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Deadline nears for Farmers Insurance Class-Action award
Posted: Monday, November 29, 2004 3:06 PM
Eligible motorists and health care providers have until Monday
December 6th to claim a share in a $9.5 million jury verdict against Farmers
Insurance. The verdict against Farmers was returned in a class action lawsuit in
Multnomah County Circuit Court on December 5, 2003.
Class
members, those eligible for a share of the jury award, include people who were
injured in a motor vehicle accident between January 26, 1998 and July 31, 1999
and had a claim with Farmers Insurance. Also eligible for a share of the award
are the doctors and medical clinics that treated the injured individuals. All
claims must be postmarked no later than December 6, 2004.
If you
submitted a claim for a motor vehicle accident to Farmers during 1998 and want
to claim your share of the money, you are asked to call 800-245-5097. A claim
form can be obtained by going to the web page http://www.farmerspipclaims.com/. Almost 9,000 claim forms were
mailed out on August 4, 2004 to all known class members and their healthcare
providers. More than 3,000 claimants have responded to date, with more
responding daily to meet the deadline.
Qualified individuals and
health care providers will be compensated for the benefits Farmers did not pay.
In addition, individual drivers and passengers who are class members may share
in additional damages. A share of these damages could be $207 or more per
person.
Jurors in the case Strawn v. Farmers Insurance Co. found
that Farmers acted in bad faith and had been systematically defrauding its
policyholders by failing to reimburse its customers for the full amount of their
reasonable medical expenses following an auto accident. Oregon motor vehicles
insurance law requires insurance companies pay “all reasonable medical
expenses.” Between 1998 and mid-1999, Farmers used a statistical formula that
reduced payments to healthcare providers for any amount over what Farmers
asserted was reasonable.
“The amounts the company was taking from
individual consumers were so small that it was never enough for one person to
pursue,” said Rick Yugler, who tried the case against Farmers. “Of course, all
these small amounts added up to over a million dollars in profits for the
insurance company.” The class includes 7,200 injured motorists and over 1,500
Oregon doctors, chiropractors, therapists and hospitals who may be entitled to
share in the verdict.
The original claimant was Mark Strawn, who
was injured in a car wreck in 1997. His insurance company, Farmers, paid over
$17,000 of his medical expenses except for $427. When Yugler investigated on
behalf of Strawn, he discovered Farmers' deliberate system of cutting
reimbursements. The system was never disclosed in the insurance policy. Farmers
changed its practice in 1999.
FACT SHEET
Class Action
Awards from Strawn v. Farmers Insurance Co.
Claim deadline
All claims for compensation must postmarked no later than December 6,
2004. You may obtain a copy of a Statement of Claim Form by logging onto http://www.farmerspipclaims.com/ or calling Strawn Claims
Administration 800-245-5097. Statement of Claim forms must be sent to PO Box
3560, Portland OR 97208-3560.
Eligible class members
Class
members include any person who made a personal injury (“PIP”) claim with Farmers
Insurance Company of Oregon, Mid-Century Insurance Company or Truck Insurance
Exchange whose claim payment was reduced between January 26, 1998 and July 31,
1999.
Payments
Class members and their healthcare
providers with approved claims will be reimbursed for the reduction in their
benefits, plus interest.
Additional payments
Class members
– injured drivers and passengers – will share in the $8,000,000 punitive damages
award. Health care providers are not eligible for these payments. Each share is
estimated to be $207 per person, but could be more depending on the number of
class members who come forward by December
6.
Background
On December 5, 2003, jurors in the Multnomah
County Circuit Court class action lawsuit Strawn v. Farmers Insurance Co. found
that Farmers acted in bad faith and had been systematically defrauding its
policyholders by failing to reimburse its customers for the full amount of their
reasonable medical expenses following an auto accident. The jury awarded
$1,500,000 in compensatory damages and prejudgment interest, and $8,000,000 in
punitive damages.
Oregon motor vehicles insurance law requires
insurance companies pay “all reasonable medical expenses.” Between 1998 and
mid-1999, Farmers used a statistical formula that reduced payments to healthcare
providers for any amount over what Farmers asserted was reasonable. The amounts
due individual consumers were generally too small to prompt
action.
The original claimant against Farmers Insurance was Mark
Strawn, who was injured in a car wreck in 1997. Farmers, his carrier, paid over
$17,000 of his medical expenses except for $427. When Strawn’s attorney
investigated on behalf of Strawn, he discovered Farmers' deliberate system of
cutting reimbursements. The attorney, Richard Yugler of the Portland firm Landye
Bennett Blumstein, filed the class action on behalf of the 7,200 injured
motorists and over 1,500 Oregon doctors, chiropractors, therapists and hospitals
who were affected by Farmers action.
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