By Barbara Hoberock, Oklahoma Voice
OKLAHOMA CITY – Oklahoma Attorney General Gentner Drummond on Wednesday sued State Farm, alleging the insurance company fraudulently failed to properly pay homeowners for roof damage.
The lawsuit accuses State Farm of misrepresentations and deceptive practices in selling and renewing insurance policies. It alleges the company fraudulently denied or underpaid claims and engaged in racketeering since 2020.
“The allegations describe a corporate scheme that threatens the integrity of Oklahoma’s insurance market place and undermines public confidence in an industry families rely on when disaster strikes,” Drummond said.
State Farm did not respond to a request for comment as of publication Wednesday.
The suit was filed in Cleveland County District Court a day after the state’s high court ruled that Drummond’s office could not intervene in a different case filed in Oklahoma County. In that case, a State Farm policyholder, who lives in Broken Arrow, is challenging the amount the insurer offered to repair damage to their dwelling.
State Farm opposed Drummond’s effort to intervene, saying it would enlarge and alter the original issues in the cases. The Oklahoma Supreme Court agreed.
Drummond’s suit accuses the company of violating the Oklahoma Consumer Protection Act, the Oklahoma Racketeer-Influenced and Corrupt Organization Act, civil conspiracy and unjust enrichment.
The lawsuit alleges that policyholders sustained economic harm, including unpaid benefits and property damage.
“The injuries alleged are not confined to a handful of private disputes: they are widespread, market-wide harms that individual lawsuits cannot adequately address,” the suit said.
The suit alleges State Farm’s conduct is ongoing and will continue without judicial intervention.
“State Farm collected and retained substantial premiums from homeowners insurance policies marketed as providing full replacement cost coverage for hail and wind damage, while internally intending to restrict or deny such coverage and thereafter wrongfully denying or underpaying valid claims,” the suit said.
The suit seeks a permanent injunction to bar it and its agents from unlawful practices.
It also seeks orders to dismantle the racketeering enterprise and prevent its re-occurrence and restitution for the public harm, disgorgement of the company’s “ill-gotten gains,” and other penalties and damages.
