Drummond sues Allstate, alleges insurer defrauded Oklahoma customers

OKLAHOMA CITY (KFOR) — Oklahoma Attorney General Gentner Drummond filed a lawsuit Tuesday against Allstate, alleging the insurance company knowingly and systematically ripped off Oklahoma customers.

The lawsuit marks the second major insurance company Drummond has sued over allegations it systematically underpaid Oklahoma homeowners for storm damage.

"They failed to operate with good faith and fair dealing," Drummond said. "And they are being held accountable. It boils down to this. Allstate made representations to consumers in Oklahoma and defrauded them."

Drummond's lawsuit, filed Tuesday, claims Allstate promised Oklahoma customers full coverage to replace storm-damaged roofs, then quietly used its own hidden rules to shrink or deny those claims—and brought in its own engineering reports specifically designed to back up the denials.

"Many Oklahomans have lost significant funds from the deceptive practices of Allstate," Drummond said.

If it sounds familiar, it's because Drummond is also suing State Farm, alleging the company, too, systematically denied and underpaid legitimate hail and wind damage claims for Oklahoma customers.

"The objective is effectively, let's charge more and pay less," Drummond said. "So Allstate is guilty of prioritizing corporate profits over protecting the consumer. They have a contractual duty to Oklahoma to treat them fairly and in good faith."

News 4 asked Drummond why he believes multiple insurance companies felt like they could get away with those practices.

"Greed. Greed," Drummond said. "Let's think about it. If I can institute this policy and make $1,000,000,000 over a ten-year period from Oklahoma and get sued a hundred times and settle for $100,000 each. They win, right? Allstate made a lot of money off of Oklahoma."

News 4 then asked Drummond what the odds are that Allstate and State Farm are the only two companies using similar practices.

"I would say it's low. Low," Drummond said.

Drummond said data shows, on the whole, insurance companies are charging Oklahomans much more than customers in similar states for the same services.

"The weather patterns of Oklahoma are very similar to Kansas, Missouri, Arkansas," Drummond said. "Right. And yet those citizens are paying almost one half their policy amount than Oklahoma."

News 4 asked Drummond what it is about Oklahoma he believes makes insurance companies think they can get away with those practices.

"I think it's systemic," Drummond said. "I think that we need to have as a matter of fact, I've made a demand of the insurance commissioner to conduct a hearing on the competitive nature of the Oklahoma insurance markets. We have three experts ready to testify. As soon as Commissioner Mulready sets the hearing date, he has to give me ten-day notice. He said will delay that until after the runoff. Fine."

News 4 also asked Drummond whether filing the lawsuit during his runoff election for governor was an attempt to score political points.

"Absolutely no," Drummond said. "We have a job. I take seriously my role as attorney general, and that is to protect consumers. We began the investigation of this company months ago, and we've reached the conclusion that we have sufficient evidence to proceed with an action."

Drummond said if you feel Allstate or any insurance company has wrongfully denied your claim, you can file a complaint on the Attorney General's Office's website.

So far, Allstate has not filed a response to Drummond's lawsuit.

News 4 reached out to Allstate Tuesday afternoon.

"This lawsuit has no merit and serves Billboard Lawyers who turn routine insurance claims into lawsuits, making insurance more expensive for everyone. Allstate is committed to supporting customers with timely and fair claim payments based on their policy to help them recover from storms." said Allstate.