December 15, 2005 by Canadian Underwriter
State Farm Insurance has announced it is issuing refunds to approximately 3,800 automobile insurance policyholders in New Brunswick as a result of an error in the application of a New Business Discount that was introduced in 2000.
The average refund is approximately $82.00. The refund applies to customers who were eligible for the New Business Discount credit, but the credit was not applied. State Farm’s New Business Discount Credit constitutes a 5% discount on mandatory and collision coverage premiums.
State Farm announced it has reported its error, as well as its plan to process the refunds to those affected, to the Superintendent of Insurance.
State Farm is among the top six largest property and casualty insurers in Canada. Its 460 Canadian agents currently provide insurance and financial services from mutual funds and life insurance to vehicle loans, home and auto insurance in Ontario, Alberta and New Brunswick.
This is the second time in as many weeks that State Farm has announced a discount related to its New Business Discount. In mid-December, State Farm announced it was issuing refunds to approximately 6,300 automobile insurance policyholders in Alberta as a result of a similar error. The average refund in Alberta is approximately $74.00
“We sincerely regret this error and apologize to those policyholders affected,” State Farm senior vice president Bob Cooke said in a press release.
State Farm customers who are entitled to a refund will receive written notification in December 2005. Any eligible former policyholders who cannot be contacted to receive their refund may contact any State Farm agent.
State Farm will be donating any unclaimed amounts to the United Way.