Facts

Travel Guard sells trip insurance plans called Travel Guard Plans. These plans include both the insurance premium and an "Assistance Fee" for one price. On December 17, 2021, Tamika Miller and Julianne Chuanroong filed a class action lawsuit in the USDC Northern against Travel Guard for violations of consumer protection laws including Unfair Competition, False Advertising, and common law fraud.

PLAINTIFFS' CONTENTIONS: Plaintiffs asserted that defendants violated state laws by deceptively requiring consumers to pay a fee for "non-insurance assistance services" on top of the authorized insurance premium. According to plaintiffs, these non-insurance assistance services--used for flight delays or cancellations, delayed or mishandled luggage, and medical emergencies--are combined for a higher price than the amount approved for the sale of travel insurance and such services were already covered by the insurance contracts. Accordingly, defendants' addition of the extra fees was illegal and unfair.

DEFENDANTS' CONTENTIONS: Defendants denied any wrongdoing, contending they complied with all applicable laws. Specifically, they presented several arguments, including in part: certain purchasers of the plans were subject to arbitration agreement; no law, statute or regulation expressly prohibited the bundling of insurance and non-insurance assistance services; defendants' rates and forms were approved by pertinent regulator; consumers were provided disclosures; and its practice comported with longstanding, industry-wide practice of bundling insurance and non-insurance services.

Settlement Discussions

The parties participated in mediation three times: the first on February 27, 2023 with Robert Meyer of JAMS; the second on July 28, 2023, with retired judge, Hon. Jay Gandhi, also of JAMS; and the third with Robert Meyer over the course of several days which resulted in an outline of material terms being reached on December 7, 2023.

Result

Without admitting liability, defendant agreed to pay $23,997,500 into a common settlement fund inclusive of all fees, costs, and awards.

Other Information

A similar complaint was filed in the Western District of Washington, *Allen v. Travel Guard Group Inc. et al., No. 3:22-cv-06005.