State Farm agrees to pay Georgia drivers $250 million for lost value of wrecked cars
Saturday, January 5th 2002, 12:00 am
By: News On 6
ATLANTA (AP) _ State Farm Mutual Automobile Insurance Co. has agreed to a $250 million settlement that involves paying as many as 700,000 Georgia motorists for the lost value of damaged cars.
The settlement ends a class-action lawsuit filed two years ago in which Georgia policyholders contended their vehicles were worth less after a wreck no matter how well they were repaired.
State Farm, based in Bloomington, Ill., had claimed that properly repaired cars did not diminish in value.
The settlement, announced Friday, requires State Farm to pay $100 million in diminished value reimbursements for accident claims filed since Dec. 22, 1993. An additional $50 million will be paid for court costs and attorneys' fees.
Eligible policyholders will receive at least $25 and up to several thousand dollars, depending on the amount of the original claim.
State Farm and the plaintiffs, in a joint statement, said the settlement served the interests of company policyholders by avoiding the risks of further litigation.