WASHINGTON--Sen. Trent Lott, R, Miss., who has assailed the insurance industry for its Hurricane Katrina claims handling, has ended his federal case against State Farm over damage from the storm.

A spokesperson for State Farm, said today he could "confirm that we have reached a tentative settlement with Senator Lott's claim," which was due for trial in federal court.

The senator sued the insurer after his shorefront home in Pascagoula, Miss. was torn off its foundation slab by Katrina, when the carrier balked at paying for wind damages.

No terms were disclosed, but Fraser Engerman, the State Farm spokesperson said, "We're pleased that we have reached this tentative settlement, which will avoid lengthy and expensive litigation for both parties."

No details were announced. Zach Scruggs, his lawyer at the Scruggs law firm in Gulfport, Miss., and Sen. Lott's office in Washington both declined repeated requests for comment.

The settlement was a surprise and disclosed by the senator to a Mississippi insurance agent who visited him yesterday as part of the Independent Insurance Agents & Brokers of America's Legislative Conference and Convention, now underway in Washington.

In commenting on the tentative settlement with Sen. Lott, Mr. Engerman added that State Farm "hopes in the coming days and weeks to resolve even more claims with our [Katrina claims handling] agreement with Mississippi Insurance Commissioner George Dale."

Mr. Engerman said the company, as a result of its agreement with Mr. Dale, has already have received responses to a mailing sent to policyholders who were left with nothing but a foundation slab after the hurricane. The letter provided information on how to reopen claims.

As a result of the Dale agreement, State Farm will also be sending out information "to 35,000 policyholders in three coastal counties giving them information how they can go about having their claim reexamined," said Mr. Engerman

Sen. Lott referred to himself as a slab-owner during testimony at a February Senate Judiciary Committee hearing on the insurance industry's exemption from antitrust laws under the McCarran-Ferguson Act. Sen. Lott is a co-sponsor along with the leadership of the Judiciary Committee of legislation that would repeal the industry's antitrust exemption.

Sen. Lott told the Associated Press last month that he was reviewing a settlement offer from State Farm. Sen. Lott has said he has not heard from State Farm since he spoke with an adjuster, but he commented, "I think that they've heard from me a few times." A week later, trial of his lawsuit in U.S. District Court in Gulfport, Miss., originally scheduled for June was delayed until September.

Special Reports /

Sen. Lott Settles With State Farm

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