Oklahoma accuses State Farm of corporate scheme to deny claims for disaster damage

Oklahoma Attorney General Gentner Drummond has accused insurance giant State Farm of conducting a coordinated “corporate scheme” to deny homeowner claims for wind and hail damage.In a statement to Realtor.com, State Farm denied the allegation and said it believes Drummond’s claims are “politically motivated.” Drummond is currently vying for the Republican nomination in Oklahoma’s gubernatorial race.Drummond filed suit against the insurer Wednesday in Cleveland County District Court, alleging State Farm built an internal program to reduce and minimize claim payments to Oklahoma customers.The AG accused the company of “a corporate scheme that threatens the integrity of Oklahoma’s insurance marketplace and undermines public confidence in an industry families rely on when disaster strikes.”State Farm told Realtor.com the lawsuit was politically motivated.It argued it has paid $1 billion to Oklahoma customers for wind and hail damage.“The Attorney General’s lawsuit does not change the facts,” the company said.

“State Farm remains committed to helping customers recover after storms, providing access to insurance, and working constructively with the regulator to benefit Oklahoma consumers.”Oklahoma has faced a series of damaging storms and tornadoes in recent years.Experts fear that tornado alley is shifting east and threatening new parts of the state.Drummond says the company’s internal program, the Hail Focus Initiative, started changing the rules in 2020 as it examined wind and hail claims.

The insurer, the suit states, denied or minimized legitimate insurance claims using hidden “restrictive, extra-contractual standards.”The AG said he wants to enforce consumer protection and anti-racketeering laws.He’s also seeking undetermined civil penalties and to compel the company to pay out restitution.The company is the largest homeowners insurance provider in the state.

It has about 300 local agents there and provides abo...