State Farm settles with Mississippi Attorney General to avoid criminal prosecution
Back in January, 2007, State Farm agreed to a special arrangement for handling Hurricane Katrina homeowner's claims, in order to end a criminal investigation into its' claims practices. The Attorney General alleged that State Farm did not fulfill its obligations under the agreement, however, and that it did not adequately address the establishment of a federal court approval process.
Under the new agreement reported this week, State Farm agreed to pay 74 million dollars in additional damages to homeowners who had previously settled, according to the Mississippi Clarion-Ledger, and to notify another 150 policyholders of their right to have their claims re-evaluated under the revised procedure. The Attorney General was reported to have claimed that if State Farm had abided by its original 2007 agreement, it would have paid out an additional 400 million dollars.