State Farm starts notifying policyholders of Katrina agreement
as posted at www.sunherald.com
by ANITA LEE
Apr. 12, 2007
GULFPORT — State Farm Fire and Casualty Co. has begun notifying policyholders that they can have their Hurricane Katrina claims re-evaluated.
The first round of letters will go out today to more than 1,000 policyholders left with only slabs after the storm, according to a company news release. By the end of April, a total of about 35,000 State Farm policyholders will receive the letter explaining the re-evaluation process and how to participate.
"While State Farm has already paid more than $1.2 billion to help Mississippi policyholders rebuild from the devastation of Hurricane Katrina, this agreement was reached in an effort to resolve any remaining questions or differences of opinion in a fair and efficient manner," a company news release says.
State Farm will commit a minimum of $50 million to the process and has agreed to pay slab owners a minimum 35 percent of their structural policy limits, minus flood or other insurance payments received.
State Farm said it has designed the re-evaluation process to turn around the claims as quickly as possible. Anyone who is dissatisfied with the process can opt out before an agreement is reached and pursue other options.
"We're really trying to encourage people: Don't call until you get that letter in your hand," said Jeff McCollum. "We're trying to avoid a situation where 35,000 people are all calling in at the same time to more efficiently handle all these reviews."
State Farm had worked out a settlement agreement to revisit all its Coast claims with attorneys from the Scruggs Katrina Group, but a U.S. District Court judge denied approval based on numerous unresolved issues.
State Farm is instead re-evaluating the claims under an agreement with Mississippi Insurance Commissioner George Dale. State Farm says it will pay only for damage caused by wind and wind-driven rain.
Policyholders who are suing the company can opt for the re-evaluation, but those who settled their claims through court-ordered mediation are not eligible for the review. Slab owners who settled their claims through state-sponsored mediation can participate in the review.
United Policyholders is a non-profit organization founded in 1991 and dedicated to educating the public on insurance issues and consumer rights. UP publishes educational materials and serves as a resource for individual and business policyholders and residents of communities with insurance problems. UP’s Amicus Project provides information to courts of law to support policyholders’ legal rights. UP unites policyholders and their advocates by sharing information. Write to UP at 110 Pacific Ave., PMB 262, San Francisco, CA. 94111, call us at (510) 763-9740, or visit our website at www.unitedpolicyholders.org.
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