Judge boosts State Farm verdict
MARION, Ill. — A damage award to State Farm auto insurance customers swelled to nearly $1.2 billion Friday after a judge ruled the nation’s largest auto insurer committed fraud by its use of generic replacement parts in auto-body repairs.
Friday’s $730 million award of actual and punitive damages came on top of a jury’s $456 million verdict Monday in the same class-action lawsuit. The initial award already was believed to be the largest ever against an insurer.
At issue is the use of “aftermarket” auto parts — modeled on those made by the manufacturer but made without access to factory specifications — to repair the cars of State Critics say aftermarket parts aren’t as good as those made for automakers. The lawsuit accused State Farm executives of concealing that information while flooding customers with brochures promoting the parts as a high-quality, low-cost alternative.
The jury’s award to 4.7 million State Farm policyholders was based on a claim the insurer breached its contract with customers by failing to restore their cars to their pre-accident condition