State Farm Extends Replacement Deadline For Eligible Policyholders Impacted by Hurricanes Katrina and Rita in Mississippi and Louisiana

Bloomington, Illinois, August 31, 2007 – State Farm announced today, customers who sustained covered damage during Hurricanes Katrina or Rita, in Mississippi or Louisiana, will be given one extra year to repair or replace the damaged property and contents in order to claim the replacement cost available under the State Farm policy.

Generally, covered damaged property is paid to the policyholder on an actual cash value basis (depreciated amount) at the time of the loss, and once the item or structure is repaired or replaced, the depreciation (replacement costs , if applicable) is paid, resolving the claim.  In order to recover the replacement costs the homeowners policy provides that the policyholder must complete the repairs or replacement of covered property within two years of the date of loss. 

Today, State Farm announced, in cooperation with the Mississippi and Louisiana Departments of Insurance, it would voluntarily extend the company’s homeowners policy replacement cost provision from two years to three years, without waiving this or any other policy provision.  This time extension may also apply to other State Farm policies with comparable replacement cost payment time limitations in these two states. 

In cases where a replacement cost claim is presented after the original two year time period deadline, the policyholder is encouraged to provide their documentation to the appropriate claims office. 

State Farm maintains any payments made in this voluntary extension are not intended as a waiver of the two year loss settlement provision, nor are they meant to extend the time period for any other coverage, nor are they waiving any other policy provision; including but not limited to newly reported claims, additional living expense claims, and any suit limitation provision.