Insurance Giant Handing $20,925,000 To Customers, Settling Accusations of Selling Misleading Coverage

One of the largest insurance companies in the US has agreed to pay millions of dollars to compensate its customers after allegedly selling them worthless insurance coverage.

State Farm will set up a $20.93 million fund to settle a class action lawsuit that was initially filed in February of 2018. The class action lawsuit alleged that State Farm engaged in “intentional misrepresentation” of its products and consequently sold insurance to New Mexico motorists that essentially provided them with “illusory” coverage.

The settlement class includes all those who purchased State Farm’s U Coverage insurance policies in New Mexico between January 1st of 2010 and December 31st of 2021. The compensation offered will be determined by the amount in premiums that each settlement class member paid and then calculated on a pro rata basis depending on the total number of claims.

“If you are a Settlement Class Member, you may be eligible for a Settlement Payment in an amount representing up to 21% of premiums you paid for minimum limits U Coverage purchased between 2010 to 2021 and 13% of premiums you paid for non-minimum limits U Coverage purchased between 2010 to 2021.”

To receive compensation, claims must be submitted on or before July 2nd. The final settlement hearing will be held on June 8th.

Despite agreeing to the settlement, State Farm denies any wrongdoing. No court of law has ruled on the matter, either in favor of State Farm or the plaintiffs.

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