A Florida court has approved a $6.8 million class action settlement for 12,000 State Farm Florida policyholders with hurricane claims for screen enclosure damage, attorneys for the plaintiffs announced yesterday.
Lee & Amtzis and Kopelman & Blankman law firm in Boca Raton, Fla., said the policyholders will receive 100 percent of the damages they sought with a lawsuit alleging State Farm refused to pay replacement costs of screen enclosures damaged by Hurricanes Katrina and Wilma.
State Farm spokesman Phil Supple said the problem had arisen because depreciation language standard for Florida insurance policies had been inadvertently dropped in printing up the policies for the five counties where the class plaintiffs are located.
He said that, when made aware of the error, the company was willing to make policyholders whole and disagreed with the attorneys' characterization of events.
According to the lawyers, State Farm depreciated the cost of screen enclosures damaged by the hurricanes, allowing the insurer to pay significant discounts to replace the screens. Attorneys for the plaintiffs argued that State Farm's policy directly contravened the language of the policyholders' agreements.
Eric Lee, lead counsel for the plaintiffs, said, "The settlement approved by the court is significant in that more than 12,000 State Farm policyholders in Florida will be made completely whole. There have been many lawsuits against insurance companies related to hurricane damage, but few that have resulted in a complete recovery of the plaintiffs' damages."
Jason Hammett, lead plaintiff in the case, first filed his action Feb. 6, 2006. Hammett brought claims on behalf of himself and all Florida homeowners who submitted claims to State Farm for damages to screening enclosures during Hurricanes Katrina and Wilma in 2005.
The settlement was approved by Judge Victor Tobin with the Broward County 17th Judicial Circuit Court in Fort Lauderdale, Fla.
Under the settlement stipulations, State Farm will pay a class of more than 12,000 policyholders 100 percent of the damages claimed and establish a fund of $6,788,200 to make payments to class members.
The agreement also requires the insurer to pay the costs of administering the settlement and all attorneys' fees and other expenses in addition to the payments to class members.
Under the settlement, checks to class members are due to go out 60 days after the final judgment has been entered on July 21.
Mr. Supple said when the issue "came to our attention, lawyers came to us with this proposed class action and we looked into it and discovered that language that limited screening claims to actual cash value [which includes depreciation] had been inadvertently omitted from endorsements that were held by policyholders in these five Florida counties."
He continued, "The situation was due to a printing error and State Farm immediately offered to pay customers additional amounts they were due under their policies. We promptly corrected the wording error in the policy endorsement."
Asked about Mr. Supple's comment, Mr. Lee responded: "They say it was a printing error; we're not sure. When we filed the lawsuit, they settled the case."
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.