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Letter to the Editor
Wednesday June 6
National Auto Agents Alliance Starts Multi-Million-Dollar Class Action Lawsuit Against Auto Insurance Companies
CLEARWATER, Fla. -- A multi-million-dollar class-action lawsuit has been authorized by the Board of Directors of the National Auto Agents Alliance (NAAA) against several insurers.
The Auto Agents Alliance questions the legality of insurers reducing agent's compensation expenses without reducing charges to consumers.
The NAAA action comes in the wake of continuing slashes in agent compensation of 25 to 100 percent in some states, eliminating the agent's ability to provide quality service contracted to policyholders.
Subsequent to receiving approval of rates based on anticipated expense factors, some insurance companies have been reducing agent compensation expenses sharply without obtaining prior regulatory approval or passing on these reductions to the consumer.
The National Auto Agents Alliance, representing thousands of agents and millions of policyholders across the U.S., believes that consumers suffer when their agents are financially unable to provide quality service for which the consumer paid.
NAAA President, James W. Holthaus, stated: "It is unfortunate that we have been forced to take this action but feel this is the right direction to take for both our member independent agents and the consumers they represent."
The National Auto Agents, formed in 1995, is a trade group representing independent auto insurance agents in 18 states.
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