Insurance Crisis Creeps North
By
The Associated Press
Published: Fri, January 04, 2008 - 3:00 pm
Last Updated: Fri, January 04, 2008 - 3:02 pm
Last Updated: Fri, January 04, 2008 - 3:02 pm
reached a settlement with State Farm Fire and Casualty Company on
22 cases stemming from damage from Hurricane Katrina.
State Farm spokesman Fraser Engerman declined Wednesday to
comment further because terms of the settlement are confidential.
The policyholders' attorney, William F. "Chip" Merlin, said
documents State Farm has been forced to produce in previous cases
put clients in a good negotiating position.
Merlin said the documents and testimony from State Farm
officials indicate the company decided against paying claims in
areas hit by the storm surge, relying on policy language to deny
those claims without thorough investigations.
In cases in which wind and water combine to cause a loss, the
5th U.S. Circuit Court of Appeals has ruled policy language
precludes coverage.
However, Merlin said that does not relieve insurance companies
of their duty under Mississippi law to fully investigate the cause
of a loss and pay for wind damage covered under an all-perils
policy.
State Farm maintains the company investigated each
policyholder's claim and covered independent wind damage.
(Copyright 2008 by The Associated Press. All Rights Reserved.)
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