A former administrator of the National Flood Insurance Programsays he does not believe State Farm committed fraud while adjustingclaims after Hurricane Katrina in 2005.

David Maurstad, NFIP administrator for 4 years beginning in June2004, testified for the insurer in Mississippi federal court duringa whistle-blower trial.

Former independent adjusters Cori and Kerri Rigsby allege thecompany defrauded the federal government by shifting wind losses toflood loss reimbursed by the NFIP.

According to Anita Lee of The Sun Herald, Maurstad and JimShortley, a former NFIP claims manager, say they consulted withState Farm and other insurers to come up with a plan to streamlineNFIP's claims-handling process after the program had come underfire for paying slaws too slowly.

Following the massive hurricane, NFIP decided claims adjusterscould forego line-by-line estimates for each piece of a damagedhome when it was clear the damage exceeded policy limits.

The Rigsbys, who worked for an independent adjuster hired byState Farm after Katrina, say State Farm used this approach, whichthey contend does not meet NFIP protocol. But the NFIP officialssay the rules were changed following the extraordinarycircumstances Katrina presented.

State Farm says it never attempted to influence adjusters orengineers in assessing damage after Katrina. The company continuesto present its case.

Kerri Rigsby testified last week about her knowledge of Thomasand Pamela McIntosh's home in North Biloxi. The case has beenlimited to this one house—the only home a judge has said theRigsbys have firsthand knowledge.

The McIntoshes four years ago settled a lawsuit with State Farm,saying “there is no credible evidence” the insurer acted in badfaith while handling their claim.