet, “Allstate routinely violates these rules by reducing UM/UIM benefits for individual insureds using workers’ compensation payments made to different insureds.”

“The law does not allow Allstate to write (or interpret) its policy language in a way that effectively ‘transfers’ its workers’ compensation offset between different individual insureds,” the lawsuit states.

In addition to its alleged denial of benefits in this manner, Allstate is also accused of failing to abide by its own policy language, which attorneys say limits the types of losses that can be offset using workers’ compensation benefits. An insurer can always provide more benefits than required by law, and Allstate did so but then refused to follow its own language, according to the complaint.