San Antonio insurer USAA this week agreed to pay up to $39 million to settle a Florida class-action lawsuit that alleged it breached the terms of auto insurance policies by failing to fully pay members for sales tax in the purchase of a comparable vehicle after theirs was totaled in an accident.USAA and the policyholders who sued in 2013 on Tuesday asked the federal court in Jacksonville to approve the proposed settlement.

Under the settlement terms, as many as 75,000 USAA members may be eligible to receive full reimbursement for their claims, along with 8 percent in prejudgment interest. The plaintiffs claims total about $34 million, a court filing shows.

USAA agreed to settle the suit because litigation is expensive, unpredictable and disruptive to its operations, spokesman Roger Wildermuth said.

“We believe that we properly followed the Florida statute and paid members’ sales tax when they notified USAA they had replaced their vehicles,” he said.

Tracy Markham, a St. Augustine, Florida, lawyer for the plaintiffs, didn’t immediately respond to a request for comment. The plaintiffs’ lawyers stand to receive up to $5.1 million in fees and costs.

The settlement was first reported by Law360.

According to a court filing, USAA would pay members the sales tax paid in the purchase of a comparable vehicle when the tax was incurred. So, for example, someone who did not purchase a replacement vehicle would not be reimbursed for the sales tax.

The court filing further states that USAA has changed its policy in Florida and now includes the sales tax in payments for “total-loss vehicles.” USAA has agreed to maintain that practice unless it implements a change in its insurance policies specifying that sales tax will be paid as incurred.

The class covers any USAA members who suffered a total loss to their vehicle from Oct. 17, 2008, to Oct. 15, 2016.

In Texas, Wildermuth said USAA pays sales tax for total losses up front.

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