Adam Elgindy, et al. v. AGA Service Company, et al

 

Case Background

On December 21, 2022, Plaintiff Adam Elgindy and Julianne Chuanroong, on behalf of themselves, the general public, and those similarly situated, filed a Class action lawsuit in the United States District Court for the Northern District of California (Case number: 20-cv-06304). The lawsuit also addressed the issue of hidden insurance fees, allegedly charged unfairly in selling insurance policies. Judge Jon S. Tigar presided over this case.

Cause

Plaintiffs Adam Elgindy, Julianne Chuanroong, and Andrew Tasakos alleged that AGA Service Company (operating as Allianz Global Assistance), Jefferson Insurance Company, and BCS Insurance Company charged hidden insurance fees unfairly for insurance policies marketed online. These hidden fees were embedded in event ticket insurance and trip insurance offers sold on platforms like Ticketmaster and airline websites. The defendants bundled the assistance fees with the insurance premiums, violating consumer protection and insurance rate laws. The plaintiffs discovered these hidden charges only after purchasing their policies, as the fee breakdown was not disclosed during checkout but was buried in later policy documents.

Injuries

The plaintiffs suffered financial harm after unknowingly paying for “assistance services” that were bundled with the advertised insurance premiums. These services, marketed as providing customer support and travel-related information, were unnecessary and provided no real value. Consumers could access similar information for free online. The plaintiffs purchased insurance under the false impression that they were paying solely for the insurance premium, unaware of the hidden insurance fees included in the cost. This deceptive practice caused financial loss and violated their trust as consumers.

Damages

The plaintiffs incurred direct financial damages equal to the hidden insurance fees embedded in their insurance purchases. For example, Plaintiff Elgindy paid $18.50 for event ticket insurance, which included a $2.12 hidden insurance fee disguised within the premium. Similarly, Plaintiff Chuanroong faced varying hidden insurance fees across multiple trip insurance purchases, including a $4.37 fee on a $223.59 ticket and a $2.25 fee on a $158.20 ticket. These hidden fees were unlawful and inflated the cost of the insurance policies, causing economic harm to the plaintiffs and millions of other consumers.

Key Arguments and Proceedings

Legal representation

  • Plaintiff(s): Adam Elgindy | Andrew Tasakos | Julianne Chuanroong, on behalf of themselves, the general public, and those similarly situated
    • Counsel for Plaintiff: Seth A. Safier | Rajiv V. Thairan | Stephen M. Raab
  • Defendant(s): AGA Service Co. d/b/a Allianz Global Assistance | Jefferson Insurance Co. | BCS Insurance Co
    • Counsel for Defendants: Elizabeth J. Ireland | Gayle I. Jenkins

Claims

The plaintiffs brought claims under California and Washington consumer protection and insurance laws, asserting that the defendants engaged in unfair and deceptive business practices. These practices included:

  • Charging unapproved and undisclosed hidden insurance fees in violation of state insurance rate laws.
  • Misrepresenting the total cost of insurance by concealing the mandatory assistance fees.
  • Deceiving consumers into believing they were purchasing a single insurance product, while secretly adding unnecessary hidden insurance fees.
  • Failing to disclose material facts about the “assistance services,” such as their lack of practical value.

The plaintiffs sought injunctive relief to stop these practices, restitution for the hidden fees paid, and damages for the financial and emotional harm caused by the defendants’ unlawful actions. They demanded transparent disclosure of all charges in insurance offers to prevent further consumer exploitation.

Defense

The defendants asserted that they acted in compliance with all applicable laws and regulations when marketing and selling their insurance products. They argued that the assistance fees were a lawful component of the overall insurance package and were adequately disclosed in the policy documents provided to consumers. The defendants contended that the plaintiffs had the opportunity to review the terms and conditions, including the assistance services, before completing their purchases. They maintained that these services added value to the insurance policies by providing consumers with access to travel-related support and emergency resources. The defendants also stated that their practices aligned with industry standards and denied engaging in deceptive or unfair business practices. Furthermore, they claimed that any alleged damages were speculative and not directly attributable to their conduct.

Settlement

On October 29, 2024, Judge Jon S. Tigar granted final approval of a $19,750,000 settlement between the plaintiffs and defendants. The settlement addressed the hidden insurance fees charged by the defendants. The court awarded $4,937,500 in attorney fees and $188,870.47 in expenses to class counsel. Additionally, Judge Tigar approved $5,000 incentive awards for each of the three named plaintiffs, recognizing their role in representing the class and helping to uncover the deceptive practice of hidden insurance fees.

Court Documents:

Documents are available for purchase upon request at jurimatic@exlitem.com