November 2006: Insurance Dept examines small number of claims
In fall 2006, Mississippi Insurance Department (MID) announced market conduct examinations of several major insurers related to their handling of policyholders' claims after Hurricane Katrina. State Farm® is the largest homeowners insurer in the state and was selected to undergo the exam first.
- Acknowledged the vast majority of customers in Mississippi are satisfied with their State Farm claim-handling experience following Hurricane Katrina.
- Asserted that policyholders who are dissatisfied are largely those whose homes were completely destroyed. Commissioner Dale asked State Farm to identify these “slab” claims located in the lower six counties of Mississippi, indicate the amount paid on these claims and indicate what action State Farm plans to take regarding these claims.
We provided the commissioner information requested on the small group of claims involved. Many of these claims have already been resolved through the department's successful mediation program. The commissioner also acknowledged, “… the great majority of State Farm customers appear to be satisfied with the way their claim was handled …”
Market conduct exams of insurers are not uncommon following a large catastrophe. In fact, following Hurricane Georges in 1998, the Mississippi Insurance Commissioner’s office conducted a review of State Farm's claims activity. We expected the Commissioner would exercise his regulatory responsibilities at the appropriate time after Katrina to ensure all insurers doing business in Mississippi met their obligations to policyholders. We are cooperating fully with this review of our claim handling.
State Farm has helped thousands of Mississippians. We're proud of the efforts of our agents and employees in helping our policyholders recover by paying what we owe promptly and courteously.