Internal State Farm documents are now public after an Oklahoma judge lifted confidentiality protections in a roof damage lawsuit. The documents have raised questions about how the insurance company reviewed some wind and hail claims.
The lawsuit is taking place in Oklahoma, where Vargas Gonzalez Delombard, LLP does not practice. Still, the issues may be important to property owners in other states who have had a roof claim denied or underpaid.
What Happened to the Home’s Hail Damage Claim?
Neil and Lacy West say their Lawton, Oklahoma, home was hit by two-inch hail in July 2023. According to news reports and court filings, they estimated that the storm caused about $50,000 in damage. State Farm reportedly offered about $5,000 for the claim.
The Wests filed a lawsuit against State Farm. They claim the company did not properly handle their roof damage claim. State Farm disputes the allegations. The legal battle is part of wider litigation over how some wind and hail claims were reviewed.
During the lawsuit, State Farm produced hundreds of thousands of pages of internal records. Many of those records were marked confidential. This meant the public could not see them.
A Comanche County judge recently removed the confidential label from 31 documents. Those records may now be discussed in public. The plaintiffs had asked the court to remove the label as part of efforts by trial lawyers to obtain and review evidence. The case has also included disputes about depositions of company leaders and employees.
Making a document public does not mean that every claim made about it has been proven. The court still must decide the facts and legal issues in the case. Bad faith lawsuits also require courts to examine the specific policy, investigation, and facts involved in each claim.
What Do the State Farm Documents Allegedly Show?
Attorneys for the homeowners say the documents describe a State Farm program for wind and hail claims. News reports have called it the “Hail Focus Initiative.”
According to the homeowners’ attorneys, the records suggest that State Farm:
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Used remote employees or managers to review some roof claims;
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Limited the power of local adjusters to approve full roof replacements;
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Tracked how often adjusters approved or denied roof claims;
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Reviewed adjusters who approved more roof replacements; and
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Measured savings linked to lower claim payments or claims closed without payment.
The plaintiffs allege that these practices affected the claims department and the authority of a local claim handler. They also argue that company oversight may have influenced claim decisions. State Farm disputes the claim that these practices were part of a wrongful scheme.
The attorneys also claim the program began as a test in Dallas County, Texas, in 2020 and later expanded to other areas.
These are allegations made by the homeowners and their attorneys. They have not been finally proven at trial.
How Has State Farm Responded to the Damage Allegations?
State Farm has denied claims that it has a system designed to wrongfully deny or underpay valid roof claims.
The company has said that it reviews each claim based on the facts of the loss, the cause and amount of damage, the condition of the property, and the terms and exclusions in the policy. State Farm has also said it paid more than $1 billion to customers for wind and hail damage in Oklahoma during a recent two-year period.
The lawsuit is still pending. A court will need to review the evidence and decide whether State Farm followed the policy and the law when it handled the Wests’ claim.
What Does the State Farm Lawsuit Say About Coverage?
An insurance company has the right to investigate a claim. It may also deny damage that is not covered by the policy. For example, a policy may not cover damage caused by old age, wear and tear, poor maintenance, or another excluded cause.
However, an insurance company should not make a decision only because it wants to reach a savings goal. A claim should be reviewed based on the policy, the damage, and the available evidence.
Internal documents may help show how a company trained its adjusters, reviewed their decisions, and measured claim results. They may also help a court decide whether a claim was handled fairly. The meaning and legal effect of the newly public records will depend on the evidence and the court’s rulings.
Can Hail Damage Be Covered by Homeowners Insurance?
Homeowners insurance may provide coverage for sudden hail damage, but every claim is different. Coverage depends on the policy language, what caused the damage, the age and condition of the roof, and any exclusions or deductibles that apply.
The type of claim also matters. A homeowners roof claim may involve different policy terms and facts than commercial claims filed by a business or property owner.
An insurance company may decide that part of the damage came from wear and tear instead of hail. It may also disagree about whether the roof needs a full replacement or only repairs. Property owners should read the insurer’s written decision and compare it with the terms of their policy.
Warning Signs After a Roof Damage Claim
One denied or underpaid claim does not prove that an insurance company acted improperly. However, a property owner may want to ask more questions if:
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The insurer says there is no hail or wind damage, but a qualified professional finds storm damage;
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An adjuster recommends repairs or a roof replacement, but that decision is later changed;
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The insurer blames wear and tear without clearly explaining its findings;
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The estimate leaves out damaged areas or needed repairs;
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The insurer relies on photos without completing a careful inspection; or
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The insurer does not explain which policy terms support its decision.
What Can Property Owners Do When Coverage Is Denied or Underpaid?
If your wind or hail claim was denied or underpaid, start by reading the insurer’s letter and your policy. Look for the reason given for the decision and any deadlines that may apply.
You may also want to:
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Save photos and videos of the property before repairs begin.
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Keep copies of estimates, reports, emails, letters, and claim notes.
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Ask the insurer to explain its decision in writing.
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Get an independent inspection when appropriate. A contractor locator offered by a trusted organization may help you begin searching, but you should still review the contractor’s license, insurance, experience, and references.
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Keep damaged materials if it is safe and practical to do so.
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Speak with a property insurance attorney about your options.
Insurance policies and claim deadlines are different in every state. Waiting too long may affect your rights, so it is important to act promptly.
We Help Property Owners With Insurance Coverage Disputes in Six States
Vargas Gonzalez Delombard, LLP does not handle Oklahoma claims. Our attorneys represent property owners with denied, delayed, or underpaid insurance claims in Florida, Texas, Colorado, New York, Illinois, and Missouri.
If your property was damaged by hail, wind, water, fire, or another covered event, we can review the facts and help you understand whether additional insurance benefits may be available under your policy.
Contact Vargas Gonzalez Delombard, LLP to discuss your property insurance claim.
This blog is for general information only and is not legal advice. Past results do not guarantee a similar outcome. The allegations discussed above remain disputed unless and until proven in court. Vargas Gonzalez Delombard, LLP does not practice law in Oklahoma.
