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Settlement reached in Katrina lawsuit

Mar 21, 2007 | AP

State Farm settled out of court with a Biloxi, Miss., couple whose lawsuit over Hurricane Katrina damage was scheduled to be tried next week in federal court, a lawyer for the homeowners said Tuesday. Terms were not disclosed.

State Farm's settlement with John and Ann Untershine marks the fourth time this month that the Bloomington, Ill.-based insurer has settled out of court with policyholders whose homes were destroyed by Katrina.

An attorney who represented homeowners in all four cases set for trial this month against State Farm Fire and Casualty Co., said settlements are becoming easier to broker as more Katrina insurance cases are tried.

"Our hope all along is that once we tried a few of these cases, it would put both sides in a better position to evaluate these claims," he said.

State Farm spokesman Phil Supple said of the latest settlement that "we're pleased we were able to come to an agreement before trial and avoid potentially lengthy and costly litigation for our customers as well as our company."

Hundreds of policyholders in Mississippi coastal counties filed lawsuits after State Farm denied at least part of their claims. State Farm and other insurers say their policies cover damage from wind but not from water, including wind-driven storm surge.