July 8, 2010
Texas Attorney General Greg Abbott today sent a demand letter instructing Travelers Insurance to cease and desist airing what Abbott calls a deceptive television advertisement.
According to the attorney generals letter, the ad improperly indicates that Texas homeowners should purchase additional motor vehicle insurance or risk losing their homes if they have inadequate insurance after a vehicle accident.
The attorney general demands that the advertisement be removed from all Texas television media markets as well as any print, multimedia, radio or computer-generated ads that appear in the state.
A Travelers ad airing across Texas entitled Driving Your House depicts a man driving his home through a desert environment when suddenly he has an accident and the home and contents are severely damaged. The narrator strongly suggests that without additional vehicle insurance, a drivers home could be at risk from uncovered liability after a car crash.
A particularly misleading portion of the ad says: "Without the right auto insurance, a crash might impact more than your car. Make sure you're properly covered, so when you're driving your car, you're not risking your house. Travelers, take the scary out of life."
The Travelers ad is similar in message to a 2005 Allstate Insurance commercial. In that instance, the Attorney General sent a strongly worded cease-and-desist letter as well, resulting in Allstate pulling down the ad.
Travelers could be liable for civil penalties under the Texas Deceptive Trade Practices Act of up to $20,000 based on each airing of this ad. The attorney general may also inquire of homeowners who purchased additional and unnecessary insurance because they were influenced by the ad.
Abbott's statements apply only to Texas. Not all states have strong homestead exemption laws.
