A $24 million agreement to settle a class action against certain American International Group (AIG) firms has been granted preliminary approval.
The initial go-ahead was provided by a California federal court, Law360 reported. The lawsuit that’s being settled relates to alleged hidden fees in travel insurance policies. The settlement sum was arrived at last December following “lengthy negotiations” involving mediators.
Citing the motion for approval, rating agency AM Best noted earlier this year that $23,997,500 is planned to be paid into a common fund to compensate settlement-notice class members from California as well as those who purchased coverage through third-party online travel sites.
“The settlement would pay for damages and attorneys’ fees over allegations that policies from Travel Guard Group, the marketing name for travel insurance plans offered by AIG Travel and National Union Fire Insurance Company of Pittsburgh, Pa., included undisclosed travel assistance services fees,” AM Best reported at the time.
It was also previously noted that, in addition to paying the abovementioned amount, the relevant firms would have to inform all future Travel Guard Plans policyholders that the price for a plan includes an additional fee for non-insurance travel assistance services.
The class action was accusing the AIG companies of fraud and violations of unfair competition and false advertising laws in California.
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