Wednesday, 20 February 2019 15:07

Class Action Against Allstate Can Continue; Company, Not State, Sets Rates, Appeals Court Says

Written by Dan Churney, Cook County Record



Under the primary jurisdiction doctrine, a judge can halt court proceedings and let an administrative agency, which has the appropriate expertise, decide the issue in dispute.


In the Allstate matter, the company said the director of the Department of Insurance is empowered to determine if an insurer is engaging in unfair or deceptive conduct.


However, Cates concluded, the suit doesn’t allege wrongdoing unique to the insurance industry, saying the Department of Insurance doesn’t have any specialized knowledge or technical expertise with regard to Allstate’s alleged conduct.


“The allegations of unfair and deceptive business practices and unjust enrichment come within the experience and conventional competence of the Illinois courts,” Cates said.


Justice Moore disagreed, finding the Department of Insurance does have authority to weigh whether a rate is improper.


“While, under Illinois law, the director and Department of Insurance do not have the power to set insurance rates or pre-approve filed rates, there is a comprehensive statutory scheme whereby the legislature has given the Department of Insurance the power to disapprove rates based on unfair or deceptive acts or practices by those engaged in the business of insurance,” Moore said.


Plaintiffs have been represented by the following firms: Mehri & Skalet, and Tycko & Zavareei, both of Washington, D.C.; Law Offices of Thomas E. Kennedy, III, of St. Louis; and Berger & Montague, of Philadelphia.


Allstate has been defended by the firms of HeplerBroom firm, of Edwardsville, and DLA Piper, of Baltimore.


We thank Cook County Record for reprint permission.

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