More than 168,000 CarShield customers are receiving checks after the FTC settled deceptive advertising claims
- FTC is refunding over 168,000 CarShield customers nationwide.
- Drivers paid $120 monthly for coverage that often failed them.
- Settlement bans deceptive ads and tightens endorsement rules.
The last time we talked about CarShield was in mid-2024 when it settled with the Federal Trade Commission (FTC) over deceptive advertising charges. At that point, it had to pay $10 million for its actions. Now, most of that money is headed where it was always supposed to go: back to consumers. More than 168,000 people are receiving payments.
The settlement in July applied to CarShield and its contract administrator, American Auto Shield, LLC. Regulators accused the companies of misleading advertising and telemarketing that suggested customers would never have to worry about expensive repairs again.
Read: Warranty Company Accused Of Selling Promises While Drivers Paid Thousands And Got Denials
In practice, many found the coverage they were paying for, sometimes as much as $120 per month, fell apart the moment they actually needed it.
A Policy That Didn’t Hold
According to the FTC, CarShield’s ads claimed that all repairs, or at least all repairs to “covered” systems, would be paid for. Customers were also told they could use any repair shop and receive a rental car at no cost if their vehicle broke down.
In reality, claims were frequently denied, and exclusions buried in the fine print often left customers footing the bill themselves.
“For many consumers, a personal vehicle is one of their most valuable assets and a vital lifeline for getting to work, taking their kids to school, and obtaining medical care. Instead of delivering the ‘peace of mind’ promised by its advertisements, CarShield left many consumers with a financial headache,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection.
More Oversight for Future Ads
Under the settlement, CarShield and American Auto Shield are prohibited from making deceptive or misleading claims going forward. The order also requires that endorsements and testimonials used in advertising must be truthful, accurate, and not misleading.
The brand has long used celebrity endorsements in its ads, but the language will be under greater scrutiny now.
For customers affected by all of this, 168,179 in total, checks are already in the mail. Importantly, they must be cashed within 90 days. Interestingly, the FTC highlighted that it never requires people to pay money or provide account information to get their refund.
Perhaps they’re concerned about scammers related to this refund. In any case, Consumers who have questions about their payment should contact the refund administrator, Analytics, at 855-298-8877.