Washington Landlord Sues State Farm Over Seven-Adjuster Water Damage Claim

A Washington landlord’s lawsuit against State Farm Fire & Casualty Company centers on a water damage claim that allegedly changed hands seven times over eight months, with mounting mitigation costs and no final resolution. The dispute began in March 2025 after a clogged toilet caused water damage at a rental property in Spokane Valley. While coverage for water damage was accepted, disagreements quickly emerged over scope and pricing.

According to the complaint, State Farm issued an initial payment of about $22,000 on an estimate near $29,000, while the insured’s contractor placed repair costs closer to $55,000. The gap widened when Restoration 1, a mitigation vendor approved to perform drying and asbestos abatement, submitted invoices totaling nearly $120,000. State Farm’s alleged counter was an offer slightly above $22,000 for mitigation, following its own assessment.

For adjusters, the most pointed allegations involve claim continuity and communication. The insured claims the file passed through six additional adjusters after the original handler, with repeated assurances that the claim would be prioritized. Despite those assurances, the property allegedly remained uninhabitable six months after the loss, and the contractor eventually recorded a lien due to nonpayment.

The lawsuit invokes Washington’s Insurance Fair Claims Act after the insured provided the required notice to both the carrier and the Washington Office of the Insurance Commissioner. While the allegations are unproven, the case highlights how adjuster turnover, unresolved scope disputes, and strained vendor relationships can escalate a routine water loss into significant litigation exposure. The matter is now pending in the United States District Court for the Eastern District of Washington, with State Farm yet to file a response.