During the second week in September Robert Walker, a U.S. magistrate judge in the Southern District of Mississippi, ruled that hundreds of policyholders in the state who dispute Allstate’s treatment of their Hurricane Katrina claims must file separate lawsuits because the storm affected each homeowner differently.  Walker noted that each plaintiff had basically the same standard policy and that the hurricane was a common occurrence but said that since each insurance contract is a separate transaction, the policyholders must pursue lawsuits against the insurance company individually.

The judge’s decision is seen as the second recent court ruling favoring the insurance industry.  In August L.T. Senter, a senior judge in a U.S. District Court in the Southern District of Mississippi, denied class-action certification to a group of policyholders pursuing lawsuits against State Farm Fire & Casualty Co.  In his ruling Walker said that the specific geographic location of each home resulted in the storm having a vastly different effect.  Michael Trevino, a spokesman for Allstate, expressed satisfaction with the ruling, noting that it upheld the company’s approach of settling claims based on the individual situation.

Katrina Ruling Favors Allstate (Chicago Tribune 9/12/06)

September 14, 2006