Two industry organizations have come out against MississippiAttorney General Jim Hood's decision to file suit against StateFarm related to an agreement for a mass settlement of claims overHurricane Katrina damage.

U.S. Chamber Institute for Legal Reform President Lisa A.Rickard derided Hood's decision in a release, and accused theattorney general of having ulterior motives. "This latest lawsuitby the Mississippi attorney general has little to do withcompensating Mississippi homeowners for their Katrina losses, andmore to do with plaintiffs' lawyers getting their cut of thecompensation money," she said. "With this newest lawsuit, thebottom line is not whether the people of Mississippi will get faircompensation on their losses, it is whether or not the stateattorney general can subvert a fair process in order to give triallawyers a cut -- ultimately at the expense of Mississippihomeowners."

The National Association of Mutual Insurance Companies (NAMIC)also expressed disappointment over the legal action. "It isdisheartening to hear that Attorney General James Hood's lawsuithas the potential to disrupt the continuation of a recently agreedupon process between State Farm and the Mississippi InsuranceDepartment that can help thousands of victims of HurricaneKatrina," said Neil Alldredge, NAMIC's vice president of state andregulatory affairs. "The agreement that was reached between StateFarm and the state of Mississippi in January is working. As StateFarm rightly points out, it entered into the contract voluntarily.The company has mailed more than 30,000 letters to policyholders,has received thousands of responses, and has been processing theclaim reevaluation requests.

"The agreement is in its early stages and needs time to be fullydeveloped," continued Alldredge. "Instead of giving the process achance, however, Mr. Hood has again demonstrated an over-eagernessto point the finger at insurers, with his first litigationannouncement coming shortly after Katrina. This is yet anotherexample of political grandstanding at the expense of policyholdersand the public."

Interested in more legal news and in-depth articles? Head overto Claims' legal channel for more information.