Regulator: State Farm will re-examine Katrina claimsMar 20, 2007 | AP Hurricane Katrina and "make millions of dollars available" for additional payments, Mississippi Insurance Commissioner George Dale said Monday.
Dale said the agreement between his office and State Farm covers homeowners, renters and commercial claims in Mississippi's three coastal counties.
The agreement with the Bloomington, Ill.-based insurer includes claims that are in mediation, those that are the subject of pending lawsuits and those that have been settled.
"If they feel like they were mistreated and not handled properly, they, too, can have their case reopened and looked at by additional adjusters," Dale said of customers who already have settled.
Dale said State Farm agreed to the re-examination based on his agency's examination of its handling of Katrina claims and the recent withdrawal of a proposed class-action settlement involving the insurer.
On March 12, a team of lawyers who helped negotiate the proposed settlement withdrew their request for U.S. District Judge L.T. Senter to approve the deal.
Senter had been asked to approve a settlement calling for State Farm to pay at least $50 million to policyholders who haven't sued the company. That deal, reached in January, called for State Farm to reopen, review and possibly pay 35,000 to 36,000 claims.
"When I learned that the proposed class-action settlement had stalled, I felt it presented an opportunity to negotiate with State Farm to bring closure for coastal policyholders," Dale said Monday.
State Farm spokesman Phil Supple said the company's agreement with Dale "generally follows" the same terms as the agreement that Scruggs presented to Senter in January. The company has agreed to pay a minimum of $50 million, but "there's no ceiling" on the total amount paid, he said.
One key difference between the two deals, according to Supple, is that Dale's mediation program would aim to resolve any lingering disputes between State Farm and policyholders.