OKLAHOMA CITY (KFOR) – Following devastating earthquakes in Oklahoma, state leaders say they have finally reached a settlement agreement with Farmers Insurance.
From 2010 through May of 2016, officials say only 19 percent of earthquake insurance claims in Oklahoma were paid.
In fact, many homeowners who suffered significant earthquake damage had their claims denied because the insurance companies deemed the damage as just settling.
Now, Oklahoma Attorney General Mike Hunter and Insurance Commissioner Glen Mulready say they have reached a $25 million settlement with Farmers Insurance for the company’s handling of earthquake claims.
An investigation revealed that Farmers denied or failed to properly pay around 1,000 earthquake claims submitted by Oklahomans who purchased coverage.
As a result, the company will reopen the claims process and re-evaluate the claims using an independent administrator. Claims approved by the administrator will then be paid related to the individual’s policy.
“This is a great win for Oklahomans who paid premiums for a Farmers earthquake insurance policy,” Attorney General Mike Hunter said. “I am happy to announce that after negotiations, Farmers agreed to this settlement. Through an exhaustive process, we will ensure each Oklahoman who sustained legitimate damage from an earthquake and submitted a claim to Farmers will have an opportunity for their claim to be independently reviewed and the damage to their property repaired.”
According to the agreement, Farmers will make additional payments as needed if property damages exceed the agreed upon amount to pay eligible earthquake claims.
“This latest settlement serves as another example that the attorney general and I are committed to protecting all Oklahoma consumers,” said Oklahoma Insurance Commissioner Glen Mulready. “We appreciate the partnership of the attorney general in resolving this matter.”
Officials say Farmers will send each eligible Oklahoman a written notice that their claim has been reopened for review.
If an eligible individual has more than one eligible earthquake claim, all eligible earthquake claims will be re-examined.
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