Farmers Group

A class action lawsuit has been filed in Oklahoma against Farmers Insurance Companies Inc., for using credit information in insurance ratings.

According to court documents, the plaintiffs are suing “Farmers Insurance Company Inc., Farmers Group Inc., Farmers Insurance Exchange, Fire Underwriters Assoc., Fire Insurance Exchange and Mid-Century Insurance Company, seeking to recover statutory damages, costs and attorneys’ fees based upon defendants’ alleged willful violations of the Fair Credit Reporting Act” (FCRA).

The plaintiffs claim that Farmers companies’ use consumer report information on their applicants and insured’s and “took adverse action against each plaintiff and each class member, based in whole or in part on information obtained in consumer reports, but did not provide adequate notice of the adverse action to each plaintiff and each class member as required by the FCRA,” according to the judge’s published opinion. The plaintiffs further allege that the companies’ failure to provide adequate notice was “willful and deliberate.”

Class certification was sought for all who received, renewed and/or purchased personal auto and/or homeowners policies from the named companies and “were charged more than the lowest premium available for such insurance” based on credit history contained in the consumer report.

The judge rejected several of Farmers’ arguments against granting class action status, including the companies’ contention that oral notice of adverse action given by their appointed representatives was sufficient. Court documents showed that the defendants claimed “their independent insurance agents had a regular business practice of providing oral notice of adverse action to their customers. Defendants assert that the insurance agents routinely informed their customers that credit information was used in determining premiums and also informed their customers if they did not receive the best premium discount based in part on their credit information.”

The judge rejected the companies’ argument for various reasons, including the fact that “evidence before the court does not reveal that the named plaintiffs or the class members received oral notice of adverse action during the time period when defendants utilized the three adverse action notice forms” that are central to the class definition.

The court noted that its certification decision may be “altered or amended” at a later date “should circumstance warrant.”

This entry was posted on Wednesday, October 10th, 2007 at 7:18 pm and is filed under Farmers Group. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

3 Responses to “Farmers Group”

  1. Sandra Gardner Says:

    On January 28, 2011, I was served with a notice from Farmers Insurance Company, Foremost, informing me that because of my credit rating (which as of January 29, 2011, I went bancrupt); that as of March 31, 2011 I woulc be permanently cancelled because of my credit rating. This appears to be an illegal practice according to this particular class action. Please inform me of my rights immediately. I have used Farmers/Formost Insurance for the past two (2) years. My home address is 1405 90th Place North Birmingham, Alabama 35206.

  2. Deanne McCollum Says:

    We had a sudden leak of water damaging walls and floors. Farmers settled this claim for $29.00 and we filed suit ending in a settlement for bad faith practices on behalf of Farmers.
    Our monthly bill covering household content and vehicle went up every month for many months. Upon asking the local agent why our rates were going up, we were told so “Farmers can recoup the loss from the lawsuit ” that we had filed. I would love to see the company go out of buisness. In a time when the econmy is so bad, it’s too expensive to eat AND pay Ins.

  3. Sherry Roubidoux Says:

    I expected a decrease this year on my homeowners policy but that did not happen. I was told it was because Farmers had an across the board rate increase. If this is true, what is reason for the increase? Or is it because we are paying for this lawsuit?


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