State Farm has agreed to a $2.09 million settlement to resolve a class action lawsuit claiming the insurer underpaid Washington policyholders by excluding “diminished value” payments for certain vehicle repairs. The settlement benefits individuals whose vehicle repairs were covered under State Farm’s underinsured motorist property damage provision between March 23, 2012, and Feb. 13, 2024.
The lawsuit alleged State Farm failed to fully compensate policyholders for diminished value, a legal concept under Washington law that requires insurers to cover losses when a vehicle cannot be repaired to its pre-accident condition. Plaintiffs argued that State Farm did not account for this when covering vehicle repairs after accidents that involved structural damage, deformed sheet metal or significant body and paint work.
State Farm has not admitted any wrongdoing but agreed to the settlement to resolve the claims.
Class members eligible for the settlement include individuals whose vehicles were repaired under the underinsured motorist property damage policy provision, where the repair estimate exceeded $1,000, the vehicle was no more than 6 years old, had fewer than 90,000 miles and suffered significant damage. Eligible claimants can expect payments of around $550, though the exact amount will depend on the number of claims filed and the details of repair costs.
To receive a settlement payment, eligible policyholders must submit a valid claim form by Nov. 12.
The deadline for exclusion or objection to the settlement was Aug. 28, and a final approval hearing took place on Sept. 27.
Claimants can find more information about the settlement and submit their forms online before the deadline.
