A florist failed to follow proper administrative procedures when he filed a lawsuit against State Farm Fire & Casualty Co., claiming he should have been charged lower insurance premiums due to the pandemic, said a federal appeals court on Thursday, upholding a lower court decision. .
Alissa’s Flowers Inc., of Independence, Missouri, filed a putative class action lawsuit against State Farm in the U.S. District Court in Kansas City, Missouri, in May 2020, alleging that it overpaid its premiums to State Farm in light of its “significantly lower exposure rate due to COVID-19,” according to the decision of the 8th U.S. Circuit Court of Appeals in St. Louis in Alissa’s Flowers, Inc. v. State Farm Fire & Casualty Co.
The court dismissed the case and was upheld by a three-judge panel of the court of appeal.
State Farm argued that Missouri law required the florist to submit its claims to the director of the Missouri Department of Insurance, according to the ruling.
The panel agreed. The decision said that under Missouri law, any “aggrieved” person or entity must first ask the insurer to investigate the matter, and if there is no adequate remedy, file a written complaint to the Director, who then pursues the matter.
“Alissa’s Flowers argues that she is challenging the premiums – not the rates – and therefore does not need to follow the statutory administrative review process,” the decision states.
“We find that the District Court did not confuse the terms ‘rate’ and ‘premium,’ as alleged by Alissa’s Flowers,” the decision states. The administrative review process provided for in the law “applies in the context of commercial insurance and to Alissa’s Flower claims.
“The District Court correctly determined that Alissa’s Flowers must exhaust administrative remedies because the ‘claims, in substance, constitute a challenge to State Farm’s rates,'” he said, citing an earlier order and affirming the lower court decision.
State Farm said in a statement, “We believe the 8th Circuit Court correctly ruled in upholding the dismissal of this case. Still, we know this has been a difficult time for many people, including business owners, and sympathize with everyone who has suffered amid COVID-19.
Plaintiffs’ attorneys did not respond to a request for comment.