State District Judge Scott Jenkins in Austin gave a nod to the $117.5 million settlement between the state of Texas and Farmers Insurance Group. According to the Austin American-Statesman, the preliminary approval ends a long legal process involving claims that Farmers overcharged its homeowners customers unfairly and discriminatorily.
Farmers policyholders, as many as 700,000, could begin receiving notices explaining the settlement as early as next month.
Under the settlement, Farmers must cut its base rates by 6.8 percent and provide refunds and credits to policyholders for certain types of overcharges. Farmers will also be required to change some its rating and underwriting practices.
The company has admitted no wrongdoing in the case and is not required to do so under the agreement.
Plaintiff attorneys challenged the case, saying policyholders were not adequately represented in the proceedings and that the state conceded too much to Farmers in the settlement.
Jenkins, however, rejected those arguments and others, including the notion that Farmers received a “sweetheart deal” from the state.
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