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January 10, 2005
State Farm Multi-State Agreement will Result in $40 Million to Consumers

TACOMA -- Hundreds of Washington consumers who purchased used cars after June 1, 1997 may be eligible for refunds as the result of a multi-state settlement with State Farm Mutual Insurance Company.

State Farm has agreed to a $40 million nationwide consumer compensation program after it informed state attorneys general that some vehicles the company handled as total losses do not have correct titles. Those vehicles—either salvaged, damaged, rebuilt, reconstructed, or otherwise totaled—should have “branded titles,” indicating the vehicle’s history. State Farm records show as many as 2.4 million vehicles may have required “branded titles.”

An estimated 30,000 consumers nationwide may be eligible for payments ranging from about $400 to $10,000, depending on the current average value of their vehicles and the number of consumers who participate in the program. The states believe most payments are likely to range from $800 to $1850.

Under the agreement, State Farm will work with state departments of motor vehicles in the coming months to determine in each state the specific vehicles which require a branded title. The owners of those vehicles will receive a letter from the Washington Attorney General’s office with a claim form to return to an independent claims administrator company. After all claims are in, the amount each consumer will receive will be finalized and checks mailed later this year or early 2006.

To be eligible for compensation, a consumer must be the registered owner of the vehicle, but not at the time it was declared a total loss. Also, the consumer must have been unaware that their vehicle was dubbed a total loss when they purchased it. The eligibility requirements will be listed in the claim form letter mailed to consumers. Regardless of whether you complete a claim form, State Farm will notify the Washington State Department of Motor Vehicles that your vehicle needs a branded title.

The final amounts received by consumers will be based on the current average retail value of the vehicle. For example, owners of vehicles worth between $1,000 and $2,000 will receive $600; owners of vehicles worth between $5,000 and $6,000 will receive $1,400; owners of vehicles worth between $10,000 and $11,000 will receive $3,000.

State Farm is also paying $1 million to all the state participants for consumer education, future consumer litigation, and attorney fees and costs. Washington will receive $15,000.


For more information contact:
Kristin Alexander, (206) 464-6432,


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