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State Farm Class Action Claims Premiums Unjustly Profit from Closed Business

State Farm Unfair Business Practice

State Farm faces a class action lawsuit for allegedly conducting unfair business practices when the company has unfairly charged small businesses with premiums amidst the coronavirus pandemic.

According to the class action lawsuit, State Farm has violated California laws against unfair business practices as it “unjustly profits from the COVID-19 pandemic by collecting excessive” and “unfair” premiums.

Read about the case under the name: Boobuli’s LLC v. State Farm Fire And Casualty Company, Case No. 3:20-cv-07074, N.D. CA.

Are you affected by the allegations in this class action lawsuit? Contact us today for help.

Excessive and Unfair Business Practice Amid COVID-19

The class action lawsuit claims that “while Covid-19 wreaked its continuing toll on collective health, business, and society, State Farm chose a windfall of excessive premiums over fairness mandated by California public policy.”

The lawsuit argues that the State Farm premiums are unfair because commercial property rates and casualty policies were determined using pre-COVID metrics. The rates allegedly depend on a business’s risk factors that are “associated with type, volume, and location.”

However, these factors have dramatically changed since the pandemic hit. Business operations halted for months and safety measures were implemented when the businesses reopened which meant lower sales.

The lawsuit contends that State Farm premiums “did not incorporate or contemplate that the majority of insured businesses would cease to operate or that their operations would be severely reduced.”

The “substantial reduction” in business should have been considered when premiums were being determined.

State Farm has acknowledged this and the extraordinary circumstances the coronavirus outbreak presents and has said that it will look for ways to support customers.

However, the class action lawsuit observes that “State Farm has continued to collect excessive premiums and failed to issue appropriate refunds.”

California law limits “insurance premiums and rates to a fair rate of return on the risk covered by the policy” but the premiums that State Farm collects are not “commensurate with [business] returns” and aren’t “sufficient to attract capital and maintain credit.”

State Farm is accused of unjust enrichment and violations of California’s Business and Professions Code.

Editor’s note on the State Farm Class Action Lawsuit:

This piece is written about the recent State Farm Lawsuit. If you are considered eligible to be among the class of consumers described in the class action, you may eventually be able to participate in receiving any compensation the court may award.

If you believe that what is alleged in the State Farm Premiums class action lawsuit has affected you, please don’t hesitate to reach out to us.

Contact Us

We’d be happy to help you take a step in the right direction, fight this issue, and better enable you to join the consumer class action. If interested, please send an email to, find us on Twitter or Facebook, or even connect with us directly on our website! We look forward to hearing from you all.

Similarly, please check out our current list of Class Actions and Class Action Investigations, here.

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