CarShield Lawsuit Settlement Alert, $9.6M Distributed to 168,179 Consumers in FTC Settlement — Did You Miss a Payment?
What Is the CarShield Lawsuit Settlement?
The FTC distributed $9.6 million to 168,179 consumers in December 2025 who purchased CarShield vehicle service contracts between September 2019 and September 2024 and had claims denied. CarShield and American Auto Shield agreed to a $10 million settlement in July 2024 after the Federal Trade Commission charged them with deceptive advertising about repair coverage, rental car benefits, and repair facility choice. The settlement resolved allegations that celebrity endorsers made false claims and consumers paid up to $120 monthly for contracts that denied coverage through numerous exclusions.
Latest December 2025 Settlement Distribution
Checks Mailed to Affected Consumers
In December 2025, the FTC sent checks to 168,179 affected consumers who qualify for refunds under the settlement. The $9.6 million distribution represents the consumer redress portion of the $10 million settlement reached in July 2024.
Check Cashing Deadline
Recipients must cash their checks within 90 days as indicated on each check. The 90-day window begins from the date checks were mailed in December 2025.
Who Received Checks Automatically
Consumers automatically received checks if they:
- Purchased a CarShield vehicle service contract between September 2019 and September 2024
- Had repair claims denied by CarShield or American Auto Shield
- Were identified in FTC records as eligible for refunds
No claim form was required. The FTC identified eligible consumers through CarShield’s records and automatically sent refunds.
Contact Information for Questions
Consumers with questions should contact the refund administrator, Analytics, at 855-298-8877. The FTC website also provides frequently asked questions about the refund process.
Average Check Amount
With $9.6 million distributed to 168,179 recipients, the average refund is approximately $57 per consumer. Individual amounts vary based on contract duration, monthly payments made, and claim denial circumstances.
The July 2024 FTC Settlement
Settlement Amount and Terms
NRRM, LLC (operating as CarShield) and American Auto Shield agreed to pay $10 million to settle Federal Trade Commission charges filed in July 2024. The settlement included:
- $9.6 million in consumer refunds (distributed December 2025)
- Permanent injunction against future deceptive practices
- Required compliance monitoring for up to 10 years
- Mandatory disclosure improvements in advertising
- Prohibition on misleading celebrity endorsements
What CarShield Was Charged With
The FTC complaint alleged CarShield’s advertisements and telemarketing were deceptive and misleading regarding vehicle service contracts. Specifically, the FTC charged:
False Coverage Claims: CarShield’s ads deceptively represented that all repairs or repairs to “covered” systems would be paid for under the plans. One television ad that ran 18,000 times stated CarShield ensures consumers don’t get stuck with expensive repair bills.
Rental Car Misrepresentations: The FTC alleged CarShield promised consumers would receive rental cars at no cost when vehicles broke down. In reality, consumers with denied claims received no rental car, while those with approved claims had to pay a portion of rental costs.
Repair Facility Choice Deception: CarShield ads claimed consumers could use the repair facility of their choice. However, many repair facilities did not accept CarShield’s vehicle service contracts, limiting consumer options.
Contract Costs: Consumers paid approximately $80 to $120 per month for vehicle service contracts. Telemarketers told consumers they would only face a $100 deductible for any covered repair.
Celebrity Endorsement Violations
The FTC alleged CarShield’s celebrity and consumer endorsers made false statements in advertisements. Celebrities including Ice-T, Chris Berman, and Dodgers pitcher Walker Buehler appeared in CarShield ads.
Ice-T’s False Claims: Ice-T stated in ads that CarShield gets expensive car repairs taken care of. The FTC determined Ice-T was not an actual CarShield customer when making these endorsements.
Walker Buehler’s Misleading Testimonial: Buehler claimed in ads that he called CarShield for protection from expensive car repairs. The FTC found Buehler had not actually used CarShield’s services.
Consumer Testimonial Fabrications: Consumer endorsers claimed to have saved specific amounts through CarShield. One consumer claimed to have saved close to $9,000 over seven years with three covered vehicles. The FTC determined consumers did not actually save the amounts they claimed in advertisements.
Samuel Levine’s Statement
“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. He added that CarShield used trusted personalities to deliver empty promises, exploiting consumers’ financial anxieties.
Separate Private Class Action Lawsuit Filed March 2025
New Litigation Beyond FTC Settlement
A separate class action lawsuit was filed in March 2025 in the U.S. District Court for the Eastern District of Missouri: April Lindsey-Evans, et al., v. NRRM, LLC d/b/a CarShield, LLC, American Auto Shield, LLC, et al. (Case No. 4:25-cv-00363).
This private lawsuit is distinct from the FTC enforcement action and remains actively litigated as of December 2025.
Lead Plaintiffs’ Experiences
April Lindsey-Evans (North Carolina): Lindsey-Evans purchased a CarShield contract for her 2010 Volkswagen Tiguan, paying $89.99 monthly from 2020 to 2024. When her vehicle wouldn’t start and was towed to a dealership, CarShield demanded an engine teardown that the dealer said was unnecessary. After two months of delays, she was forced to pay nearly $3,000 for repairs despite years of monthly payments.
Brenna Sebek and Kevin Sheehan (Illinois): The plaintiffs pay $169.99 monthly for CarShield coverage on a 2016 Volkswagen Jetta and were forced to pay $3,500 for repairs and $1,500 for alternative transportation. When they requested information about the contractual basis for denial, CarShield provided inconsistent answers, including claiming nothing was wrong with the vehicle despite the mechanic’s diagnosis and repair quote.
Allegations in Private Lawsuit
The class action alleges CarShield and American Auto Shield:
- Make misleading claims about vehicle service contracts that don’t match real-world results
- Don’t back up their vehicle service contracts
- Take several weeks or months to make decisions about repair claims
- Violate vehicle service contract terms, forcing repair expenses onto vehicle owners
- Use false and deceptive advertising that leaves consumers paying thousands for uncovered repairs
Class Definition
The lawsuit seeks to represent all consumers nationwide who purchased CarShield vehicle service contracts and experienced claim denials, delayed decisions, or forced out-of-pocket repair expenses.
Current Status of Private Lawsuit
The case remains in early litigation stages as of December 2025. No settlement has been reached in this separate action. The private lawsuit proceeds independently from the FTC settlement and could result in additional compensation for affected consumers.
What the FTC Found About CarShield’s Practices
Scripted Telemarketing Deception
CarShield used telemarketers who followed scripted statements written by CarShield and cleared by American Auto Shield. These scripts told consumers they would face only a $100 deductible for any covered repair, whether using a dealer or local mechanic.
Reality Versus Marketing Promises
The FTC found a stark disconnect between CarShield’s marketing and actual contract performance:
Coverage Exclusions: None of CarShield’s vehicle service contracts cover all repairs or even all repairs to “covered” vehicle systems like engines and transmission. Contracts contain myriad exclusions that frequently deny consumer claims.
Repair Facility Limitations: Many consumers could not use their preferred repair facility because shops refused to accept CarShield’s vehicle service contracts. This directly contradicted advertising promises about facility choice.
Rental Car Restrictions: Consumers with denied claims received no rental car whatsoever. Even consumers with approved claims had to pay portions of rental car costs, despite ads promising rental cars at no additional cost.
Revenue and Commissions
Between September 2019 and November 2022, CarShield earned commissions of about $600 million selling vehicle service contracts on behalf of American Auto Shield.
Applicable Legal Framework
Section 5 of the FTC Act
The FTC brought charges under Section 5 of the Federal Trade Commission Act, which prohibits unfair or deceptive acts or practices in commerce. The statute grants the FTC authority to investigate and prosecute companies engaging in consumer deception.
FTC’s Combating Auto Retail Scams (CARS) Rule
The FTC’s CARS Rule prohibits the sale of any add-on product or service that confers no benefit to the consumer. The rule also prohibits misrepresentations concerning costs, limitations, benefits, or any material aspect of add-on products.
While the CARS Rule faces legal challenges and is currently stayed, the FTC made clear that failures to meet CARS Rule standards constitute unfair or deceptive practices under Section 5 regardless of the rule’s enforcement status.
FTC’s Endorsement and Testimonial Guides
The FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising require that endorsements reflect the honest opinions, findings, beliefs, or experiences of the endorser. When celebrity endorsers claim to use a product, they must actually use that product.
CarShield violated these guides by featuring celebrities who were not actual customers and consumer testimonials that inflated savings amounts.
Telemarketing Sales Rule
The settlement order requires CarShield to follow the FTC’s Telemarketing Sales Rule, which establishes specific disclosure requirements and prohibits deceptive telemarketing practices.
State Consumer Protection Laws
The private class action lawsuit likely invokes state consumer protection statutes in Missouri, North Carolina, Illinois, and other states where class members purchased contracts. These laws typically mirror federal prohibitions on deceptive trade practices.
Settlement Requirements and Ongoing Obligations
Permanent Injunction Terms
The stipulated order entering final judgment includes permanent injunctions prohibiting CarShield and American Auto Shield from:
Making False Coverage Representations: The companies cannot misrepresent the coverage, benefits, limitations, or terms of vehicle service contracts.
Deceptive Endorsement Practices: CarShield must ensure all endorser testimonials are truthful, accurate, and not deceptive. Celebrity endorsers must actually use the products they promote.
Required Disclosures: The order mandates clear disclosures about contract limitations, exclusions, repair facility restrictions, and rental car policies in all advertising and telemarketing.
Compliance Monitoring
CarShield agreed to be monitored for compliance for up to 10 years. This extended monitoring period allows the FTC to verify ongoing adherence to settlement terms.
CarShield’s Response to Settlement
In a statement on its website, CarShield said it disagreed with many FTC assertions but shares the agency’s commitment to helping customers understand exactly what the company provides. CarShield noted its marketing now includes additional details about covered repair elements and directs potential customers to its website where full plans are viewable before purchase.
Business Practice Changes Implemented
CarShield announced several changes following the settlement:
Expanded Repair Network: The company added more than 10,000 preferred car repair shops to its Shield Repair Network.
Concierge System: CarShield created a concierge system to help customers quickly locate convenient repair facilities.
Rental Car Improvements: The company expanded rental car coverage, provided rideshare benefits, and improved the rental car process for earlier coverage.
Endorser Verification: CarShield stated it now ensures all spokespeople in ads are actual CarShield customers.
Evidence Presented in FTC Complaint
Television Advertising Analysis
One CarShield ad ran 18,000 times on television stating CarShield’s administrators ensure consumers don’t get stuck with expensive car repair bills. The ad described CarShield vehicle service contracts as “your best line of defense against expensive breakdowns.”
Celebrity Endorsement Documentation
The FTC complaint documented specific false claims made by celebrity endorsers:
- Ice-T’s statements about CarShield taking care of expensive repairs
- Chris Berman’s endorsements assuring consumers of coverage
- Walker Buehler’s claims about calling CarShield for protection
The FTC obtained evidence proving these celebrities had not actually used CarShield’s services when making endorsements.
Consumer Testimonial Records
The complaint included evidence of consumer endorsers claiming specific savings amounts that CarShield could not verify. One consumer’s claim of $9,000 in savings over seven years was documented as false or inflated.
Contract Exclusion Analysis
The FTC examined actual CarShield vehicle service contracts and identified myriad exclusions that contradicted advertising claims. The agency documented that no CarShield contract covers all repairs or even all repairs to systems advertised as “covered.”
Consumer Complaint Data
The Better Business Bureau’s online report shows 3,298 complaints closed in the last 3 years. Based on 2,777 customer reviews, CarShield has a rating of 1.79 out of 5 stars. Complaints continue about repairs not covered and service work not paid for.
Regional Complaint Volume
A 2021 St. Louis BBB report noted the vehicle service contract industry has long been a source of consumer dissatisfaction. The bureau processed more than 15,000 complaints against 80 different vehicle service contract companies in its region between 2018 and 2020.
How This Compares to Similar Consumer Protection Cases
Extended Warranty Industry Scrutiny
The CarShield settlement represents the FTC’s ongoing focus on extended warranty and service contract deception. Similar cases have targeted companies making false promises about repair coverage.
Celebrity Endorsement Enforcement
The case demonstrates the FTC’s aggressive enforcement against false celebrity endorsements. Advertisers cannot feature celebrities claiming to use products they have never actually used, regardless of how trusted those personalities are.
Add-On Product Deception
The settlement aligns with the FTC’s broader initiative against deceptive add-on products in the automotive industry. The agency views products that provide no actual benefit as inherently deceptive.
Telemarketing Fraud Patterns
CarShield’s use of scripted telemarketing statements mirrors patterns the FTC has prosecuted in other industries. Written scripts that make false promises violate the Telemarketing Sales Rule.
Multi-Million Dollar Consumer Redress
The $9.6 million refund distribution places CarShield among significant FTC consumer redress cases. In 2024, FTC actions led to more than $339 million in refunds to consumers across the country.
What This Means for Affected Consumers
If You Received a Check in December 2025
Cash your check within 90 days as indicated. The FTC never requires people to pay money or provide account information to receive refunds. Be alert for scammers claiming to help you get refunds—the FTC sends checks automatically to eligible consumers.
If You Believe You Qualify But Didn’t Receive a Check
Contact the refund administrator Analytics at 855-298-8877 to verify your eligibility. Provide documentation of your CarShield contract purchase between September 2019 and September 2024 and evidence of denied claims.
If You Purchased a Contract After September 2024
You are not covered by the FTC settlement distribution. However, you may have claims under the separate private class action lawsuit filed in March 2025 if you experienced claim denials or misleading practices.
Current CarShield Contract Holders
The settlement requires CarShield to implement improved practices, including clearer disclosures and truthful endorsements. Review your current contract carefully for exclusions. If you experience claim denials, document all communications and consider contacting the refund administrator or consumer protection attorneys.
Potential Participation in Private Class Action
If you purchased a CarShield contract and experienced issues beyond those covered by the FTC settlement, you may qualify for the separate class action lawsuit filed in March 2025. The lawsuit seeks to represent consumers nationwide who faced claim denials, delays, or forced out-of-pocket repair expenses.
Broader Implications for Consumer Protection
Accountability for Deceptive Marketing
The CarShield settlement sends a clear message that the FTC will pursue companies using false advertising to exploit consumers’ financial anxieties about vehicle repairs. The 10-year monitoring period ensures ongoing compliance.
Celebrity Endorser Liability
The case establishes that advertisers face significant penalties when celebrity endorsers make false claims. Companies must verify that endorsers actually use the products they promote and that testimonials reflect genuine experiences.
Extended Warranty Industry Reform
The settlement may prompt broader reforms in the vehicle service contract industry. Companies must clearly disclose coverage limitations, exclusions, repair facility restrictions, and rental car policies in all advertising and sales materials.
Telemarketing Script Compliance
The case highlights FTC scrutiny of scripted telemarketing statements. Companies writing sales scripts face liability when those scripts make false promises to consumers.
State-Federal Enforcement Coordination
While the FTC led this enforcement action, the case demonstrates coordination with state consumer protection agencies. Private class actions filed in state courts provide additional remedies for affected consumers.
Consumer Awareness and Due Diligence
The settlement emphasizes consumers’ need to carefully review service contract terms before purchase. Extended warranties and vehicle service contracts often contain extensive exclusions that limit actual coverage despite broad marketing claims.
Frequently Asked Questions
Q: How much money will I receive from the CarShield settlement?
The FTC distributed $9.6 million to 168,179 consumers, averaging approximately $57 per recipient. Individual amounts vary based on your contract duration, monthly payments, and specific claim denial circumstances. If you received a check in December 2025, the exact amount is printed on the check.
Q: I had a CarShield contract between 2019-2024 and had claims denied. Why didn’t I receive a check?
The FTC identified eligible consumers through CarShield’s records. If you believe you qualify but didn’t receive a check, contact the refund administrator Analytics at 855-298-8877 with documentation of your contract purchase and denied claims. Verify your mailing address was current in CarShield’s records.
Q: Can I still join a lawsuit against CarShield?
The FTC settlement is closed and no additional claims can be filed under that action. However, a separate private class action lawsuit was filed in March 2025 in the U.S. District Court for the Eastern District of Missouri. If you purchased a CarShield contract and experienced claim denials, delays, or forced out-of-pocket expenses, you may qualify for this separate litigation. Contact consumer protection attorneys for evaluation.
Q: What if I currently have a CarShield contract?
Review your contract carefully for exclusions and limitations. The settlement requires CarShield to implement improved disclosure practices and truthful endorsements. If you experience claim denials, document all communications including denial reasons, requested teardowns, and timeline delays. Consider whether the monthly cost justifies the actual coverage provided.
Q: Were the celebrities who advertised CarShield held accountable?
The FTC settlement focuses on CarShield and American Auto Shield as the companies responsible for advertising claims. The order prohibits future use of false endorsements. Celebrities including Ice-T, Chris Berman, and Walker Buehler were identified as making false claims, but individual celebrity liability was not pursued in this action.
Q: How long do I have to cash my settlement check?
You must cash your check within 90 days as indicated on the check. The 90-day period begins from when checks were mailed in December 2025. Do not delay—checks expire after the deadline.
Q: Is the $10 million settlement the total amount CarShield paid?
Yes. The $10 million settlement consisted of $9.6 million in consumer refunds (distributed December 2025) plus approximately $400,000 in administrative costs and FTC enforcement expenses. CarShield also faces ongoing compliance monitoring costs for up to 10 years.
Q: Should I purchase a vehicle service contract from CarShield now?
The settlement requires CarShield to implement improved practices including clearer disclosures, truthful endorsements, expanded repair networks, and better rental car processes. However, independent consumer advocates generally recommend building a dedicated savings account for unexpected repairs rather than purchasing extended warranties or vehicle service contracts, which often contain extensive exclusions limiting actual coverage.
Disclaimer: This information is for educational purposes only and does not constitute legal advice. CarShield settlement eligibility, refund amounts, and claim procedures depend on individual circumstances and applicable law. Consumers with specific questions should contact the refund administrator or qualified consumer protection attorneys.
Sources: Information compiled from Federal Trade Commission official announcements, court filings, settlement orders, FTC complaint documents, and credible legal reporting from established sources including the FTC website, CarComplaints.com, Consumer Finance Monitor, and official settlement administrator communications.
About the Author
Sarah Klein, JD, is a licensed attorney and legal content strategist with over 12 years of experience across civil, criminal, family, and regulatory law. At All About Lawyer, she covers a wide range of legal topics — from high-profile lawsuits and courtroom stories to state traffic laws and everyday legal questions — all with a focus on accuracy, clarity, and public understanding.
Her writing blends real legal insight with plain-English explanations, helping readers stay informed and legally aware.
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