Oklahoma Attorney General Gentner Drummond has filed a lawsuit against insurance company State Farm, alleging a "corporate scheme" designed to systematically deny or minimize homeowner claims for wind and hail damage. The suit, filed in Cleveland County District Court, contends that State Farm implemented an internal program to reduce claim payments to Oklahomans, despite rising insurance premiums.
Drummond stated that the company's "Hail Focus Initiative," established in 2020, began applying "hidden, restrictive, extra-contractual standards" to evaluate wind and hail claims. He asserts that these practices undermine public confidence in the insurance industry and threaten the integrity of Oklahoma's insurance marketplace. The Attorney General is seeking to enforce consumer protection and anti-racketeering laws, pursuing undetermined civil penalties and restitution for affected policyholders.
State Farm, the largest homeowners insurance provider in Oklahoma with approximately 540,000 residential and commercial policies, denied the allegations. A company statement provided to Realtor.com called Drummond's claims "politically motivated" and countered that State Farm has paid $1 billion to Oklahoma customers for wind and hail damage. The insurer maintained that it fairly evaluates every claim based on the facts and purchased coverage. "Unfortunately, the continued focus on these allegations appears driven more by political motivations than by the facts or the needs of Oklahoma consumers," the company said.
Oklahoma has experienced numerous severe storms and tornadoes in recent years, leading to concerns that Tornado Alley may be shifting eastward. Drummond highlighted the disparity between increasing premiums paid by Oklahomans and the decreasing level of protection received, suggesting that inflation and weather patterns do not fully account for this gap.
This lawsuit follows an earlier attempt by Drummond to intervene in an individual homeowner's suit against State Farm, which also alleged claim denials and premium increases. The Oklahoma Supreme Court denied the Attorney General's request to intervene on Tuesday, directing the state to pursue its case in a different venue. State Farm expressed satisfaction with the court's decision.