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Federal Court Approves $25 Million Class Action Settlement Regarding Allstate Auto Insurance Pricing

Date Published
May 29, 2024

May 22, 2024. Consumer-plaintiff Andrea Stevenson and Allstate Insurance Company reached a $25 million settlement in a class action lawsuit. The lawsuit, which has been in proceedings since August 2015, alleged that Allstate violated multiple California laws, including the Unfair Competition Law, Business & Professions Code, False Advertising Law, and Insurance Code, by improperly using price optimization to inflate consumers’ auto insurance premiums.

Settlement Details:

Allstate has agreed to a $25 million settlement to resolve the claims affecting over 1.2 million policyholders in California. While the company admits no wrongdoing or liability, this settlement brings closure to a complex case that has been pending in both the Federal Court and the California Department of Insurance and involved significant litigation and mediation efforts.


Plaintiff Andrea Stevenson, a loyal Allstate customer for over 25 years, filed the complaint alleging that Allstate’s alleged use of price optimization—considering a policyholder’s willingness to tolerate premium increases—was improper and not disclosed to the Department of Insurance. She alleged this practice led to higher premiums for policyholders presenting the same risk level as others who were charged lower rates.

Following extensive litigation over approximately 9 years, the parties reached an agreement.

Future Actions:

As part of the settlement, Allstate filed a new auto insurance class plan with the California Department of Insurance that does not use any form of price optimization or consider an individual’s or class’s willingness to pay a higher premium in calculating premiums. Allstate also agreed to cease using any form of price optimization to set private passenger auto rates for California policyholders in the future.

“We are pleased that the Court approved this significant Settlement, which benefits over a million California policyholders by way of monetary payments and important practice changes,” said Andrea R. Gold, one of the Tycko & Zavareei attorneys representing the class members.

The Plaintiff and Settlement Class members are represented by attorneys Andrea Gold of Tycko & Zavareei, Cyrus Mehri and Jay Angoff of Mehri & Skalet, and Jeffrey Osterwise of Berger Montague.

For further details on the settlement visit the settlement website:

Read more on Reuters

The case is Andrea Stevenson v. Allstate Insurance Co et al, No. 4:15-cv-04788-YGR in the U.S. District Court for the Northern District of California.

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