[StBernard] Miss. homeowner says State Farm coerced him into statement supporting company

[Westley Annis]

10/23/2006, 8:51 p.m. CT 
 
By MICHAEL KUNZELMAN 
 
The Associated Press
 
 	 	
BILOXI, Miss. (AP) - A Gulf Coast homeowner claims State Farm Fire &
Casualty Co. coerced him into signing a statement that he is satisfied with
its handling of his claim after Hurricane Katrina, even though it only paid
for a fraction of the damage to his home.
 
In a lawsuit filed Monday in federal court, Thomas McIntosh of Biloxi claims
State Farm obtained his "false and fraudulently induced 'statement'" in an
attempt to quash media reports about the company's handling of claims
following last year's hurricane.
State Farm only paid McIntosh and his wife $36,228 for their claim, citing
an engineering report that blamed Katrina's storm surge for most of the more
than $1 million in damage to his home.
 
However, McIntosh says the Bloomington, Ill.-based insurer never told him
that State Farm's engineers initially concluded that wind, not water, was
responsible for most of the storm damage. 
 
Hundreds of policyholders on Mississippi's Gulf Coast are suing State Farm
and other insurance companies for refusing to cover billions of dollars in
damage from Katrina's rising water, including wind-driven storm surge.
 
State Farm spokesman Phil Supple said McIntosh's allegations are "absolutely
contrary to the way we do business."
 
"We dispute these characterizations of our behavior," he said. "We have
worked hard and long to help a lot of Mississippians."
 
McIntosh, who met with State Farm attorneys in August, says he didn't
understand the implications of the conflicting engineering reports when he
agreed to sign a statement that he was "satisfied that (my) adjustment and
payment under the State Farm policies was done correctly."
 
State Farm later sent that statement to media outlets, including The
Associated Press, that were preparing reports about allegations that the
company pressured engineers to alter reports so it could deny claims by
McIntosh and other policyholders.
 
McIntosh says he learned about the conflicting reports from Mississippi
Attorney General Jim Hood's office, which is investigating allegations that
State Farm and other insurers fraudulently denied claims after Katrina.
 
Zach Scruggs, one of McIntosh's attorneys, said his client signed the
statement because he worried that State Farm would cancel his insurance
coverage if he didn't cooperate.
 
"It was certainly an intimidating atmosphere for anybody," Scruggs said of
McIntosh's meeting with State Farm attorneys. The company arranged that
meeting several days after an ABC News reporter questioned a State Farm
attorney about the conflicting reports for McIntosh's property.
 
Supple, who said State Farm hasn't seen McIntosh's lawsuit, has rejected the
allegation that the insurer pressured engineers to change their reports.
"For the small percentage of claims that are headed to court," he said, "we
will look for ways to resolve these disputes while at the same time
defending the honorable actions of State Farm and its employees."
 
Forensic Analysis and Engineering Corp., the Raleigh, N.C.-based firm
accused of issuing conflicting reports for McIntosh's claim, also is named
as a defendant in his lawsuit.
 
McIntosh's attorneys say they obtained reams of internal State Farm records
from "whistleblowers" Cori and Kerri Rigsby, sisters who worked for a
company that contracted with State Farm.
 
One of those documents was a note attached to McIntosh's initial engineering
report that read, "Put in Wind file - DO NOT Pay Bill DO NOT Discuss,"
according to the lawsuit.