Friday, February 12, 2010

Texas Farmers Insurance Homeowners Class Action Lawsuit

Pursuant to the order of the 172nd District Court of Jefferson County Texas this press release is being issued to inform interested parties that a Class has been certified and is pending awaiting trial in the matter: Sandra Geter, on behalf of herself and all others similarly situated v. Farmers Group, Inc.; Farmers Underwriters Association; Fire Underwriters Association; Farmers Insurance
Exchange; and Fire Insurance Exchange, Cause No. E-167,872), In the District Court of Jefferson County Texas, 172nd Judicial District. The following copy of the Notice ordered by the Court provides further information.

Para una traduccion en espanol de esta notificacion por favor llame al 1-877-695-7479

V. |

Legal Notice
A Pending Class Action Lawsuit May Affect Your Legal Rights

If your HO-B homeowners insurance was not renewed in the circumstances described below, you are hereby put on notice that a class action lawsuit has been certified and is now pending in the 172nd Judicial District Court, Jefferson County, Texas (the "Court"). The lawsuit is entitled Sandra Geter, on behalf of herself and all others similarly situated, (the "Plaintiffs") v. Farmers Group, Inc., Farmers Underwriters Association, Fire Underwriters Association, Farmers Insurance Exchange, and Fire Insurance Exchange, (the "Defendants"), Cause No. E-167,872, 172nd District Court, Jefferson County, Texas (the "Lawsuit").

This Notice affects you if you fit within the following class (the "Geter Class"):

All persons, other than those excluded below, whom, on or after November 14, 2001, received a notice from one or more Defendants advising them that their current HO-B homeowner policy covering property in the State of Texas would not be renewed when it expired.

The persons excluded from the Geter Class are:

(a) All persons who received a notice from one or more Defendants on or
after November 14, 2001, advising them that their current HO-B
policy covering property in the State of Texas would not be renewed
because the person receiving the notice had filed three or more
claims under the policy in the preceding three years and the claims
did not result from natural causes;
(b) All persons who received a notice from one or more Defendants on or
after November 14, 2001 advising them that their current HO-B
policy covering property in the State of Texas would not be renewed
because the person receiving the notice had filed two non-weather
related claims in a period of less than three years, had received a
notice that their policy would be subject to non-renewal if a
third non-weather related claim was filed during a three year
period beginning with the date of the first of the two non-weather
related claims, and who filed a third non- weather related claim
during the said three year period;
(c) All government entities, bodies and agencies of any character,
federal state or local and their employees (in that capacity only);
(d) The presiding judge(s) and other court personnel; and
(e) The Defendants and their employees and agents.

The Court has ordered that the Geter Class be provided notice as follows:

1. Plaintiffs contend that despite Defendants' notice of non-renewal,
Geter Class members are entitled to renew their HO-B homeowner's
insurance policy and Plaintiff seeks a declaratory judgment
establishing whether and on what terms the Geter Class has a right
to renew the HO-B coverage. Defendants have denied any wrongdoing,
have denied that the Geter Class is entitled to renewal of the
coverage or the requested declaration, and Defendants contend that
they were not required to offer HO-B homeowners insurance policies
to Texas policyholders. The Texas Commissioner of Insurance has
agreed that Texas law permits Farmers to discontinue, as it has
done, offering HO-B policies to Texas policyholders, and offer, in
lieu of the HO-B policy, its amended and revised HO-A policy. This
Notice is not to be construed as an expression of any opinion by the
Court with respect to the merits of the respective claims or
defenses. This Notice is sent merely to advise you of the pendency
of the action and the rights which you have with respect to the

2. All Geter Class members are also members of another class in the
pending case of Jan Lubin, et al v. Farmers Group, Inc. et al., C.A.
No. GV202501, in the 261st District Court in Travis County, Texas.
In particular, Geter Class members are members of the Rate class in
Lubin ("Lubin Class"), which includes all "who received a notice at
any time after November 14, 2001, that their HO-B Policy would not
be renewed." Farmers has agreed with the Texas Attorney General, to
settle the Lubin matter. The settlement must still be approved by
the trial court in Lubin. Under the proposed settlement, Lubin Rate
Class Members are eligible for a 6.8 % refund of earned base
premiums paid on HO-A policies incepted or renewed from December
28, 2001, up to and including November 10, 2002, either in the form
of a refund check or a credit upon renewal after approval of the
settlement. The Lubin Rate Class received a reduction to any HO-A
policy that was renewed or to any new policy issued, and the
reduction also is to be applied retrospectively to HO-A policies
issued before December 18, 2002. The proposed settlement with the
Lubin Class also provides other benefits to members of the Geter
Class. Some policyholders may receive benefits as members of the
Lubin Discount Class if they are current or former HO-A
policyholders and former HO-B policyholders who paid premiums that
were higher than what they would have been charged had the agreed
upon individual discounts been applied. Lubin Discount Class members
who did not receive discounts for Farmers Property Risk Assessment,
age of home, and territory at the level agreed to by the State and
the Farmers Parties are eligible to receive an Individual Discount
Adjustment payment. In addition, Geter Class members may be entitled
to recover in Lubin from the Credit Usage Notice Adjustment Fund if
Farmers used incorrect credit information when calculating their HO-
B premiums. Lubin Credit Usage Notice Class Members are eligible to
make a claim against the Lubin Credit Usage Notice Adjustment Fund,
designed to reimburse those policyholders who paid a higher premium
for auto or homeowners insurance due to erroneous credit information
on the individual's credit history maintained at a credit bureau,
which led Farmers to charge higher premiums than they would have
charged with correct credit information.

3. The settlement in Lubin has been preliminarily approved by the
District Court in Travis County. If you want to participate in the
final fairness hearing in Lubin, you must be a member of the Lubin
Class. The procedure for participation in the Lubin hearing will be
sent to you separately in another notice.

4. Any member of the Geter Class may opt out of the Geter Class and thus
be excluded from the litigation and remain eligible to participate
in the Lubin settlement. To opt out a Geter Class member need only
send their name and address in writing along with a statement that
they wish to opt out of the Geter Class to: Tom Kiehnhoff, Reaud,
Morgan & Quinn, 801 Laurel St., Beaumont, Texas 77701 with a copy to
Layne E. Kruse, Fulbright & Jaworski LLP, Fulbright Tower, 1301
McKinney, Suite 5100, Houston, TX 77010-3095. The opt out request
must be postmarked by May 1, 2010. Persons who opt out will not be
entitled to share in the benefits of the judgment if it is favorable
to Plaintiff and the Geter Class, and will not be bound by the
judgment if it is adverse to Plaintiff and the Geter Class.

5. All Geter Class members who do not opt out as described in Paragraph
4, will be bound by the determination of the Court whether favorable
or unfavorable to the Geter Class. Geter Class members are advised
that only the claim for declaratory relief has been certified as a
Geter Class claim and only the claim for declaratory relief will be
tried in Geter. Geter Class members are warned that claims for
damages or any other relief not within the scope of the declaratory
relief certified will not be tried as Geter Class claims and there
is a real and substantial danger that such claims may later be found
to be barred by a judgment for or against the Geter Class, unless
the Geter Class member opts out.

6. If Geter prevails in this case, to renew HO-B coverage, Defendants
contend that each Geter Class member must pay the full cost of the
renewed HO-B policies for each year in issue, or from the year of
non- renewal (in most instances from 2002) to date. For example,
the premium for a HO-B policy in 2002 has been estimated to be in
excess of $5,410.00 for Sandra Geter, or total premiums of about
$43,280.00 for the years 2002-2009. In 2003, the Texas Legislature
passed legislation regulating rates. Each insurance exchange is
required to use certain criteria in setting rates and must file
proposed rates with the Texas Insurance Commissioner. Exchanges are
not currently permitted to write homeowners insurance on the HO-B
form - or any other policy form - without first undergoing this
rate-making process. Because new rates would have to be filed with
the Texas Commissioner of Insurance for approval under the new law,
the exact amount each Geter Class member would be required to pay to
obtain an HO-B policy renewal is unascertainable at present.

7. Since the Geter case was filed in 2002, the Texas Supreme Court has
ruled that the HO-B policy excludes mold damage claims. Therefore,
any renewal of an HO-B policy offered to Geter Class members as a
result of this case would not include coverage for losses caused by

8. If Geter prevails in this case, to renew a HO-B policy, Defendants
contend that each member of the Geter Class would also be required
to qualify for the coverage. In addition to submitting proof of
ownership of the insured property, the renewal of each Geter Class
member's HO-B policy would be subject to underwriting review.
Underwriting is the process used by an insurer to determine if a
risk is acceptable to the insurer, and if so, how to price that risk
if written. An underwriting review may include, among other things,
the inspecting of the insured's home (both interior and exterior) to
determine whether it continues to meet underwriting requirements.
The underwriting inspection may include an inspection of the home's
roof, foundation, sidings, doors, windows, driveways, porches,
decks, patios, gutter, plumbing, heating, cooling systems,
electrical, and the maintenance and other physical condition of the
property. If a property does not meet the actuarially sound
underwriting guidelines, Defendants cannot be required to renew it
without regard to whether Geter prevails in this matter.

9. Any Geter Class member may, if they choose and at their own expense,
enter an appearance through counsel of their choosing. All Geter
Class members who do not opt out or enter an appearance through
counsel of their choosing will be represented by Plaintiff through
her counsel:

Glenn W. Morgan
Tom N. Kiehnhoff
Chris Portner
Reaud, Morgan & Quinn
801 Laurel Street
Beaumont, TX 77701
(409) 838-1000

Wayne A. Reaud
The Reaud Law Firm
801 Laurel Street
Beaumont, TX 77701
(409) 838-1000

L. DeWayne Layfield
Law Office of L. DeWayne Layfield
P.O. Box 3829
Beaumont, TX 77704
(409) 832-1891

10. The attorneys representing the Geter Class have entered an employment
contract with Sandra Geter under which Sandra Geter agreed that
should she prevail in this case the attorneys would receive a
contingent fee payment. However, since no damages will be recovered
in this Lawsuit by the Geter Class, the attorneys representing the
Geter Class plan to apply for reasonable and necessary fees based on
the hours that they actually worked on this matter, assuming the
Geter Class prevails at trial. If awarded by the Court, reasonable
and necessary fees would be paid by Defendants.

11. All communications and questions concerning this Notice should be
sent to Plaintiff's attorneys identified in Paragraph 4, and should
not be addressed to the clerk of this Court.

12. If the address of any Geter Class member changes or is different than
the address stated on the envelope enclosing this Notice, the new or
corrected address information should be sent by mail to the
attorneys identified in Paragraph 4.

13. This Court has retained jurisdiction in this action to alter, amend
or withdraw its order determining that this cause shall be
maintained as a class action, at any time before final judgment.

14. The pleadings and other papers filed in this action are available for
inspection in the office of the clerk of this Court.

15. You can also obtain additional information by visiting or calling toll free 1-877-695-7479.

Dated: December 10, 2009 /s/ Donald J. Floyd
Honorable Donald J. Floyd
Judge 172nd District Court
Jefferson County, Texas

Media inquiries can be made as indicated in the Notice.


Labels: , , , , , , , ,


Post a Comment

<< Home