Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 1 of 24 PageID #:275
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`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF ILLINOIS
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`Plaintiff,
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`Case No. 1:20-cv-04306
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`JURY TRIAL DEMANDED
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`BRIANA SIEGAL, individually and on behalf of
`all others similarly situated,
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`v.
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`GEICO CASUALTY COMPANY,
`GEICO INDEMNITY COMPANY, and
`GEICO GENERAL INSURANCE COMPANY,
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`Defendants.
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`FIRST AMENDED CLASS ACTION COMPLAINT
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`Plaintiff Briana Siegal (“Plaintiff”), by and through her attorneys and on behalf of herself
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`and all others similarly situated, hereby submits this First Amended Class Action Complaint
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`against Defendants GEICO Casualty Company, GEICO indemnity Company, and GEICO
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`General Insurance Company (“GEICO” or “Defendants”), and alleges as follows:
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`PRELIMINARY STATEMENT
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`This case is filed to end GEICO’s practice of unfairly profiting from the global
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`1.
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`COVID-19 pandemic. As of the date of this filing, the United States has confirmed well over 6
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`million coronavirus cases, and over 200,000 deaths. The State of Illinois alone has over 250,000
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`confirmed cases and more than 8,500 deaths. The numbers continue to rise.
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`2.
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`Beginning in March 2020, states across the country, including Illinois, began to
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`enforce strict social distancing measures to slow the spread of COVID-19. This included closing
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`schools and businesses and instituting strict “stay-at-home” orders that prevented most
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`individuals from leaving their homes for extended periods of time.
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 2 of 24 PageID #:276
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`3.
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`While many companies, industries, and individuals have suffered as a result of the
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`COVID-19 pandemic, auto insurers like GEICO have scored a windfall. Not surprisingly, as a
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`result of state-wide social distancing and stay-at-home measures, there has been a dramatic
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`reduction in driving, and an attendant reduction in driving-related accidents. As a result of this
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`decrease in driving and accidents, the premiums charged by auto insurance companies during the
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`COVID-19 pandemic, including GEICO, are unconscionably excessive. One published report
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`calculates, very conservatively, that at least a 30% average refund of paid premiums would be
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`required to make up for the excess amounts paid by consumers for just the period between mid-
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`March and the end of April.
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`4.
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`Despite full knowledge of these facts, GEICO has continued to charge and collect
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`excessive premiums, and has failed to issue adequate refunds. The company’s “GEICO
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`Giveback” program is woefully inadequate to compensate for the excessive premiums that
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`customers have paid as a result of COVID-19. The program applies a 15% discount on new and
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`renewal auto insurance policies only. It does not apply to the premiums that the customer has
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`already paid or will continue to pay on policies already existing at the start of the COVID-19
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`pandemic. And even with respect to new and renewal policies, the 15% credit falls well short of
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`what has been conservatively estimated as an adequate return of premiums.
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`5.
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`To remedy Defendants' unlawful conduct, Plaintiff brings this class action
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`alleging violations of Illinois state law. Plaintiff seeks disgorgement of the ill-gotten gains
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`obtained by GEICO to the detriment of its customers, all available damages, punitive damages,
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`declaratory and injunctive relief, and all other available relief.
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`2
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 3 of 24 PageID #:277
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`JURISDICTION AND VENUE
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`This Court has jurisdiction under 28 U.S.C. § 1332(d) because this is a class
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`6.
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`action in which the amount in controversy is over $5,000,000 exclusive of interest and costs, and
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`at least one member of the class is a citizen of a State different from Defendants.
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`7.
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`Venue is proper in the United States District Court for the Northern District of
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`Illinois under 28 U.S.C. § 1391 because Defendants reside in this district, and because a
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`substantial part of the events or omissions giving rise to the claims occurred in this district.
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`PARTIES
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`Defendants GEICO Casualty Company, GEICO Indemnity Company, and
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`8.
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`GEICO General Insurance Company are Maryland corporations with their principal place of
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`business in Chevy Chase, Maryland. Defendants sell personal automobile insurance in states
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`around the country, including Illinois. GEICO issued personal auto, motorcycle, and/or RV
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`insurance policies to Plaintiff and the members of the putative class during the relevant time
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`period.
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`9.
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`Plaintiff is an adult resident of Chicago, Illinois. Plaintiff has held two personal
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`auto insurance policies purchased from GEICO during the time period relevant to this lawsuit.
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`As described in more detail herein, as a result of the global COVID-19 pandemic and
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`corresponding drop in automobile use and traffic, the premiums paid by Plaintiff for these
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`policies were unconscionably excessive. Despite this, GEICO failed to issue full refunds.
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`FACTUAL ALLEGATIONS COMMON TO ALL CLAIMS
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`The Global COVID-19 Pandemic and State-Mandated Social Distancing Measures
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`10.
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`In late December 2019, a cluster of cases of pneumonia was reported in Wuhan,
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`A.
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`China. A novel coronavirus was identified, which became known as SARS-CoV-2. The virus
`3
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 4 of 24 PageID #:278
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`causes a disease called COVID-19. By mid-January, cases of COVID-19 were confirmed in the
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`United States, and the virus quickly spread.
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`11.
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`By mid-March, there were thousands of confirmed cases of COVID-19 across the
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`United States and well over 100 in the State of Illinois alone.
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`12.
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`Like many states around the country, Illinois responded to the worsening COVID-
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`19 crisis with a series of measures designed to increase, and often mandate, social distancing in
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`order to slow the spread of the virus.
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`13.
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`On March 9, 2020, Governor J. B. Pritzker issued a disaster proclamation,
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`declaring all counties in the State of Illinois a disaster area. Thereafter, the state rolled out a
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`variety of social distancing measures that included, for example, the closing of schools, bars,
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`restaurants, and casinos, and cancellation of all gatherings of 50 or more people.
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`14.
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`On March 21, Governor Pritzker instituted a statewide stay-at-home order. With
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`some exceptions, the order mandated that all individuals living within the State of Illinois were
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`to stay at home or at their place of residence and were allowed to leave only for essential
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`activities or other specified reasons.1 The order mandated that: “[a]ll travel, including, but not
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`limited to, travel by automobile, motorcycle, scooter, bicycle, train, plane, or public transit,
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`except Essential Travel and Essential Activities as defined herein, is prohibited.” 2
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`15.
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`The stay-at-home order was scheduled to remain in place until April 7, 2020.
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`However, due to the increasing severity of the COVID-19 crisis, Governor Pritzker extended the
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`order until April 30, 2020, and again to May 29, 2020. Just as in the original stay-at-home order,
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`1 See COVID-19 Executive Order No. 8 § 1(1) (Mar. 20, 2020),
`https://www2.illinois.gov/Pages/Executive-Orders/ExecutiveOrder2020-10.aspx.
`2 Id. § 1(4).
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 5 of 24 PageID #:279
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`the Governor ordered that “[a]ll travel, including, but not limited to, travel by automobile,
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`motorcycle, scooter, bicycle, train, plane, or public transit, except Essential Travel and Essential
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`Activities as defined herein, is prohibited.” 3
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`16.
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`On May 5, 2020, Governor Pritzker unveiled “Restore Illinois,” a plan to slowly
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`reopen the state in five phases. But progress has been slow, and the state is still far from
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`achieving full reopening and economic recovery. Indeed, even under the current stage—Phase 4
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`“Revitalization”—businesses in all industries are instructed to permit employees to work from
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`home when it is possible to do so.
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`17.
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`In addition to the measures it has taken to slow the spread of the virus, the State of
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`Illinois has also sought to stop unscrupulous businesses from profiting from the pandemic. The
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`Illinois Attorney General has urged consumers to report price-gouging and fraud as a result of
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`COVID-19, reflecting a public policy against taking financial advantage of the pandemic.
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`B.
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`GEICO Has Obtained a Windfall Due to the Dramatic Decrease in Automobile Use
`and Traffic Caused by COVID-19
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`18.
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`Although businesses across the United States have almost uniformly suffered as a
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`result of COVID-19, state-wide stay-at-home orders, and other social distancing measures, the
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`auto insurance industry has benefited. In fact, auto insurance—a $250 billion industry—stands to
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`secure a windfall from COVID-19. The reason is simple. As one recent report put it: “With
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`shelter-in-place restrictions and business closings, most people stopped driving or reduced their
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`3 See COVID-19 Executive Order No. 30 § 2(4) (Apr. 30, 2020),
`https://www2.illinois.gov/Pages/Executive-Orders/ExecutiveOrder2020-32.aspx.
`5
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 6 of 24 PageID #:280
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`driving dramatically. With fewer cars on the road, there were dramatically fewer accidents.
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`Fewer motor vehicle accidents mean fewer auto insurance claims.”4
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`19.
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`Beginning in mid-March of 2020, the number of miles driven by individuals has
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`dropped dramatically because of COVID-19. This includes the State of Illinois. Through the use
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`of cell phone location data, it has been reported that vehicle miles traveled in Illinois dropped
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`significantly from their January 2020 average in March and April of 2020:5
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`Date Range
`March 15 - March 21
`March 22 - March 28
`March 29 - April 4
`April 5 - April 11
`April 12 - April 18
`April 19 - April 25
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`Decrease in Miles Traveled
`-42%
`-67%
`-67%
`-67%
`-68%
`-64%
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`Upon information and belief, decreases in pre-COVID miles traveled continued in May, June,
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`July, and August 2020, and will continue for the foreseeable future.6
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`20.
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`Automobile accidents have also decreased. For example, the Illinois State Police
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`reported that between April 1, 2020 and April 26, 2020 alone, statewide car crash rates dropped
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`by more than half when compared to 2019 rates.7 Although GEICO does not report crash
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`4 See Center for Economic Justice & Consumer Federation of America, Personal Auto Insurance
`Premium Relief in the COVID-19 Era at 5 (May 7, 2020) (“CEJ/CFA Report”),
`https://consumerfed.org/wp-content/uploads/2020/05/Auto-Insurance-Refunds-COVID-19-
`Update-Report-5-7-20.pdf.
`5 See id. at 6-8.
`6 See id. at 2.
`7 Mary Wisniewski, With fewer people on the roads, crashes are down — but some drivers see
`lack of traffic as excuse to speed, Chicago Tribune, May 1, 2020,
`https://www.chicagotribune.com/coronavirus/ct-coronavirus-speeding-up-crashes-down-
`20200501-vgr3yinpibh3xkmc45dmvxycwa-story.html.
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 7 of 24 PageID #:281
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`statistics to the State of Illinois, a submission to Ohio regulators estimated a decline in claims
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`frequency between 25% and 50%.8
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`21.
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`As a result of this dramatic decrease in driving and auto accidents, the rates set—
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`and thus the premiums charged—by auto insurance companies during the COVID-19 pandemic,
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`including GEICO, are unconscionably excessive. Auto insurance rates, including those set by
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`GEICO, are intended to cover the claims and expenses that they expect to occur in the future,
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`extrapolated from historical data. Thus, as explained in the recent joint report by the Center for
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`Economic Justice and the Consumer Federation of America:
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`Because of COVID-19 restrictions, the assumptions about future claims underlying
`insurers’ rates in effect on March 1 became radically incorrect overnight. When roads
`emptied, the frequency of motor vehicle accidents and insurance claims dropped
`dramatically and immediately. The assumptions in insurers’ rates covering time-frames
`from mid-March forward about future frequency of claims became significantly wrong
`when the roads emptied because of Stay-At-Home orders and business closures starting
`in mid-March. The then-current rates became excessive not just for new policyholders
`going forward, but also for existing policyholders whose premium was based on now-
`overstated expectation about insurance claims.9
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`22.
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`The excessive premiums collected by GEICO during the COVID-19 pandemic
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`have led to a substantial windfall in profits. It has been reported that for the first quarter of 2020
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`alone, GEICO generated a pretax underwriting gain of $984 million.10 This was an increase of
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`27.8% from result for the same period in 2019. And according to its parent company, Berkshire
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`8 Geico’s claim frequency falling even faster than Q1 data shows, S&P Global (May 4, 2020),
`https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/geico-s-
`claims-frequency-falling-even-faster-than-q1-data-shows-58431662.
`9 CEJ/CFA Report, supra, at 4.
`10 Geico’s claim frequency falling even faster than Q1 data shows, S&P Global (May 4, 2020),
`https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/geico-s-
`claims-frequency-falling-even-faster-than-q1-data-shows-58431662.
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 8 of 24 PageID #:282
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`Hathaway, in the second quarter of 2020, GEICO generated pre-tax underwriting earnings of
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`$2.1 billion, which was an increase of 424% compared to the second quarter of 2019.
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`23.
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`GEICO’s astonishing windfall is a direct result of the fact that its premiums are
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`excessive and not based on an accurate assessment of risk since the pandemic began, in violation
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`of Illinois public policy.
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`24.
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`In modern society, most people must drive, and therefore must buy insurance in
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`order to go about their daily lives. Because people must, as a practical matter, buy auto
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`insurance, Illinois courts have long held that insurance policies implicate the public interest, and
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`that rates must be based on risk.
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`C.
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`GEICO Has Failed to Refund Excessive Premiums to Plaintiff and Other
`Policyholders in Illinois
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`25.
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`According to conservative calculations by the Center for Economic Justice and
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`the Consumer Federation of America based on motor vehicle accident data, at least a 30%
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`minimum average premium refund to consumers would be required to correct the unfair windfall
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`to auto insurance companies, including GEICO, just for the time period from mid-March through
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`the end of April 2020.11
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`26.
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`At all relevant times, GEICO has been aware of the excessive premiums that it
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`has charged to and collected from policyholders in Illinois as a result of the COVID-19 crisis.
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`GEICO has likewise been aware of its excessive profits. Despite this, GEICO has failed to
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`adequately return these profits to its customers.
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`11 CEJ/CFA Report, supra, at 12-13.
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`27.
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`In spring 2020, GEICO announced the “GEICO Giveback.” Under the program,
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`GEICO will give customers a 15% credit on their personal auto insurance premiums, but only if
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`they are new customers, or existing customers who renew their policy during the applicable time
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`period. Specifically, the credit is given for six-month policies renewed or newly purchased
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`between April 8, 2020 and October 8, 2020 and twelve-month policies renewed or newly
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`purchased between April 8, 2020 and October 7, 2021.
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`28.
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`GEICO’s credit program is inadequate to compensate for the excessive premiums
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`that its customers have paid as a result of COVID-19. For existing customers who renew their
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`policies, the credit does not apply at all to excessive premiums that the customer paid on their
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`previous policies. And even with respect to new and renewal policies, the 15% credit is nowhere
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`near the minimum 30% average refund benchmark that has been conservatively estimated as an
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`adequate refund of premiums.
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`29. With full knowledge that its refund program was inadequate, GEICO has falsely
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`claimed to its customers that it is in fact providing substantial and full relief. For example, on its
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`website, GEICO falsely claims that “shelter in place laws have reduced driving, and we are
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`passing these savings on to our auto, motorcycle, and RV customers.”12 GEICO does not
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`disclose that its program does not, in fact, fully pass the company’s saving on to its customers,
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`and GEICO does not disclose the amount of its excessive profits.
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`30.
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`Not surprisingly, GEICO’s credit program has been met with immediate criticism.
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`On April 13, 2020, the Consumer Federation of America gave GEICO’s program a “D-” grade,
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`12 FAQs About The Geico Giveback, https://www.geico.com/about/coronavirus/giveback/ (last
`visited September 15, 2020).
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 10 of 24 PageID #:284
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`which places GEICO at or near the bottom of insurers receiving grades.13 The CEJ/CFA report
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`explains that GEICO’s program “fails to match the relief to the relevant premium and policy,”
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`“doesn’t provide relief for current policyholders,” “fails to credit consumers for the current
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`premium that has become excessive,” and is “wrongly attempting to take credit for future – and
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`in most cases distant future – rate reductions as if it were actually providing relief today to
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`current policyholders.”14
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`31.
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`GEICO does not disclose the fact that its program compares unfavorably with the
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`refund programs of all or nearly all other major auto insurers.
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`32.
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`In late 2019, Plaintiff purchased a renewal auto insurance policy from GEICO for
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`the period beginning on December 1, 2019 and ending on June 1, 2020. Plaintiff paid $945.57 in
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`premiums for that policy. Plaintiff again renewed for the period beginning on June 1, 2020 and
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`ending on December 1, 2020. Premiums were $900.66. With a “GEICO Giveback credit” of
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`$135.10, Plaintiff paid $765.56 in premiums for that policy. Plaintiff’s declarations page also
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`reflects several other non-COVID discounts. Upon information and belief, Plaintiff never
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`received these discounts.
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`33.
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`GEICO’s insurance policies, including the policies of Plaintiff and the members
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`of the putative class, contain the following provision:
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`CHANGES
`3.
`The terms and provisions of this policy cannot be waived or changed,
`except by an endorsement issued to form a part of this policy.
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`13 Report Card to Date on the $6.5 Billion+ Promised To Auto Insurance Customers as People
`Drive Less Due To COVID-19, Consumer Federation of America (April 4, 2020),
`https://consumerfed.org/press_release/report-card-to-date-on-the-6-5-billion-promised-to-auto-
`insurance-customers-as-people-drive-less-due-to-covid-19/.
`14 CEJ/CFA Report, supra, at 16.
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 11 of 24 PageID #:285
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`We may revise this policy during its term to provide more coverage
`without an increase in premium. If we do so, your policy will
`automatically include the broader coverage when effective in your state.
`The premium for each auto is based on the information we have in your
`file. You agree:
`(a) That we may adjust your policy premiums during the policy term if
`any of this information on which the premiums are based is incorrect,
`incomplete or changed.
`(b) That you will cooperate with us in determining if this information is
`correct and complete.
`(c) That you will notify us of any changes in this information.
`(d) That we may adjust your policy premium during the policy term or at
`renewal if any person who is an insured becomes an additional driver
`during the policy term or at renewal.
`Any calculation or recalculation of your premium or changes in your
`coverage will be based on the rules, rates and forms on file, if required, for
`our use in your state.
`This provision gives GEICO broad discretion to adjust premiums if the
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`34.
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`information on which those premiums is based changes or becomes incorrect.
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`35.
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`Plaintiff’s policies described above were in effect during the time period during
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`which most of the United States, including Illinois, was significantly impacted by the global
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`COVID-19 pandemic and during which stay-at-home orders, along with other measures and
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`conditions, caused a widespread and dramatic decrease in automobile use and traffic. Despite
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`this, GEICO only gave Plaintiff an inadequate 15% credit on her most recent renewal policy and
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`no refund or credit for Plaintiff’s previous policy.
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`36.
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`Upon information and belief, thousands of other policyholders in Illinois have
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`been injured by GEICO’s policy and practice of charging and failing to refund excessive auto
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`insurance premiums to policyholders due to the COVID-19 pandemic.
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`11
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 12 of 24 PageID #:286
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`CLASS ACTION ALLEGATIONS
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`37.
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`Pursuant to Fed. R. Civ. P. 23(a) and 23(b), Plaintiff brings this action
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`individually and on behalf of all similarly situated individuals.
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`38.
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`The proposed class is defined as follows: All Illinois residents who purchased
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`personal automobile, motorcycle, or RV insurance from GEICO covering any portion of the time
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`period from March 21, 2020 to the present.
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`39.
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`The members of the class are so numerous that joinder of all members is
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`impracticable. While the precise number of class members has not been determined at this time,
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`upon information and belief, there are thousands of individuals in the class. The identities of the
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`class members can be determined from GEICO’s records.
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`40.
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`There are questions of law and fact common to the class that predominate over
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`questions solely affecting individual members.
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`41.
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`The common questions of law and fact include, but are not limited to:
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`a. Whether GEICO has a common policy or practice of charging and failing to
`fully refund excessive auto insurance premiums to policyholders due to the
`COVID-19 pandemic;
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`b. Whether GEICO’s insurance rates and premiums were excessive;
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`c. Whether GEICO violated the covenant of fair dealing and good faith;
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`d. Whether the payment of full premiums by Plaintiff and the members of the
`putative class is excused by frustration of purpose;
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`e. Whether GEICO was unjustly enriched as a result of its charging and failure
`to fully refund excessive auto insurance premiums;
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`f. Whether GEICO’s charging and failure to fully refund excessive auto
`insurance premiums offends public policy;
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`g. Whether GEICO’s charging and failure to fully refund excessive auto
`insurance premiums is immoral, unethical, oppressive, or unscrupulous;
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 13 of 24 PageID #:287
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`h. Whether GEICO has violated ICFA through its charging and failure to fully
`refund excessive auto insurance premiums; and
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`the proper measure and calculation of damages.
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`i.
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`42.
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`The questions of law and fact listed above will yield common answers for
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`Plaintiff and the class as to whether GEICO is liable for the alleged legal violations.
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`43.
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`Plaintiff’s claims are typical of those of the members of the class. Plaintiff, like
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`other class members, was subject to the unlawful practices described herein.
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`44.
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`Plaintiff will fairly and adequately protect the interests of the class and has
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`retained counsel experienced in complex class action litigation.
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`45.
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`Class treatment is appropriate under Fed. R. Civ. P. 23(b)(2) because GEICO has
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`acted on grounds that apply generally to the class, so that final injunctive relief or corresponding
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`declaratory relief is appropriate with respect to the class.
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`46.
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`This action is properly maintainable as a class action under Fed. R. Civ. P.
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`23(b)(3) because questions of law or fact predominate over any questions affecting individual
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`class members. A class action is superior to other methods in order to ensure a fair and efficient
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`adjudication of this controversy because, in the context of similar litigation, individual plaintiffs
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`often lack the financial resources to vigorously prosecute separate lawsuits in federal court
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`against large corporate defendants. Class litigation is also superior because it will preclude the
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`need for unduly duplicative litigation resulting in inconsistent judgments pertaining to GEICO’s
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`policies and practices. There will be no difficulties in managing this action.
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`47.
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`In the alternative, class treatment is appropriate under Fed. R. Civ. P. 23(c)(4)
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`because this is a case in which class adjudication of particular issues would serve the interests of
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`judicial economy.
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`13
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`Case: 1:20-cv-04306 Document #: 20 Filed: 09/24/20 Page 14 of 24 PageID #:288
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`CAUSES OF ACTION
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`COUNT I
`Breach of Contract
`(On Behalf of Plaintiff and the Putative Class)
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`Plaintiff restates and incorporates by reference the above paragraphs as if fully set
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`48.
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`forth herein.
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`49.
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`The insurance policies GEICO issued to Plaintiff and the putative class are
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`contracts.
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`50.
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`Plaintiff and the members of the putative class performed under those contracts by
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`paying the policy premiums.
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`51.
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`GEICO’s insurance contracts give GEICO the discretion to adjust premiums if the
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`information on which those premiums is based changes or becomes incorrect.
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`52.
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`Under Illinois law, a covenant of fair dealing and good faith is implied into every
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`contract. A party is not permitted to engage in opportunistic advantage-taking, or lack of
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`cooperation depriving the other contracting party of their reasonable expectations. A contracting
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`party breaches the covenant when it exercises its discretion under the contract in bad faith.
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`53.
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`GEICO breached the insurance contracts by exercising its contractual discretion
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`in violation of the covenant of fair dealing and good faith. GEICO had discretion to adjust or
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`refund the premiums when the information underlying the premiums become incorrect,
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`incomplete, or changed. That information changed and became incomplete and incorrect when
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`the COVID-19 pandemic emptied Illinois’s roads. But GEICO failed to exercise its contractual
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`discretion to properly reduce or refund the now-excessive premiums.
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`54.
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`GEICO exercised its contractual discretion unreasonably, without proper motive,
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`in a manner inconsistent with the parties’ reasonable expectations, and in bad faith.
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`55.
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`By profiting from the uncontemplated and unforeseeable COVID-19 pandemic,
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`GEICO has engaged in opportunistic advantage-taking and lack of cooperation, depriving
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`Plaintiff and the putative class of their reasonable expectations under the insurance contracts.
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`56.
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`GEICO has injured Plaintiff and the members of the putative class by retaining
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`their excessive premium payments and by not reducing or refunding those excessive premiums.
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`These injuries are a direct and proximate result of GEICO’s unlawful conduct.
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`COUNT II
`Declaratory Relief—Frustration of Purpose
`(On Behalf of Plaintiff and the Putative Class)
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`Plaintiff restates and incorporates by reference the above paragraphs as if fully set
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`Plaintiff pleads this Count II in the alternative to Count I.
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`Under Illinois law, a party’s performance of a contract is excused when the
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`57.
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`forth herein.
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`58.
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`59.
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`purpose of the contract is frustrated by an event that was not reasonably foreseeable at the time
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`the contract was formed, and the value of the contract has been nearly totally destroyed by the
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`frustrating event.
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`60.
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`At the time Plaintiff and the members of the putative class purchased insurance
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`policies from GEICO, the global COVID-19 pandemic and its effects were not reasonably
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`foreseeable.
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`61.
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`As a result of the global COVID-19 pandemic, the related stay-at-home orders,
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`and the drastic reduction in driving among the risk pool, the purpose of the policies—providing
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`insurance coverage at rates based on an accurate assessment of risk—has been frustrated, and the
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`value of the policies has been totally or nearly totally destroyed.
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`62.
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`Plaintiff and the members of the putative class seek a declaration that full
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`payment of premiums is no longer required, and that any excessive premiums paid to date must
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`be disgorged by GEICO.
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`COUNT III
`Illinois Consumer Fraud and Deceptive Business Practices Act – Unfairness
`(On Behalf of Plaintiff and the Putative Class)
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`Plaintiff restates and incorporates by reference the above paragraphs as if fully set
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`63.
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`forth herein.
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`64.
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`The Illinois Consumer Fraud and Deceptive Business Practices Act (“ICFA”)
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`makes unlawful:
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`Unfair methods of competition and unfair or deceptive acts or practices, including but not
`limited to the use or employment of any deception, fraud, false pretense, false promise,
`misrepresentation or the concealment, suppression or omission of any material fact, with
`intent that others rely upon the concealment, suppression or omission of such material
`fact, or the use or employment of any practice described in Section 2 of the “Uniform
`Deceptive Trade Practices Act”, approved August 5, 1965,1 in the conduct of any trade
`or commerce are hereby declared unlawful whether any person has in fact been misled,
`deceived or damaged thereby.
`815 ILCS 505/2.
`GEICO has violated and continues to violate ICFA by, at least, charging and
`65.
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`failing to fully refund unconscionably excessive premiums with full knowledge of the amount
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`and extent of their excess; failing to refund unconscionably excessive premiums to the
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`consumers who initially paid those premiums, and instead giving a credit only for new or
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`renewal business, thereby intentionally using the global COVID-19 pandemic as a means to gain
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`new business and obtain unfair economic advantage; falsely claiming to its customers that it is
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`providing substantial and full relief through its “Giveback” program and failing to disclose that
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`the program does not, in fact, provide full relief; failing to disclose the fact that it is earning
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`excessive profits, or the amount of those profits; failing to disclose the fact that its “GEICO
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`Giveback” program compares unfavorably with the refund programs of all or nearly all other
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`major auto insurers; and violating fundamental principles of rate-setting by failing to charge
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`premiums that reflect an accurate assessment of risk.
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`66.
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`GEICO’s unfair conduct, as described herein, is intentional, and GEICO intends
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`for consumers to rely on its unfair and misleading practices.
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`67.
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`GEICO’s unfair conduct, as described herein, occurred in the course of trade or
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`commerce.
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`68.
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`GEICO’s conduct, as described herein, violates ICFA because it (1) offends
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`public policy; (2) is immoral, unethical, oppressive, or unscrupulous; and (3) causes substantial
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`injury to consumers.
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`69.
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`GEICO’s conduct offends the public policy of Illinois that insurance premiums
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`are to be based on risk. The premiums charged and collected by GEICO are excessive and not
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`based on risk after the COVID-19 pandemic dramatically reduced the amount of driving and the
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`number of insurance claims.
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`70.
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`GEICO’s conduct offends public policy reflected in the State of Illinois’s desire to
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`curb and urge the reporting of price-gouging and fraud as a result of COVID-19, reflecting a
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`public policy against taking financial advantage of the pandemic. GEICO is violating that policy
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`through its conduct described herein.
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`71.
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`GEICO’s conduct, as described herein, is immoral, unethical and unscrupulous
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`because GEICO has taken advantage of the global COVID-19 pandemic for its own financial
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`gain. Further, GEICO’s conduct in claiming to pass its savings from the pandemic on to its
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`customers is oppressive because it would cause consumers, including Plaintiff and the members
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`of the putative class,