Travel insurance buyers say AIG, United units are misleading them

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Law360 (May 26, 2021, 8:02 p.m. EDT) – United Airlines and two AIG units have been hit by a proposed class action lawsuit accusing them of deceiving customers by advertising and selling travel insurance for charges United had waived in Coronavirus pandemic.

William Arce, a potential traveler to Mexico, told a New Jersey federal court on Tuesday that he would never have purchased travel insurance for his flight to Cabo San Lucas had he known that United had issued a policy to waive flight change fees and provide vouchers for voluntary cancellations. The AIG units that partnered with United and are named in the lawsuit are Travel Guard Group Inc. and National Union Fire Insurance Co. of Pittsburgh, Pennsylvania.

The lawsuit also challenges United’s marketing rhetoric for insurance, saying it “wrongly threatens” customers by warning them that they will be responsible for the charges. Customers who bought the insurance policies did so under false pretenses, he said.

Arce seeks to represent a national class of clients who purchased their policies through Travel Guard from March 3, 2020. Thousands of clients could be included in the class, depending on the costume. A search of Travel Guard on United’s website is currently showing notifications regarding its travel exemption policy. United are also saying that they are permanently removing modification fees for most economy and premium cabin seats.

The lawsuit, however, says that when booking a flight, customers are required to check a box indicating that they understand they may be responsible for certain cancellation and delay fees if they do not choose to pay for Travel Guard insurance.

“Despite the existence of the refund policy, however, [United and the AIG units] attracted [Arce] and group members to purchase AIG travel insurance by making false statements at the time of booking that the coverage was necessary to avoid cancellation and / or modification charges, although this is not the case. case, ”Arce said in a 17-page complaint.

The lawsuit alleges fraud and misrepresentation of insurance coverage. United and the insurers broke the law by failing to disclose that coverage was unnecessary, he said.

With the lawsuit, AIG units become among the last insurers to face a class action lawsuit over travel insurance policies during a pandemic. Earlier this month, Nationwide dodged having to pay claims to customers after an Ohio federal judge found that stay-at-home orders and notices were not quarantines protected by their policies.

And the American unit of the Italian travel insurer Assicurazioni Generali Group fights 12 lawsuits accusing him of not having paid for the canceled trips. The cases were centralized in a multi-district litigation in New York in December.

A United spokesperson said the company was aware of the lawsuit, but declined to comment further.

Arce’s lawyer did not immediately respond to a request for comment.

An AIG spokesperson did not immediately respond to a request for comment.

Arce is represented by Yitzchak Kopel of Bursor & Fisher PA, and by Adrian Gucovschi of Gucovschi Law PLLC.

Information about the lawyers in the AIG and United units was not immediately available.

The case is William Arce et al. v. Travel Guard Group Inc. et al., Case Number 2: 21-cv-11741, in the United States District Court for the District of New Jersey.

– Additional reporting by Craig Clough. Edited by Haylee Pearl.

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