The Alabama Supreme Court has opened the window a little wider into insurance carriers’ claims-handling procedures, not only requiring them to be made available in some lawsuits but also to be shared with plaintiffs’ lawyers in similar litigation.
The high court’s decision, in a side issue in Foor vs. State Farm, tempered a lower court’s order requiring State Farm to share closely held and trade-secret infor
mation on how damage estimates are revised or reduced. The Bullock County Circuit Court’s 2025 decision, in a homeowners’ roof claim dispute, is the latest skirmish in the years-long, multi-state war of words between adjusters and policyholder advocates on one side and a few large insurers on the other.
“While we would have preferred a different outcome, we appreciate the meaningful safeguards the Court placed around confidential information,” a State Farm spokes
person said in an email Thursday. “The ruling requires recipients of confidential information to abide by the protective order, and preserves the court’s authority to enforce those protections, including requirements to return or destroy materials when those cases conclude.”
The lower court’s decision, allowing significant sharing of confidential claims handling procedures, had generated widespread concern among insurers, business groups and legal organizations. It resulted in no fewer than three friend-of-
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the-court briefs that urged the high court to overturn or rein in the circuit court’s ruling.
“The ‘sharing’ provision in the (lower court’s) order relinquishes near-complete control of some of State Farm’s most sensitive information to plaintiffs’ counsel for their unfettered, nationwide use,” reads an amicus curiae brief filed in the appeal by the U.S. Chamber of Commerce and the American Tort Reform Association.
Attorneys with the Alabama Free and Fair Enterprise Institute also penned an amicus brief, noting that the Attorney Information Exchange Group, based in Birmingham, runs one of the largest clearinghouses for documents gained in litigation, for other litigants’ use.
“…Once confidential information is outside the control of the court, there is no limit as to how the information could be used by others,” attorney Ed Haden wrote for the Institute.
In the State Farm case, the homeowners in Union Springs, James and Kristina Foor, said a winter storm in early 2024 caused significant hail and wind damage to their roof. A roofing contractor gave an estimate for $9,112, and the Foors filed a claim with State Farm.