The commissioner said the report "is a thorough and detailed accounting of what happened with State Farm policyholders after Katrina" and identifies problems for the industry in addressing hurricanes and other natural disasters. He called the report "evenhanded."

Among the report's findings and discussion are:

o Some policyholders' claims were not handled appropriately, although the exam found no specific violations of the Unfair Trade Practices statute.

o The exam found no pattern of violation of the insurance fraud statute, which parallels findings of Attorney General Jim Hood's office.

o Although there were questionable decisions and irregularities by State Farm in handling claims, no scheme or plan to systematically mistreat policyholders was found.

o After numerous complaints and accusations by policyholders, State Farm agreed to reopen all cases involving homes that were wiped off their foundation slab through an insurance department monitored program, which resulted in an additional $88 million dollars being paid to policyholders.

"Hurricane Katrina was an extremely trying situation for everyone involved," said Mr. Chaney. "The real brunt was borne by the people on the coast who lost their homes and businesses. We do not and should not expect insurance companies to pay claims that are not covered by the policy. However, we expect them to promptly pay every penny that policyholders are owed on policies paid in good faith."

He said he would continue to push for policies to be written in plain, simple understandable language. He also is working with carriers to provide a good business environment in Mississippi, while not tolerating unfair treatment of policyholders.

"I'm confident we can use findings of the exam as a constructive tool to help make policyholders' lives easier the next time disaster strikes," he concluded.

In a statement, State Farm said, "This report confirms what we have always maintained--that State Farm settled the vast majority of policyholder claims quickly and satisfactorily despite their enormous volume and complexity. The report clearly shows that examiners found no violations of state law or regulations, allegations of 'fraud and abuse' were baseless, and where mistakes were discovered in claims handling, we corrected them.

The report is available on the department's Web site at: www.mid.state.ms.us.