American Family Insurance Structural Loss Settlement

American Family Mutual Insurance Co.

American Family Insurance customers who had a property insurance policy in Missouri and made a structural loss claim between April 27, 2012, and April 27, 2017, may qualify to claim a cash payment from a class action settlement.

American Family Mutual Insurance Co. agreed to pay $37.75 million to settle a class action lawsuit alleging it deducted nonmaterial depreciation from certain structural loss insurance claims in Missouri, which plaintiffs argued was improper under state law.

Who can file am American Family Insurance claim?

Class members must meet the following criteria:

American Family issued them a property insurance policy in Missouri between April 27, 2012, and April 27, 2017.
They made a structural loss claim under Coverage A or Coverage B of their policy.
American Family used an Xactimate estimate to determine their actual cash value payment.
They were either:

Issued an ACV payment from which nonmaterial depreciation was withheld OR
Would have been issued an ACV payment but the withholding of nonmaterial depreciation caused their loss to fall below the deductible

A structural loss means physical damage to a home, building, manufactured home, condo, rental dwelling or other structure. Nonmaterial depreciation refers to depreciation of labor costs, overhead and profit, or other non-material items (excluding sales tax) as calculated by Xactimate software.

Consumers who received a notice about this settlement have been identified as a possible class member.

How much is the insurance policy settlement payout?

The amount class members receive from the settlement depends on the details of their claim:

If nonmaterial depreciation was withheld from a class member's actual cash value payment and not subsequently paid or if the withholding caused their loss to fall below the deductible, they can receive 90% of the nonmaterial depreciation withheld plus simple interest at 4.75% per year from January 1 of the year the loss was reported through Jan. 1, 2025.
If all nonmaterial depreciation that was withheld was subsequently paid to the class member, their payment will be based on the following schedule:

$1-$5,000.99: $10
$5,001-$10,000.99: $20
$10,001-$20,000.99: $40
$20,001-$40,000.99: $80
$40,001-$60,000.99: $120
$60,001-$80,000.00: $160
Greater than $80,000.00: $200

How to claim a nonmaterial depreceiation class action rebate

Class members can file a claim online or download, print and complete the PDF claim form and mail it to the settlement administrator. The claim form deadline is Oct. 10, 2025.

Settlement administrator's mailing address: Varney v. American Family Administrator, P.O. Box 3129, Portland, OR 97208-3129

Class members who had more than one covered loss during the class period must file a separate claim form for each loss.

What proof and documentation is required to submit a claim?

All claimants must provide their American Family policy number and American Family claim number.

To file an online claim, class members must provide their unique ID and PIN. The unique ID is a 10-character alphanumeric value and the PIN is four digits. They are both located in the upper right-hand corner of the claim form found in the claim package that was mailed to class members. Those who did not receive a claim form and believe they should have should contact the settlement administrator at the above address or 888-861-0342.

Those submitting a claim as a legally authorized representative (such as for a deceased or incapacitated policyholder) must provide documentation proving their authority. Contractors with an assignment of benefits must attach the assignment contract and provide the contractor’s information.

Payout options

The settlement administrator will mail paper checks to eligible class members at the address provided on the claim form.

Settlement costs

The following costs are paid separately from claims and do not affect any class member's payout:

Settlement administration costs: To be determined
Attorneys’ fees, costs and expenses: Up to $9,437,500
Service award to class representative: Up to $7,500

Important dates

Exclusion deadline: July 28, 2025
Final approval hearing: Aug. 26, 2025
Claim deadline: Oct. 10, 2025

When is the Varney v. American Family payout date?

Payments will be mailed to eligible class members approximately 20-50 days after the court grants final approval of the settlement and any appeals are resolved.

Why is there a class action settlement?

The class action lawsuit lawsuit alleged American Family Insurance improperly deducted nonmaterial depreciation (such as labor and overhead) from certain structural loss insurance claims in Missouri, reducing payments to policyholders.

American Family denied wrongdoing but agreed to settle to avoid the expense and uncertainty of further litigation.