State Farm Settles
5/14
Judge Denies Motion For New State Farm Trial POSTED: 5:07 pm CDT May 13, 2007
UPDATED: 5:09 pm CDT May 13, 2007
JACKSON, Miss. -- A federal judge on Friday denied State Farm Fire and Casualty Co.'s request for a new trial in a Hurricane Katrina case that could cost the company more than $1.2 million.
Judge L.T. Senter Jr. said he saw no reason to grant a new trial to State Farm, which lost a January jury trial in a lawsuit brought by Biloxi residents Norman and Genevieve Broussard.
Senter presided over that trial. He took part of the case out of jurors' hands and ruled that State Farm is liable for $223,292 in damage to the Broussards' home.
Senter said State Farm failed to prove that Katrina's storm surge was responsible for all the damage to the Broussards' home.
Jurors in that case awarded $2.5 million in punitive damages against State Farm, but Senter later reduced the award to $1.2 million.
A State Farm spokesman said the company is not surprised by the ruling.
The company plans to appeal the ruling to the 5th U.S. Circuit Court of Appeals.
3/12 Lawyers Withdraw Request For Judge To Approve State Farm Settlement
http://www.wlox.com/Global/story.asp?S=6216607
On Monday, however, Scruggs' legal team said in court papers that they are withdrawing their request for Senter to sign off on the deal, citing a legal "stalemate."
3/1 Senter weighs options Settlement must protect class' rights
http://www.sunherald.com/mld/sunherald/16807135.htm
U.S. District Court Judge L.T. Senter Jr. told a packed courtroom Wednesday he will approve a class-action settlement of State Farm Fire and Casualty Co.'s Hurricane Katrina claims only if he is assured policyholders receive "substantial benefits" the current proposal lacks.
2/15 State Farm retreats in Gulf (Allstate is in MD too - per Gary)
Updated 2/14/2007 11:01 PM ET
By Kathy Chu, USA TODAY
State Farm's decision Wednesday to stop writing new home and commercial policies throughout Mississippi could prompt other insurers to retreat further from the Katrina-battered region, industry groups and legal experts say.
State Farm — which insures about one of every three Mississippi homes — is the first company since Hurricane Katrina to stop offering new policies throughout a state in the Gulf Coast area. Its move underscores the precarious nature of the region's insurance. Since the hurricane, insurers have cut back on homeowner policies in affected coastal areas.
The decision Wednesday is one State Farm came to "reluctantly," says company spokesman Phil Supple, partly because of the torrent of lawsuits and rulings in Mississippi since Katrina and the uncertainty of pending legal battles. The move doesn't affect existing policyholders, at least for now. State Farm is the largest insurer of homes in the USA, as well as in Mississippi. Last year, the company wrote about 29,000 new homeowners policies in the state.
The insurer's "extraordinary step" could affect companies facing similar legal issues, says Robert Hartwig of the Insurance Information Institute. "I can't rule out that other insurers might make similar legal decisions."
Mike Siemienas, a spokesman for Allstate, another large insurer, says his company "can't speculate on what we'll do," but when it makes coverage decisions, "we review the entire situation" in the state.
Insurers are still grappling with thousands of homeowners' lawsuits related to Katrina damage. At issue is whether homes reduced to slab were damaged by wind or water. Homeowners policies cover wind damage, but only federal flood policies cover flooding.
In Mississippi, State Farm has agreed to settle 640 individual lawsuits and to pay at least $50 million to reopen up to 35,000 hurricane-related homeowners' claims. A federal judge, though, has suspended part of the settlement in question, seeking more information. A hearing on the settlement is set for late February.
Matthew Steffey, a professor at Mississippi College School of Law, believes the timing of State Farm's announcement — weeks before the federal court hearing — isn't coincidental. "I think the message is if we can't settle these cases favorably, then we will quit doing (new) business in your state, and the fear is that other insurers" will pull out, he says.
Supple, of State Farm, notes, "There is no good timing for this announcement."
The bad news for homeowners, says Birny Birnbaum of the Center for Economic Justice, a consumer-advocacy group, is that "other insurers are probably going to follow suit (in pulling back on homeowners' coverage in the region) because they want to apply political pressure" like State Farm
2/12 "We Didn't Plan for That" Jackson, Miss. Reporter: Wendy Suares
State Farm Insurance got nailed for failing to pay claims from Hurricane Katrina. Checks have been sent to more than 600 Mississippi policy holders who sued the insurer, as part of an $80 billion settlement. And a separate $50 million settlement for thousands more policy holders is under a judge's review. Insurers are reeling from the storm and it could mean changes for homeowners statewide.
"We didn't plan for that. Policy holders didn't plan for that, and governments by and large didn't plan for that," said Mike Fernandez, public affairs vice-president for State Farm.State Farm is facing hundreds of hurricane damage lawsuits on the Mississippi coast. Fernandez says the outcome will shape the company's future here. Other companies have pulled out of certain areas completely.
"We've seen a lot of other players literally pull out of markets, cut back, and we shaved off a little, not too severely in Alabama, but you have to look at the particular market risk you're dealing with," Fernandez said.
And that risk has pushed up premiums for many Mississippi policy holders. State lawmakers are tackling the issue, passing legislation to shore up the state wind pool and allow companies to recoup some of their losses. Fernandez says that action is helping secure the market.
"We feel good about that movement even while we're uneasy about some of the movement in the courts," he said.
Companies like State Farm say they're uneasy, yet they're posting record profits. Industry officials expect profits this year to reach $60 billion.
"If you look at it over a period of time, there were three years when we had losses and at some point, you have to build up those reserves so you can meet that next natural disaster," said Fernandez.
A federal judge has scheduled a hearing later this month to clarify terms in the proposed $50 million State Farm settlement that would resolve disputed claims of thousands of policy holders who didn't sue.
http://www.wtok.com/news/headlines/5731836.html
2/9 State Farm policyholders will have a chance to weigh in
on two proposed class-action cases aimed at resolving Hurricane Katrina claims en masse.
U.S. District Judge L.T. Senter Jr. on Thursday ordered two hearings for Feb. 28 to consider the proposals. Property owners or their representatives can fill out forms attached to the orders to participate if their insured property was a total loss or suffered more than 90 percent damage. The forms are attached to Senter's orders posted at sunherald.com or on the federal court Web site, http://www.mssd.uscourts.gov/.
State Farm Fire & Casualty Co. is requesting a class-action settlement negotiated with the Scruggs Katrina Group of attorneys on behalf of up to 35,000 Coast policyholders. At the 1:30 p.m. hearing, Senter expects attorneys to address 10 areas of concern he has about the settlement.
A letter Senter sent to 108 attorneys Feb. 2 said, "While the proposed class action is currently limited to State Farm policyholders, any procedure the court approves as an alternative to litigation would likely serve as a de facto model that would apply to similar claims against the other major insurers, Allstate and Nationwide."
The second proposal would certify the case of Ocean Springs homeowner Judy Guice as a class-action lawsuit representing hundreds of State Farm policyholders whose homes Katrina swept away. Senter had rejected class-action certification for the Guice case, but said he will reconsider at a 10 a.m. hearing, also on Feb. 28.
Guice's attorneys are asking Senter to extend his ruling in a previous case, Broussard v. State Farm, to other policyholders with slabs. In Broussard, Senter ruled State Farm must prove the excluded peril of water caused a loss in order to deny coverage. The policyholders' only burden, he said, is to show they suffered an accidental, direct physical loss.
That is what Guice has argued all along and is the guideline the proposed Guice class-action case would follow. Her attorneys seek full coverage for those whose claims, like the Broussards, State Farm denied without proving the policy's water exclusion applied. Policyholders also would have the right to pursue punitive damages, designed to deter bad behavior, from State Farm.
The Broussards have been awarded $1 million in punitive damages, but it could be years before they collect and only if Senter's ruling is upheld through appeals.
State Farm opposes class-action certification for Guice's case. Company spokesmen say each policyholder claim is different and needs to be evaluated on its own merits. The company maintains it owes nothing under policies when wind and water damage are inseparable.
Under the class-action settlement with the Scruggs group, State Farm is willing to offer payments as a compromise. The company has agreed on slab claims to pay at least 50 percent of policy limits for structure and contents, less any wind or flood payments already received. Those with less damage would receive lower payments.
Policyholders who accept settlement checks would forfeit any right to file lawsuits or seek punitive damages.
State Farm has said the Broussard ruling probably will be appealed. Meanwhile, the company continues to follow its policy regarding separate wind and water damage, according to a claims manager forced to give sworn pre-trial testimony in the Guice case.
The State Farm claims manager, Dannye Smith, said the company's top claims executive, Susan Q. Hood, visited the Coast after the Broussard verdict and told employees the company was proud of them. Smith also said he was unaware of any procedure the company has adopted to review claims files that were not adjusted according to Senter's ruling in Broussard.
http://www.sunherald.com/mld/sunherald/16658692.htm
1/31 Judge Rejects Part Of State Farm Settlement
http://208.62.60.4/40/article_895.shtml
State Farm Katrina suits back in court
By BENNIE SHALLBETTER Jan 31, 2007, 09:20
Federal Judge L.T. Senter Jr. denied a motion "without prejudice" for a class action settlement proposed by State Farm, Attorney General Jim Hood, and a host of attorneys. The declaration allows lawyers to go back to the table with State Farm to negotiate a new settlement that satisfies the judges concerns.Local attorney Zach Butterworth, who filed the first claim against State Farm in Hancock County, says he and others have confidence that the kinks will be worked out in the settlement involving some 35,000 policy holders who did not file a suit against State Farm. Conference calls, meetings, and negotiations between the parties continued all weekend and were still continuing at press time."It's all very complicated," Butterworth said Tuesday. "But I just can't believe that State Farm would let it all blow up again after all the work."Though the terms of an agreement are complicated, each case seeking settlement being totally different, Butterworth said, the bottom line of the negotiations is simple: State Farm wants to keep money and negotiators want to get it.Policyholders involved in the Scruggs suit, more than 100 in Hancock County, should begin receiving their checks as early as Monday, Butterworth said. After months of negotiations seeing people able to go on with their lives is all the reward he wants, he said.Some of Senter's objections to the settlement include no guaranteed minimum for some categories of damage, no information to determine the extent of class claims or coverage or number of class members, State Farm and others would be released from the threat of punitive damages. Should negotiations break down at this point for other policy holders, it could mean years of litigation for those who choose to pursue claims. And apparently "good neighbor" State Farm has both the time and the money to spend years in the legal process. After eight years of litigation 70 homeowners in Oklahoma, whose homes were destroyed by tornadoes in 1999, have yet to see a penny from the company, Butterworth said.But State Farm is not the only bad neighbor in the insurance business, he said. A 1996 investigation found that Prudential defrauded more than 10 million life insurance customers in claims totaling more than $2 billion, said the American Association for Justice website.According to the Los Angeles Times insurance companies made a record $44.8 billion in 2005 and increased industry surplus by more than $427 billion, even after accounting for the claims of policyholders wiped out by Katrina.
© 2005 Bay St. Louis Newspapers, Inc.
State Farm reaches $500 million settlement
By ANITA LEE
calee@sunherald.com
An historic agreement with State Farm Fire & Casualty Co. means up to $500 million in payments to policyholders previously dissatisfied with their Hurricane Katrina insurance settlements.
Attorney General Jim Hood said Wednesday afternoon that State Farm will pay 50 percent of policy limits to certain homeowners left with only slabs. State Farm previously had denied those claims, maintaining water led to the destruction and the company was unable to find any separate wind damage covered under its policies.
The two sides signed a settlement agreement filed today in Hinds County Chancery Court, which also brings an end to the lawsuit Hood filed shortly after Katrina to seek coverage for policyholders whose homes were subject to tidal surge.
"It's not the best thing since sliced bread," Hood said. "I wanted to get everybody 100 percent. This is a settlement option primarily for the 8,000 people hit by storm surge who don't have lawyers."
Hood said State Farm has about 800 slab claims on the Coast and about 9,000 policyholders whose homes were hit by storm surge. The company, by its own count, had a total of more than 32,000 Coast Katrina claims filed as of February 2006.
He later summed up what he sees as the benefits of the settlement. "This is just an option. It will get some money on the ground quick. It will stabilize the insurance market and it will help in our economic development. We've got to rebuild our homes and the people's lives."
State Farm released a statement that read, in part, "We believe this is in the best interests of our policyholders and State Farm, and the effort to rebuild Mississippi.
"Basically, we'll work with out policyholders to review claims in the three counties - Harrison, Hancock and Jackson."
Under the settlement, State Farm has agreed to review the claims of any Coast policyholder who opts in. The settlement also gives policyholders the right to see their State Farm file. If a policyholder is dissatisfied with State Farm's offer, they can go to binding court arbitration with the company.
Policyholders who are suing the company, or who reached an agreed settlement with State Farm in mediation, are not eligible to participate. The Scruggs Katrina Group, representing 640 policyholders, also has reached a settlement of its cases with State Farm, but those terms are undisclosed.
Hood said he hopes to reach agreements with other insurance companies. As part of the agreement, he will drop a civil lawsuit that he filed shortly after the storm to seek coverage for policyholders and put on hold a criminal investigation into State Farm's claims practices.
Hood said, however, that he has been assured Congress will pursue an investigation of how the industry reacted to Katrina.
Read more on the settlement as developments happen at sunherald.com and in Wednesday's Sun Herald.
For More Information
http://katrinanetworking.blogspot.com/2006/09/state-farm-investigation.html
Judge Denies Motion For New State Farm Trial POSTED: 5:07 pm CDT May 13, 2007
UPDATED: 5:09 pm CDT May 13, 2007
JACKSON, Miss. -- A federal judge on Friday denied State Farm Fire and Casualty Co.'s request for a new trial in a Hurricane Katrina case that could cost the company more than $1.2 million.
Judge L.T. Senter Jr. said he saw no reason to grant a new trial to State Farm, which lost a January jury trial in a lawsuit brought by Biloxi residents Norman and Genevieve Broussard.
Senter presided over that trial. He took part of the case out of jurors' hands and ruled that State Farm is liable for $223,292 in damage to the Broussards' home.
Senter said State Farm failed to prove that Katrina's storm surge was responsible for all the damage to the Broussards' home.
Jurors in that case awarded $2.5 million in punitive damages against State Farm, but Senter later reduced the award to $1.2 million.
A State Farm spokesman said the company is not surprised by the ruling.
The company plans to appeal the ruling to the 5th U.S. Circuit Court of Appeals.
3/12 Lawyers Withdraw Request For Judge To Approve State Farm Settlement
http://www.wlox.com/Global/story.asp?S=6216607
On Monday, however, Scruggs' legal team said in court papers that they are withdrawing their request for Senter to sign off on the deal, citing a legal "stalemate."
3/1 Senter weighs options Settlement must protect class' rights
http://www.sunherald.com/mld/sunherald/16807135.htm
U.S. District Court Judge L.T. Senter Jr. told a packed courtroom Wednesday he will approve a class-action settlement of State Farm Fire and Casualty Co.'s Hurricane Katrina claims only if he is assured policyholders receive "substantial benefits" the current proposal lacks.
2/15 State Farm retreats in Gulf (Allstate is in MD too - per Gary)
Updated 2/14/2007 11:01 PM ET
By Kathy Chu, USA TODAY
State Farm's decision Wednesday to stop writing new home and commercial policies throughout Mississippi could prompt other insurers to retreat further from the Katrina-battered region, industry groups and legal experts say.
State Farm — which insures about one of every three Mississippi homes — is the first company since Hurricane Katrina to stop offering new policies throughout a state in the Gulf Coast area. Its move underscores the precarious nature of the region's insurance. Since the hurricane, insurers have cut back on homeowner policies in affected coastal areas.
The decision Wednesday is one State Farm came to "reluctantly," says company spokesman Phil Supple, partly because of the torrent of lawsuits and rulings in Mississippi since Katrina and the uncertainty of pending legal battles. The move doesn't affect existing policyholders, at least for now. State Farm is the largest insurer of homes in the USA, as well as in Mississippi. Last year, the company wrote about 29,000 new homeowners policies in the state.
The insurer's "extraordinary step" could affect companies facing similar legal issues, says Robert Hartwig of the Insurance Information Institute. "I can't rule out that other insurers might make similar legal decisions."
Mike Siemienas, a spokesman for Allstate, another large insurer, says his company "can't speculate on what we'll do," but when it makes coverage decisions, "we review the entire situation" in the state.
Insurers are still grappling with thousands of homeowners' lawsuits related to Katrina damage. At issue is whether homes reduced to slab were damaged by wind or water. Homeowners policies cover wind damage, but only federal flood policies cover flooding.
In Mississippi, State Farm has agreed to settle 640 individual lawsuits and to pay at least $50 million to reopen up to 35,000 hurricane-related homeowners' claims. A federal judge, though, has suspended part of the settlement in question, seeking more information. A hearing on the settlement is set for late February.
Matthew Steffey, a professor at Mississippi College School of Law, believes the timing of State Farm's announcement — weeks before the federal court hearing — isn't coincidental. "I think the message is if we can't settle these cases favorably, then we will quit doing (new) business in your state, and the fear is that other insurers" will pull out, he says.
Supple, of State Farm, notes, "There is no good timing for this announcement."
The bad news for homeowners, says Birny Birnbaum of the Center for Economic Justice, a consumer-advocacy group, is that "other insurers are probably going to follow suit (in pulling back on homeowners' coverage in the region) because they want to apply political pressure" like State Farm
2/12 "We Didn't Plan for That" Jackson, Miss. Reporter: Wendy Suares
State Farm Insurance got nailed for failing to pay claims from Hurricane Katrina. Checks have been sent to more than 600 Mississippi policy holders who sued the insurer, as part of an $80 billion settlement. And a separate $50 million settlement for thousands more policy holders is under a judge's review. Insurers are reeling from the storm and it could mean changes for homeowners statewide.
"We didn't plan for that. Policy holders didn't plan for that, and governments by and large didn't plan for that," said Mike Fernandez, public affairs vice-president for State Farm.State Farm is facing hundreds of hurricane damage lawsuits on the Mississippi coast. Fernandez says the outcome will shape the company's future here. Other companies have pulled out of certain areas completely.
"We've seen a lot of other players literally pull out of markets, cut back, and we shaved off a little, not too severely in Alabama, but you have to look at the particular market risk you're dealing with," Fernandez said.
And that risk has pushed up premiums for many Mississippi policy holders. State lawmakers are tackling the issue, passing legislation to shore up the state wind pool and allow companies to recoup some of their losses. Fernandez says that action is helping secure the market.
"We feel good about that movement even while we're uneasy about some of the movement in the courts," he said.
Companies like State Farm say they're uneasy, yet they're posting record profits. Industry officials expect profits this year to reach $60 billion.
"If you look at it over a period of time, there were three years when we had losses and at some point, you have to build up those reserves so you can meet that next natural disaster," said Fernandez.
A federal judge has scheduled a hearing later this month to clarify terms in the proposed $50 million State Farm settlement that would resolve disputed claims of thousands of policy holders who didn't sue.
http://www.wtok.com/news/headlines/5731836.html
2/9 State Farm policyholders will have a chance to weigh in
on two proposed class-action cases aimed at resolving Hurricane Katrina claims en masse.
U.S. District Judge L.T. Senter Jr. on Thursday ordered two hearings for Feb. 28 to consider the proposals. Property owners or their representatives can fill out forms attached to the orders to participate if their insured property was a total loss or suffered more than 90 percent damage. The forms are attached to Senter's orders posted at sunherald.com or on the federal court Web site, http://www.mssd.uscourts.gov/.
State Farm Fire & Casualty Co. is requesting a class-action settlement negotiated with the Scruggs Katrina Group of attorneys on behalf of up to 35,000 Coast policyholders. At the 1:30 p.m. hearing, Senter expects attorneys to address 10 areas of concern he has about the settlement.
A letter Senter sent to 108 attorneys Feb. 2 said, "While the proposed class action is currently limited to State Farm policyholders, any procedure the court approves as an alternative to litigation would likely serve as a de facto model that would apply to similar claims against the other major insurers, Allstate and Nationwide."
The second proposal would certify the case of Ocean Springs homeowner Judy Guice as a class-action lawsuit representing hundreds of State Farm policyholders whose homes Katrina swept away. Senter had rejected class-action certification for the Guice case, but said he will reconsider at a 10 a.m. hearing, also on Feb. 28.
Guice's attorneys are asking Senter to extend his ruling in a previous case, Broussard v. State Farm, to other policyholders with slabs. In Broussard, Senter ruled State Farm must prove the excluded peril of water caused a loss in order to deny coverage. The policyholders' only burden, he said, is to show they suffered an accidental, direct physical loss.
That is what Guice has argued all along and is the guideline the proposed Guice class-action case would follow. Her attorneys seek full coverage for those whose claims, like the Broussards, State Farm denied without proving the policy's water exclusion applied. Policyholders also would have the right to pursue punitive damages, designed to deter bad behavior, from State Farm.
The Broussards have been awarded $1 million in punitive damages, but it could be years before they collect and only if Senter's ruling is upheld through appeals.
State Farm opposes class-action certification for Guice's case. Company spokesmen say each policyholder claim is different and needs to be evaluated on its own merits. The company maintains it owes nothing under policies when wind and water damage are inseparable.
Under the class-action settlement with the Scruggs group, State Farm is willing to offer payments as a compromise. The company has agreed on slab claims to pay at least 50 percent of policy limits for structure and contents, less any wind or flood payments already received. Those with less damage would receive lower payments.
Policyholders who accept settlement checks would forfeit any right to file lawsuits or seek punitive damages.
State Farm has said the Broussard ruling probably will be appealed. Meanwhile, the company continues to follow its policy regarding separate wind and water damage, according to a claims manager forced to give sworn pre-trial testimony in the Guice case.
The State Farm claims manager, Dannye Smith, said the company's top claims executive, Susan Q. Hood, visited the Coast after the Broussard verdict and told employees the company was proud of them. Smith also said he was unaware of any procedure the company has adopted to review claims files that were not adjusted according to Senter's ruling in Broussard.
http://www.sunherald.com/mld/sunherald/16658692.htm
1/31 Judge Rejects Part Of State Farm Settlement
http://208.62.60.4/40/article_895.shtml
State Farm Katrina suits back in court
By BENNIE SHALLBETTER Jan 31, 2007, 09:20
Federal Judge L.T. Senter Jr. denied a motion "without prejudice" for a class action settlement proposed by State Farm, Attorney General Jim Hood, and a host of attorneys. The declaration allows lawyers to go back to the table with State Farm to negotiate a new settlement that satisfies the judges concerns.Local attorney Zach Butterworth, who filed the first claim against State Farm in Hancock County, says he and others have confidence that the kinks will be worked out in the settlement involving some 35,000 policy holders who did not file a suit against State Farm. Conference calls, meetings, and negotiations between the parties continued all weekend and were still continuing at press time."It's all very complicated," Butterworth said Tuesday. "But I just can't believe that State Farm would let it all blow up again after all the work."Though the terms of an agreement are complicated, each case seeking settlement being totally different, Butterworth said, the bottom line of the negotiations is simple: State Farm wants to keep money and negotiators want to get it.Policyholders involved in the Scruggs suit, more than 100 in Hancock County, should begin receiving their checks as early as Monday, Butterworth said. After months of negotiations seeing people able to go on with their lives is all the reward he wants, he said.Some of Senter's objections to the settlement include no guaranteed minimum for some categories of damage, no information to determine the extent of class claims or coverage or number of class members, State Farm and others would be released from the threat of punitive damages. Should negotiations break down at this point for other policy holders, it could mean years of litigation for those who choose to pursue claims. And apparently "good neighbor" State Farm has both the time and the money to spend years in the legal process. After eight years of litigation 70 homeowners in Oklahoma, whose homes were destroyed by tornadoes in 1999, have yet to see a penny from the company, Butterworth said.But State Farm is not the only bad neighbor in the insurance business, he said. A 1996 investigation found that Prudential defrauded more than 10 million life insurance customers in claims totaling more than $2 billion, said the American Association for Justice website.According to the Los Angeles Times insurance companies made a record $44.8 billion in 2005 and increased industry surplus by more than $427 billion, even after accounting for the claims of policyholders wiped out by Katrina.
© 2005 Bay St. Louis Newspapers, Inc.
State Farm reaches $500 million settlement
By ANITA LEE
calee@sunherald.com
An historic agreement with State Farm Fire & Casualty Co. means up to $500 million in payments to policyholders previously dissatisfied with their Hurricane Katrina insurance settlements.
Attorney General Jim Hood said Wednesday afternoon that State Farm will pay 50 percent of policy limits to certain homeowners left with only slabs. State Farm previously had denied those claims, maintaining water led to the destruction and the company was unable to find any separate wind damage covered under its policies.
The two sides signed a settlement agreement filed today in Hinds County Chancery Court, which also brings an end to the lawsuit Hood filed shortly after Katrina to seek coverage for policyholders whose homes were subject to tidal surge.
"It's not the best thing since sliced bread," Hood said. "I wanted to get everybody 100 percent. This is a settlement option primarily for the 8,000 people hit by storm surge who don't have lawyers."
Hood said State Farm has about 800 slab claims on the Coast and about 9,000 policyholders whose homes were hit by storm surge. The company, by its own count, had a total of more than 32,000 Coast Katrina claims filed as of February 2006.
He later summed up what he sees as the benefits of the settlement. "This is just an option. It will get some money on the ground quick. It will stabilize the insurance market and it will help in our economic development. We've got to rebuild our homes and the people's lives."
State Farm released a statement that read, in part, "We believe this is in the best interests of our policyholders and State Farm, and the effort to rebuild Mississippi.
"Basically, we'll work with out policyholders to review claims in the three counties - Harrison, Hancock and Jackson."
Under the settlement, State Farm has agreed to review the claims of any Coast policyholder who opts in. The settlement also gives policyholders the right to see their State Farm file. If a policyholder is dissatisfied with State Farm's offer, they can go to binding court arbitration with the company.
Policyholders who are suing the company, or who reached an agreed settlement with State Farm in mediation, are not eligible to participate. The Scruggs Katrina Group, representing 640 policyholders, also has reached a settlement of its cases with State Farm, but those terms are undisclosed.
Hood said he hopes to reach agreements with other insurance companies. As part of the agreement, he will drop a civil lawsuit that he filed shortly after the storm to seek coverage for policyholders and put on hold a criminal investigation into State Farm's claims practices.
Hood said, however, that he has been assured Congress will pursue an investigation of how the industry reacted to Katrina.
Read more on the settlement as developments happen at sunherald.com and in Wednesday's Sun Herald.
For More Information
http://katrinanetworking.blogspot.com/2006/09/state-farm-investigation.html
Labels: article, hancock county, katrina, lawsuit, MS, state farm
posted by Leslie | Wednesday, January 24, 2007
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