🏥 State Farm Alabama Total-Loss Purchasing Fees Settlement

State Farm allegedly failed to include sales tax and other required purchasing fees when paying Alabama first-party auto total-loss claims.

State Farm Alabama auto policyholders who submitted a covered first-party private passenger auto physical-damage claim between Nov. 7, 2018 and Feb. 10, 2026 that resulted in a total-loss payment without full purchasing fees.

$20.50 flat cash payment per valid claim

2026-07-15

The case stems from a lawsuit filed in the Circuit Court of Montgomery County, Alabama — Dortch v. State Farm Mutual Automobile Insurance Company — alleging the insurer left specific charges, including a 2% Alabama sales tax plus county sales tax, ad valorem taxes, and title/tag fees, out of total-loss payouts. Rather than a single shared settlement pool, State Farm agreed to pay each valid claimant a flat $20.50 per claim, with any court-approved attorney fees (up to $261,200) and a $5,000 award to the named plaintiff paid separately so they don't reduce what class members receive. State Farm denies any fault, wrongdoing, or liability in the matter. The court held a final approval hearing on June 15, 2026, preceded by an objection/exclusion deadline of May 15, 2026.