State Farm agrees $1.35 million settlement with Kentucky

Attorney general details agreement

State Farm agrees $1.35 million settlement with Kentucky

Insurance News

By Mika Pangilinan

State Farm has agreed to pay $1.35 million to the state of Kentucky as part of a settlement resolving allegations concerning its failure to adequately inform customers about coverages available under their auto insurance policies.

A news release from Attorney General Daniel Cameron confirmed that Kentucky will receive a lump sum payment to reimburse the cost of its investigation.

State Farm has also enhanced its notification policies, conducted staff training on revised claim procedures, and implemented a database search tool allowing customers to identify available coverages easier, according to the release.

Additionally, it agreed to “use its best efforts” to begin the process of providing multi-car policies in Kentucky.

“This settlement with State Farm provides us confidence in State Farm in its role as an important insurer in the Commonwealth,” said Cameron. “I’m grateful to State Farm for working with us to come to a fair resolution and for taking concrete steps to ensure something like this does not happen again.”

The state of Kentucky had accused the insurance giant of not being fully transparent with its customers regarding uninsured and underinsured coverages under their policies.

Cameron’s statement noted that the settlement agreement between State Farm and Kentucky is not an admission of guilt.

In other State Farm news, the company had reported a decline in catalytic converter theft claims in the first half of 2023.

Data released by State Farm in October revealed that it paid $41.7 million in catalytic converter theft claims during the first six months of 2023, down from $50 million in the same period last year.

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