GEICO has filed a $300,000 federal lawsuit in Arizona against A&G Auto Glass for alleged fraudulent or non-reimbursable claims for windshield replacement services. GEICO claims that A&G Auto Glass did not actually provide the claimed replacement services and did not have the standing to file the insurance claims. The company is seeking reimbursement plus treble damages.
The defendants in the case, GEICO et al. v A&G Auto Glass, Inc, et al., include A&G Auto Glass, Inc.; Godfrey Companies, LLC doing business as A&G Auto Glass; and owners Sean Alexander, Terry Godfrey, and Anthon Godfrey.
Arizona does not require motorists to carry comprehensive automobile insurance coverage but, by law, insurers who offer such coverage are required to provide an option to cover repair or replacement of damage to any safety equipment, which includes windshields, without applying a deductible. The insured can make an Assignment of Benefits to their automotive glass shop of choice and the shop can then bill the insurance company for the windshield service.
GEICO lays out a case that insurance companies in Arizona are susceptible to auto glass claim fraud because of the high volume of claims under the no deductible/Assignment of Benefit (AOB) paradigm coupled with a short time frame, usually 30 days, for the insurance companies to pay claims. “Glass shops that engage in the types of fraudulent practices employed by the Defendants depend upon the volume of windshield repair and replacement claims, coupled with the limited amount of time in which insurers have to handle those claims, to shield their fraudulent activity from timely discovery,” said GEICO in its court filing.
The GEICO complaint alleges numerous instances where the defendant companies billed GEICO for windshield replacement services that they never performed or installed a much lower quality, and less expensive, windshield. The insurer alleges that in many cases the defendants generated two invoices; one for the insured showing the actual windshield installed and one for GEICO showing the more expensive windshield.
The GEICO claim also alleges that A&G Auto Glass did not, in many cases, have the standing to file the insurance claim either because the Assignment of Benefit that they received from the insured was for the lower quality windshield, and not the one billed to GEICO, or that they never received a valid Assignment of Benefit claim at all.
In addition to the damages claim, GEICO is seeking a declaration that it not responsible for more than $10,000 in outstanding claims filed by A&G Auto Glass and the related companies.
GEICO had filed a similar lawsuit in Arizona last year against Auto Glass Express.