Life Insurance Quote Overview

A multistate agreement with State Farm Mutual Insurance Company will result in $40 million in compensation to thousands of vehicle owners nationwide, New York Attorney General Eliot Spitzer announced.

The agreement resolves a problem with the required record-keeping on vehicles damaged by accidents or theft. Specifically, State Farm, after an internal review, determined that in some cases it had failed to comply with the legal requirement that the company "brand" the title of a vehicle that the company acquired following an accident in which the vehicle is totaled.

The company is now reviewing its records. After titling research is completed, an estimated 30,000 consumers nationwide and 200 to 300 in New York may be eligible for payments ranging from $400 to $10,000, depending primarily on the current average value of their vehicle and the number of consumers who participate in the compensation program.

It is estimated that most payments will range from $800 to $1,850. Compensation payments will go to the current owners of vehicles that may require branded titles.

In addition to the $40 million in compensation for consumers, State Farm also will pay the expense of identifying the vehicles, tracing the current owners, contacting owners, and taking claims from owners. State Farm also agreed to modify business practices to ensure title branding problems do not occur in the future.

Under the agreement, State Farm will work with state motor vehicle departments to determine the specific vehicles that require a branded title. After the identification process is completed, Spitzer said it is expected that current owners of eligible vehicles will be contacted by their home state attorney general's office by the Fall of 2005. Consumers who complete a claim form and are approved should receive payment from State Farm later this year or in early 2006.

State Farm also is making a payment of $1 million to all of the state participants for consumer education, future consumer litigation, public protection, local consumer aid funds, and attorney fees and costs.

Referred from: (http://www.consumeraffairs.com)