Court Approves Class Action Lawsuit Against Menora Mivtachim Over Claim Inflation

A district court in central Israel has approved a class action lawsuit against Menora Mivtachim, a major insurance company, concerning its auto insurance policies. The lawsuit, initially filed in 2021, alleges that Menora artificially inflated the reported value of insurance claims by including expenses paid to third parties for claim investigation and processing. This practice, according to the plaintiffs, was allegedly done to meet an annual reporting threshold of 35% of premiums, which in turn allows the company to increase future premiums.

The court certified the case on grounds including breach of statutory duty, negligence, and unjust enrichment. The lawsuit covers a broad group of policyholders whose claim reports between February 2014 and December 2021 allegedly included these third-party expenses. The plaintiffs argue that this inclusion distorted claim amounts, led to incorrect reporting thresholds, and negatively impacted the policyholders' claims history with insurers.

Plaintiffs are seeking financial restitution for the difference in premiums paid, NIS 1,000 in compensation for emotional distress for each group member, and a court order prohibiting Menora from including such third-party costs in future reports and mandating the removal of problematic past records. While approving the class action, the court dismissed the original applicant's personal claim and ordered a replacement representative plaintiff to be found within 60 days.

Menora Mivtachim, one of the leading players in the auto insurance sector, stated it is reviewing the decision. As of the end of 2025, the company was the fifth-largest in the industry by premiums, holding 8% market share in mandatory insurance and 8.4% in comprehensive and third-party property damage insurance. In the first half of 2026, its adjusted pre-tax profit in mandatory auto insurance was NIS 117 million, and NIS 142 million in property damage auto insurance.