The Tennessee Ruling’s Impact
Big news for Tennessee policyholders. Late last week, the Sixth Circuit Court of Appeals gave the green light for a massive class-action lawsuit against State Farm to move forward. We’re talking about 90,000 individuals banding together to challenge how State Farm calculated insurance payouts for totaled vehicles. The case? Heading straight for the Western District of Tennessee courthouse in Memphis.
This is a big deal. Why? Because this case could set a precedent for how car insurance claims are handled across the state—not to mention the financial implications for State Farm.
What’s the State Farm Lawsuit About?
It all comes down to one thing. Money. Specifically, how much State Farm was paying for totaled cars. The suit claims that the insurance giant used a flawed valuation method provided by a third-party company, Audate
x. Here’s the sticking point. At the heart of the controversy is something called a “Typical Negotiation Adjustment.” Sounds bureaucratic, right?
The plaintiffs argue this adjustment unfairly reduced the payouts policyholders received for their vehicles. The alleged average reduction? 8.5%. Policyholders say that’s no small change. The suit digs deeper, claiming the adjustment is arbitrary, unsupported, and doesn’t reflect how real-world car sales actually work…