Two industry organizations have come out against Mississippi Attorney General Jim Hood's decision to file suit against State Farm related to an agreement for a mass settlement of claims over Hurricane Katrina damage.

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

The National Association of Mutual Insurance Companies (NAMIC) also expressed disappointment over the legal action. "It is disheartening to hear that Attorney General James Hood's lawsuit has the potential to disrupt the continuation of a recently agreed upon process between State Farm and the Mississippi Insurance Department that can help thousands of victims of Hurricane Katrina," said Neil Alldredge, NAMIC's vice president of state and regulatory affairs. "The agreement that was reached between State Farm and the state of Mississippi in January is working. As State Farm 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 the claim reevaluation requests.

"The agreement is in its early stages and needs time to be fully developed," continued Alldredge. "Instead of giving the process a chance, however, Mr. Hood has again demonstrated an over-eagerness to point the finger at insurers, with his first litigation announcement coming shortly after Katrina. This is yet another example of political grandstanding at the expense of policyholders and the public."

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Industry Groups Criticize Hood's Latest Lawsuit

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