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State Farm Fire and Casualty Depreciation of Labor Alabama Settlement

Settlement Structure: Claims Made

Active: Open

Case Summary:

State Farm Fire and Casualty Company is settling a class action that challenged its depreciation of estimated costs of labor and other non-material costs for the repair or replacement of damaged structures that were subtracted from its actual cash value (ACV) payouts to Alabama policyholders. The complaint alleged the company had breached their policies and caused insureds to be underpaid for their losses.

Docket Number:

17-CV-148-TFM-C

Company: State Farm Fire and Casualty Company

Filing Deadline: October 24, 2022

Class Period: March 8, 2011 to August 2, 2017

Objection Deadline: August 24, 2022

Exclusion Deadline: August 24, 2022

Final Approval Hearing: September 23, 2022

Proof of Purchase:

You do not have to provide proof to submit the Claim Form.

Eligibility:

You may be eligible if you are a person or entity who was insured under a State Farm structural damage policy who (1) made a structural damage claim for property located in Alabama, with a loss date between March 8, 2011 and August 2, 2017, (2) which resulted in an ACV payment during that period from which “non-material depreciation” was withheld, or which would have resulted in an ACV payment but for the withholding of the “non-material depreciation” causing the loss to drop below the deductible.

Excluded from the class are (1) persons and entities whose claims arise under policies with State Farm coverage form WH-2101 or endorsement form FE-3650, or any other policy form expressly allowing the “depreciation” of “labor” in the text of the policy form; (2) persons or entities that received ACV payments from State Farm that exhausted the applicable limits of insurance on the declarations page; (3) State Farm and its affiliates, officers, and directors; (4) members of the judiciary and its staff to whom this action is assigned; and (5) class counsel in this case.

Typical Settlement Amount:

Benefits to four different groups:
- Group A: Those who previously received only an ACV payment from which non-material depreciation was deducted who did not receive any subsequent replacement cost benefit payments will receive 100% of the non-material depreciation deducted plus 44% of the estimated General Contractor Overhead and Profit Depreciation (if any) that was deducted from the ACV payment, plus simple interest of 5.55% on those amounts from March 8, 2017 to the effective date of this settlement.
- Group B: Those who previously received partial RCBs, where non-material depreciation was deducted from their ACV payments and who partially recovered the non-material depreciation costs, will receive 100% of the estimated non-material depreciation that was not fully recovered, plus 44% of the estimated General Contractor Overhead and Profit Depreciation (if any) that was initially deducted from the ACV payment that was not fully recovered, plus simple interest of 5.55% from March 8, 2017 to the effective date.
- Group C: Those who previously received full RCBs, where non-material depreciation was initially deducted from their ACV payments and who later recovered all the non-material depreciation, will receive simple interest of 5.55% from the date of the initial ACV payment to the date of the final replacement cost payment.
- Group D: Those who would have received an ACV payment but for the application of non-material depreciation will receive 100% of the portion of the non-material depreciation they did not receive because the withholding of non-material depreciation caused the ACV to drop below the applicable deductible, plus simple interest of 5.55% on those amounts, between March 8, 2017 and the effective date.

State Farm has a right to challenge or reduce the amounts to be paid on the grounds that (1) the claimant is not a class member, (2) the non-material depreciation portion of the payment would exceed the policy’s liability limit, or (3) the non-material depreciation portion of the payment was already recovered through replacement cost benefit payments, as set forth in the Settlement Agreement, which is available at https://www.arnold-v-statefarm.com/admin/api/connectedapps.cms.extensions/asset?id=48083a02-6b88-4995-910d-b568f016bc65&languageId=1033&inline=true.

Total Settlement Amount: Unknown

Class Representative Proposed Incentive Fee:

$15,000-$20,000

Law Firms:
Gilbert McWherter Scott Bobbitt PLC
Mehr Fairbanks & Peterson Trial Lawyers PLLC
Snodgrass Law, LLC

Claim Form: Arnold v. State Farm Settlement Claim Form

Case Name: Arnold, et al. v. State Farm Fire and Cas. Co.

Settlement Website: Arnold v. State Farm Settlement Website

Claims Administrator:
JND Legal Administration

Claims Administrator Contact Information:

Arnold v. State Farm Settlement
c/o JND Legal Administration
PO Box 91431
Seattle, WA 98111
877-540-0864

Tags: Depreciation of Labor Costs, Insurance, Property Damage from Incident