Insurance Company Accused of Unfairly Denying Claims in Lawsuit by California Drivers

OXNARD, Calif. – A car accident in Oxnard, California left Andy Nguyen with regrets after attempting a U-turn resulted in him crashing his car into a light pole. The impact not only caused significant damage to his car but also knocked down the pole and set off the airbags. Nguyen immediately contacted his insurance company, National General, to file a claim but was met with a series of unusual questions from the adjuster.

The adjuster asked Nguyen who else lived in his home, and he provided the information about his parents, 20-year-old brother, and 14-year-old sister. However, Nguyen soon realized that this information became the basis for the denial of his claim. He was sent a rescission notice, which essentially rescinded his policy and left him responsible for the $12,000 in damages caused to the city property.

Nguyen’s experience was not unique. Sergio Preciado of San Diego had a similar encounter with National General after causing a car accident. Preciado’s claim was denied and his policy rescinded because he failed to disclose that he had a 20-year-old son living at home. Despite the fact that his son was not involved in the accident, Preciado had to foot the $5,000 bill for the damages he caused.

In response to such denials, attorney Justin King has filed a lawsuit against National General on behalf of Nguyen and nearly 300 other drivers. The lawsuit accuses the insurance company of unfairly denying claims and seeks certification as a class action lawsuit. According to King, the digital application used by National General can be misleading, leading applicants to believe they only need to disclose drivers of the vehicle and not all household members.

Marisol Alvarez, a former insurance broker and expert witness in King’s lawsuit, expressed surprise at National General’s denial of claims based on undisclosed household members. She explained that the industry standard had always been to disclose 16-year-olds who may be driving the applicant’s vehicle, and no other company she worked with denied coverage due to someone living at home who wasn’t involved in the accident.

National General has issued a general denial of all allegations in the lawsuit and has not responded to requests for comment from NBC 7 Responds. The California Department of Insurance has been made aware of the lawsuit but cannot comment on it. Nguyen hopes that the department will investigate National General’s practices, as he believes their strategy of denying claims tarnishes the entire auto insurance industry.