Zurich Insurance Agrees $455M Settlement in Farmers Class Action

London, UK: Zurich Financial Services Group and its subsidiary, Farmers Group Inc, have settled a nationwide class action lawsuit that is pending in Superior Court in Los Angeles. Under the terms of the settlement, $455 million will be made available to up to 13 million policyholders.

The suit alleged that the class, consisting of policyholders who held automobile, homeowners, and umbrella insurance policies issued through Farmers Insurance Exchange, Fire Insurance Exchange, and Truck Insurance Exchange, were being charged excessive AIF fees.

The proposed settlement in the matter of Fogel vs. Farmers Group Inc. will resolve all claims, dating back to 1999, in a complaint originally filed in August 2003.

In addition, as part of the proposed settlement Zurich announced number of initiatives at FGI to further raise standards of customer communication. These include providing welcome packs and additional disclosures to Exchange policyholder subscribers and providing additional training to Farmers agents and front-line employees regarding the subscription agreement and related procedures. The settlement does not affect the insurance coverage for current policyholders.

Terms of the proposed settlement are subject to execution of a formal settlement agreement and court approval.