Wednesday, February 14, 2007

Like A Good Neighbor, State Farm Runs Away

In the wake of Hurricane Katrina, State Farm is baling out of the Mississippi market. Their motto, "Like a good neighbor, State Farm is there," apparently no longer applies in that storm damaged state. From an AP story today:

State Farm: No new policies in Miss.

State Farm Insurance Cos. is suspending sales of any new commercial or homeowner policies in Mississippi starting Friday, citing in part a wave of litigation it has faced after Hurricane Katrina, a company official said Wednesday.

Mike Fernandez, vice president of public affairs for State Farm, said Mississippi's "current legal and political environment is simply untenable. We're just not in a position to accept any additional risk in this homeowners' market."

One has to assume this is related to State Farm getting whacked with a $2.5M punitive damage award for failing to honor their Mississippi policies. (State Farm should be used to punitive damages by now, having been hit before and finding the case go all the way to the Supreme Court.)

State Farm's troubles are probably not helped by the fact that Senator Trent Lott is a State Farm policyholder that had to hire an attorney to recover on his own policy.

Apparently, State Farm finds its easy to collect premiums but isn't all that thrilled about paying out claims. These are the types of "good neighbors" I can do without.

Labels: Insurance Industry

posted by Eric Turkewitz  # Permanent Link

Comments:

You, sir, should research the topic before commenting on it. Do you have knowledge of State Farm's claim history? Do you know the reason that the Katrina claims are being denied? Because water damage, of any kind, wind driven or not, is NOT covered by a typical homeowners policy. The policyholders were not paying premiums to State Farm for Flood coverage so why should State Farm pay for Flood damage?
Until you can prove that State Farm consistently denies claims, you should remain mum on the types of "good neighbors" you can do without. Yes, I am State Farm insured and am happy to be with them. If there is a lesson to be learned out of all of this, here it is: Take one hour every year to meet with your insurance agent to make sure you understand your policies (including losses not covered) and to make sure that you are properly insured.

# posted by  Anonymous : March 05, 2007 4:55 PM

 

Until you can prove that State Farm consistently denies claims, you should remain mum on the types of "good neighbors" you can do without.

As dicussed in the posting, State Farm not only lost at trial, but was hit with punitive damages. The proof, apparently, was in the courtroom.

--ET

# posted by  Eric Turkewitz : March 05, 2007 5:31 PM

 

As you said... the proof WAS in the courtroom. One that was not bribed by Dickie Scruggs evidently.

http://money.cnn.com/2008/04/09/news/newsmakers/parloff_scruggs.fortune/

I'd be interested in if you have a change of opinion.

# posted by  Anonymous : May 26, 2008 1:29 AM

 

It wasn't Scruggs that created two different engineering reports for the same property, but State Farm.

# posted by  Eric Turkewitz : May 27, 2008 9:48 AM

 

They will just end up doing what Century 21 did and change their name to AGIdirect and re-invent themselves.

# posted by  Anonymous : August 14, 2008 12:33 PM

 

Post a Comment

Links to this post:

<$BlogBacklinkTitle$>  
<$BlogBacklinkSnippet$>

posted by <$BlogBacklinkAuthor$> @ <$BlogBacklinkDateTime$>

Create a Link

<< Home

The New York Personal Injury Law Blog is sponsored by its creator, Eric Turkewitz of The Turkewitz Law Firm. The blog might be considered a form of attorney advertising in accordance with New York rules going into effect February 1, 2007 (22 NYCRR 1200.1, et. seq.) As of July 14, 2008, Law.com became an advertiser, as you can see in the sidebar. Law.com does not control the editorial content of the blog in any way.

Throughout the blog as it develops, you may see examples of cases we have handled, or cases from others, that are used for illustrative purposes. Since all cases are different, and legal authority may change from year to year, it is important to remember that prior results in any particular case do not guarantee or predict similar outcomes with respect to any future matter, including yours, in which any lawyer or law firm may be retained.

Some of the commentary may be become outdated. Some might be a minority opinion, or simply wrong. No reader should consider this site (or any other) to be authoritative, and if a legal issue is presented, the reader should contact an attorney of his or her own choosing for advice.

Finally, we are not responsible for the comments of others that may be added to this site.