Green Labor Depreciation Settlement

Frequently Asked Questions

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1. What is this lawsuit about?

The lawsuit claims that American Modern improperly deducted depreciation attributable to costs of labor when adjusting some homeowners’ insurance claims in Arkansas.

American Modern has maintained that it paid claims when reasonable and appropriate to do so and has denied all allegations that it acted wrongfully or unlawfully.

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2. What American Modern companies are part of the settlement?

The settlement includes American Modern Home Insurance Company, American Family Home Insurance Company, American Western Home Insurance Company, American Southern Home Insurance Company, American Modern Select Insurance Company, American Modern Surplus Lines Insurance Company, Consumers County Mutual Insurance Company and American Modern Insurance Group, Inc.

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3. Why is there a settlement?

The Court did not decide in favor of the Plaintiffs or American Modern, and has not found that American Modern did anything wrong. Instead, both sides agreed to settle. That way, the parties avoid the cost of a trial and potentially an appeal, and the people who qualify will get compensation. The Class Representatives and their attorneys think the settlement is best for all Class Members. The settlement does not mean that American Modern did anything wrong, no trial has occurred, and no merits determinations have been made.

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4. What is a Class Action lawsuit?

In a class action, one or more people called “Class Representatives” (in this case Pamela Green and Gary Edwards) sue on behalf of people who have similar claims. All these people are a “Class” or “Class Members.” One court resolves the issues for all Class Members, except for those who exclude themselves from the Class.

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5. Who is included in the Settlement?

The Class includes Persons who had a Covered Loss, where the claim was paid at less than the limit of liability (accounting for deductible), and where American Modern made an indemnification payment that included a deduction for depreciation of labor, or would have resulted in an indemnity payment for Structural Loss but for the deduction of labor depreciation. A Covered Loss means a first party insurance claim for Structural Loss, as defined below, that (a) occurred in Arkansas during the Class Period between April 11, 2009 through April 11, 2014; (b) American Modern or a court determined to be covered under an Arkansas homeowners insurance policy issued by American Modern; and (c) resulted in an indemnity payment for Structural Loss by American Modern, or would have resulted in an indemnity payment for Structural Loss but for the deduction of labor depreciation. Structural Loss means physical loss or damage to a home, building, manufactured home, condo, farm/ranch, rental dwelling, or other structure in Arkansas while covered by a homeowners insurance policy issued by American Modern.

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6. How can I get a Claim Settlement Payment?

The deadline for submitting a claim for obtaining a Claim Settlement Payment has now passed. If you submitted a signed or electronically verified claim form by the July 10, 2017 claim submission deadline, you may be eligible to receive a Claim Settlement Payment.

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7. How much will my payment be?

Class Members who completed and signed a claim form and timely mailed it to the proper address, or timely submitted the claim form online, may be eligible for a Claim Settlement Payment. Under the settlement, American Modern has agreed to pay 90% of the estimated labor depreciation that was withheld and not subsequently paid to a Class Member, plus 5% prejudgment interest on that amount, subject to some exclusions. You must have timely submitted a claim form in order to determine whether and how much estimated labor depreciation was withheld from your insurance claim payment. If you did not submit a claim form, you will not receive a Claim Settlement Payment.

If you submitted a claim form, and American Modern does not have sufficient information to determine whether you are a Class Member or what you are owed on your claim, you will need to provide a copy of the estimate (also called an Adjustor Summary) that was provided to you with your insurance claim. If you cannot provide an estimate, your claim may be denied. If American Modern’s information or your estimate shows that labor was depreciated but the amount of labor depreciation is not separately itemized, your Claim Settlement Payment will be based on the assumption that 42% of the total depreciation was for labor depreciation. For additional details on the payment terms, please see the Settlement Agreement by clicking here.

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8. If I am eligible, when will I receive a Claim Settlement Payment?

Payment will be mailed to eligible Class Members after the claims administration process is completed. This process can take time, so please be patient.

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9. Will I owe any income taxes for a settlement payment that I receive?

The tax treatment of the Claim Settlement Payment is the responsibility of each recipient. Accordingly, we suggest that you consult your tax advisor if you are not certain of the tax treatment of this distribution. Neither the Settlement Administrator nor the Parties can provide tax advice.

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10. Will this settlement/my participation affect my insurance?

Your participation in this settlement will not affect your insurance coverage.

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11. What if my mailing address or contact information changed after I submitted a Claim Form?

If you changed your mailing address or contact information after you submitted a Claim Form, you MUST write to the Settlement Administrator at Green Labor Depreciation Settlement, c/o GCG, PO Box 10350, Dublin, OH 43017-0350 to tell them of your address change. Failure to do so may waive your rights in this matter. When writing, please include your full name, your old address, your new address and your Claimant ID number, if available.

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12. What if my Claim Form is rejected or if I disagree with the amount of my settlement payment?

A disposition notice will be sent to Class Members informing them that they may dispute the amount of the Claim Settlement Payment or denial of their claim by requesting in writing final and binding arbitration by the Neutral Evaluator. The disposition notice shall further inform Class Members that: (i) to dispute the Claim Settlement Payment or denial of their claim and invoke arbitration, they must return any uncashed settlement check, the disposition notice, a statement of the reason why they are disputing the proposed disposition, and any supporting documentation to the Administrator within 45 days of the date of the notice; and (ii) if the settlement check is not timely returned, or if the settlement check is negotiated prior to final and binding arbitration by the Neutral Evaluator, then the dispute resolution process is automatically terminated, and the Class Member is not entitled to any further settlement payment.

The Administrator shall promptly provide American Modern and Class Counsel with any dispute resolution materials received from Class Members. Upon receipt, American Modern may reevaluate the claim and/or supply any additional supporting documentation or information to the Administrator with forty-five (45) days. The Administrator shall then promptly provide all materials received from the Class Member and American Modern to the Neutral Evaluator, unless American Modern has agreed to pay the claim, in which event the Administrator shall promptly issue a check to the Class Member for the agreed Claim Settlement Payment.

The Neutral Evaluator shall issue a decision, based solely on the written submissions without independent research or evidence, and subject to the express terms and conditions of the Stipulation, within thirty (30) days after receipt of materials from the Administrator. If applicable, the Administrator shall promptly issue a check to the Class Member for the Claim Settlement Payment in accord with the Neutral Evaluator’s decision. The Neutral Evaluator shall have exclusive jurisdiction to resolve any dispute as to final determination of a Claim Settlement Payment, and the decision of the Neutral Evaluator shall be final and binding on the Parties and Class Members and not subject to appeal or review by the Court. The Neutral Evaluator shall not have authority to make any award to a Class Member for payment of any amount in excess of the Claim Settlement Payment, determined as described in paragraphs 51 and 64 of the Amended Stipulation and Agreement of Settlement, or for any other damages, costs, attorneys’ fees, or other relief. The Neutral Evaluator shall also be bound by the provisions of paragraphs 99-101 of the Amended Stipulation and Agreement of Settlement concerning confidential and proprietary information.

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13. What if my Claim Form is rejected as being untimely?

A Claim Form is untimely if it was not mailed and postmarked, or submitted online before the deadline for claims, July 10, 2017. There is no further review or appeal of the Settlement Administrator’s determination that a Claim Form was not timely submitted.

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14. What if the Class Member is deceased or incapacitated?

A Claim Form may have been filed on behalf of the estate of a deceased Class Member or an incapacitated Class Member only by a Legally Authorized Representative. A Legally Authorized Representative means an Administrator, personal representative, or executor of a deceased Class Member’s estate, or a guardian, conservator, attorney-in-fact, or next friend of an incapacitated Class Member, or any other legally appointed person or entity responsible for handling the business affairs of a deceased or incapacitated Class Member. You must submit written proof of the authority or appointment of a Legally Authorized Representative with the Claim Form.

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15. What am I giving up if I participate in the Settlement?

Unless you excluded yourself, you are staying in the Class, and that means that you can’t individually sue American Modern and the Released Persons over the claims settled in this case, relating to deduction of labor depreciation from payments for Covered Losses. It also means that all of the Court’s orders will apply to you and legally bind you.

If you submitted a Claim Form, or if you do did nothing and stayed in the Class, you agreed to “release and discharge” all “Released Persons” of all “Released Claims.” “Released Claims” and “Released Persons” are defined in the Settlement Agreement, which can be found on this website by clicking here.

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16. What if I don't want to be included in the Settlement Class?

Class Members had the right to exclude themselves from the Settlement and to pursue a separate and independent remedy against American Modern by complying with the exclusion provisions. Class Members who wished to exclude themselves from the Settlement must have submitted a written request for exclusion postmarked by May 4, 2017.

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17. If I excluded myself, can I get money from the Settlement?

No. If you excluded yourself from the settlement, you will not receive a Claim Settlement Payment.

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18. If I didn’t exclude myself, can I sue American Modern for the same thing later?

No. Unless you excluded yourself, you gave up any right to individually sue American Modern for the claims that this settlement resolves. You must have excluded yourself from the Class by May 4, 2017.

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19. Can I object to the terms of the Settlement?

Class Members who did not request exclusion form the Settlement Class may have objected to the Proposed Settlement by filing a written notice of intent to object by May 4, 2017.

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20. What's the difference between objecting and asking to be excluded?

Objecting is simply telling the Court that you don’t like something about the settlement. You could object only if you stayed in the Class. Excluding yourself is telling the Court that you don’t want to be part of the Class or the settlement. If you excluded yourself, you have no basis to object because the case no longer affects you. If you objected, you will still be legally bound by the result.

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21. What if I did nothing?

You had the right to do nothing. However, if you did nothing, you’ll get no payment from this settlement. But, unless you excluded yourself from the settlement, you won’t be able to individually sue for the claims resolved in this case.

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22. Who are the lawyers representing the Class?

The Court appointed the following law firms to represent you and other Class Members as “Class Counsel”: Keil & Goodson; Mattingly & Roselius, PLLC; Murphy, Thompson, Arnold, Skinner & Castleberry; Crowley Norman LLP; James M. Pratt, Jr., P.A.; Kessler Topaz Meltzer & Check, LLP; and Taylor Law Partners.

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23. How will the lawyers and Class Representatives be paid?

The Court approved Class Counsel’s request for $820,448.66 to cover attorneys’ fees and reimbursement of their expenses, as well as incentive awards of $5,000 to each Class Representative for their efforts in prosecuting this litigation These payments, which were paid by American Modern, will not reduce the amount distributed to Class Members. American Modern will also separately pay the costs to administer the settlement.

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24. Will I have to pay the lawyers?

You do not have to pay Class Counsel.

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25. What was the purpose of the Final Approval Hearing?

At the Final Approval Hearing on May 24, 2017, the Court approved the settlement as fair, reasonable, and adequate. The Court also decided to award Class Counsel $820,448.66 as fees and expenses for representing the Class and to award the Class Representative $5,000 as incentive awards.

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26. Where can I get more information?

The notice summarizes the settlement. More details can be found in the Settlement Agreement, which can be found on this website by clicking here.

Please do not call or write the Court, the Judge or her staff, or American Modern or its counsel for information or advice about the settlement.

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