COVID-19 Update: How We Are Serving and Protecting Our Clients

Articles Tagged with Lawsuit

48 Miles to Payson, Mazatzal Mountains, Beeline Highway, T… | Flickr
Famous auto insurance giants are being sued by policyholders for providing insufficient financial relief to motorists during the pandemic. Among those accused include: Allstate, Geico, Progressive, Erie Insurance, American Family Insurance, and The Travelers Company. These well-known insurers are currently facing major allegations by Illinois residents for their inappropriate rebates to financially unstable clients.

During the height of the pandemic, companies issued policies for their employees to work remotely from home. As stated in the lawsuits, miles driven by motorists dropped by almost two-thirds during the spring. In addition, the U.S. Bureau of Labor Statistics confirms that the rate of unemployment rose to 14.7% in April 2020. Previously, the rate was 10.3%, which they claim is the highest rate increase in the history of their data records. At this time, the statistics from the United States Department of Labor show that the number of people who were unemployed increased from 15.9 million to 23.1 million. Also, the governor of Illinois, J. B. Pritzker, announced that residents should stay at home to reduce exposure to COVID-19. As a result, people did not have to use their vehicles as often as they previously did.

However, insurance companies did not reduce premiums or rates during the pandemic. Now, multiple lawsuits are emerging against the insurers. In an Illinois Cook County Circuit Court, people protested that high rates have greatly affected their financial status. Although some of the alleged insurers offered some support to customers, it was not a significant amount that would cause the policyholders to drop the case. Clients state that a community State Farm offered its customers a 25% credit during March 20 to May 31 of this year. In contrast, a local Allstate in Northbrook offered a 15% credit for April, May, and June. Consequentially, the lawsuits accuse the companies responsible to be in violation of the Illinois Consumer Fraud and Deceptive Business Practices Act. The legislation protects consumers, borrowers, and business workers against fraud or deceptive actions in trade or business activities. As stated in the lawsuits, the clients expect that as long as the disease continues to spread, the abnormal amount of rebates will pursue.

uber lyft | uber lyft Credit www.quotecatalog.com with an ac… | Flickr
Popular ridesharing companies are currently facing extreme criticism for an undefined classification of their employees and for providing inadequate wages. People claim that Uber and Lyft are deliberately labeling drivers as “independent contractors” instead of employees. An Independent Contractor status means Uber and Lyft to not need to reimburse drivers for expenses such as mileage and car maintenance, nor are they required to pay drivers minimum wage, unemployment, and sick pay benefits, which as employees they would legally receive.

Uber Technologies, Inc. (Uber) is an American multi-purposeful company that has become a worldwide phenomenon since it was founded in 2009. According to Uber, there are currently 900,000 Uber drivers in the United States, and it is projected that there are about 3 million drivers throughout the world. Uber has announced that there are 75 million riders worldwide, and the company has completed 6.9 billion trips in 2019. Primarily located in the United States and Canada, Lyft, Inc. is another carpooling service that is similar to Uber. With over 1.4 million drivers, Lyft continues to expand its accessibility to clients in both countries. The two establishments employ drivers to offer a variety of services, including delivering food and providing rides for transportation. In fact, a majority of Uber drivers also work for Lyft. As the businesses continue to grow, the debate over the companies’ employee policies becomes more imminent.

The major lawsuits are predominantly occurring in California, where both companies are headquartered in San Francisco. In May, a lawsuit concerning the misclassification of drivers was opened. As a result of the case, a judge has allowed Uber and Lyft to change their classification of drivers as a preliminary injunction. If the companies fail to response to this decision, the judge will prohibit the terminology of drivers as independent employees. As stated by law in California, ridesharing establishments are required to announce their drivers as official employees. Following the previous and current lawsuits, California has updated strict and specific laws for people to be independent contractors. Since then, other numerous lawsuits have surfaced. California’s Labor Commissioner declared that the businesses are being charged for alleged wage theft. Also, they have been accused of not providing certain benefits for their workers that are mandatory under state law. Under the misinterpretation of drivers as independent contractors, they were not required to provide benefits. Now that the term is being viewed incorrectly, Uber and Lyft will have to compensate for the financial losses.

Contact Information