In Oklahoma, we’ve been maintaining a detailed eye on State Farm Fire and Casualty Company and its claims dealing with practices, because it appears one thing inside State Farm has modified, making litigation in opposition to it extra frequent. This graphic depicting the trajectory of insurance-related lawsuits involving State Farm in federal courts all through the nation is telling:1
One case we’ve stored a selected eye on is Bates v. State Farm Fire and Casualty Company,2 which is pending within the Western District of Oklahoma. On November 7, 2022, after a five-day jury trial and practically six hours of deliberation by the jury, the jury rendered a verdict discovering State Farm breached the insurance coverage contract and didn’t act in good religion and with truthful dealing in direction of its insured, Mr. Bates. In doing so, the jury awarded $15,800.00 for breach of contract damages and $325,000.00 for State Farm’s dangerous religion conduct.3
At trial, the jury heard proof of a major hailstorm hitting the Plaintiff’s rental property and damaging the Plaintiff’s roof. State Farm investigated the reported injury by sending a then-brand-new adjuster to examine the house. This adjuster lacked any real-world expertise assessing or investigating hail injury, having solely lately accomplished her preliminary coaching with State Farm, which was fully digital apart from the few roofs she inspected with one other adjuster. Of the roofs she had beforehand inspected with the opposite adjuster, none had been discovered to have hail injury. The adjuster in Bates discovered coated hail injury to the smooth metals of the house however to not the shingles. This resolution prompted Plaintiff’s consultant to request a reinspection by State Farm with an skilled adjuster. State Farm refused to grant the reinspection. The jury additional heard proof of a number of errors made by the adjuster, together with a miscalculation of the depreciation utilized in State Farm’s estimate of damages and a failure by State Farm to pay for a mailbox and different smooth metals State Farm agreed had been broken by hail and coated by the insurance coverage coverage.
Importantly, the jury additionally heard testimony from a former State Farm adjuster with greater than 13 years of expertise adjusting property losses. She testified a couple of coaching initiative generally known as “Hail Focus.” According to this adjuster, when Hail Focus was initiated, her direct supervisor and Team Manager stripped her of her means to approve cost of roof replacements with out first acquiring approval from the Team Manager. This meant she couldn’t chalk areas of the roof she felt had been broken by hail till first talking with the Team Manager; she couldn’t approve cost for a roof substitute on-site throughout an inspection except first acquiring approval from the Team Manager; and she or he couldn’t inform property homeowners, contractors, or public adjusters of her resolution to pay for the roof till she first obtained approval from the Team Manager. At trial, the Team Manager, who’s notably now a Section Manager, denied data of the Hail Focus initiative. The Section Manager offered related trial testimony.
The Bates verdict got here solely a month and a half after a distinct Oklahoma jury discovered State Farm breached an insurance coverage contract with its insureds and didn’t deal with its insureds in good religion. In Rowan v. State Farm Fire and Casualty Company, an Oklahoma County jury awarded the Plaintiffs $70,400.00 for State Farm’s breach of contract and $680,000.00 for State Farm’s dangerous religion conduct.4 In Rowan, a storm ripped the Plaintiffs’ roof from their house and broken the inside of the house and the house’s contents. State Farm decided the house suffered no structural injury; ignored the Plaintiffs’ repeated issues relating to the house’s electrical wiring; performed an outcome-oriented investigation into the Plaintiffs’ declare; and retained biased consultants to help State Farm’s place.
Needless to say, State Farm’s claims dealing with conduct rightfully deserves scrutiny. Like all insurers in Oklahoma, State Farm is prohibited from unreasonably, and in dangerous religion, withholding cost of a declare owed to its insured.5 If State Farm delays issuing cost to its insured, then it will need to have an inexpensive foundation for doing so, and it should additionally deal with its insured pretty and in good religion.6
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1 Source: Lex Machina
2 Bates v. State Farm Fire & Cas. Co., No. 5:21-cv-00705 (W.D. Okla.).
3 Bates v. State Farm Fire & Cas. Co., No. 5:21-cv-00705 (W.D. Okla. Nov. 7, 2022).
4 Rowan v. State Farm Fire & Cas. Co., Oklahoma County Case No. CJ-2017-7301 (Okla. July 27, 2022).
5 Christian v. Am. Home Assurance Co., 577 P.second 899, 905 (Okla. 1977).
6 Ball v. Wilshire Ins. Co., 221 P.3d 717, 724 (Okla. 2009).