State Farm subsidiary agrees to $100 million settlement




State Farm Fireplace and Casualty Firm – a subsidiary of US insurance coverage big State Farm – has agreed to pay the federal authorities some $100 million in restitution over its alleged mismanagement of flood insurance coverage claims associated to Hurricane Katrina.

The insurer can pay the $100 million in restitution to the federal authorities, and to not particular person policyholders.

In response to the Related Press, the settlement marks the tip of authorized proceedings which started over 16 years in the past, when former adjusters Cori and Kerri Rigsby filed a lawsuit towards State Farm for allegedly shifting state claims to the federal Nationwide Flood Insurance coverage Program (NFIP) when the claims ought to have been paid by personal insurance coverage as an alternative.

As a part of the settlement, State Farm has additionally agreed to dismiss the counterclaims it filed towards the Rigsby sisters. The insurer had alleged that the 2 had breached their employment agreements and infringed different legal guidelines by taking the corporate’s paperwork whereas working as unbiased contractors.

Learn extra: Top 10 largest home insurance providers in the US in 2022

Guardian firm State Farm was ranked the biggest house insurer within the US by the Nationwide Affiliation of Insurance coverage Commissioners for 2022. As of April 2022, State Farm commanded 24.26% of the US house insurance coverage market, with direct premiums written of $22 billion and direct premiums earned of $20.7 billion.

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