Terminix to Pay $60 Million in Coastal Alabama Termite Claims Settlement
November 10, 2020
Last week, the Alabama Attorney General’s Office announced a $60 million settlement with Terminix over its termite treatment practices in Mobile, Baldwin and Monroe counties. The settlement stems from Terminix’s business practices in coastal counties where they did not provide annual termite inspections as required in their contracts and then drastically increased annual premiums to get out of costly contracts.
If you have a client who used Terminix in coastal Alabama in the past several years, please be sure they are familiar with this settlement. Consumers may be eligible for refunds and/or new services, including up to $650 from the Consumer Relief Fund, the re-treatment of their home at no cost by Terminix, new inspections, the repair of termite damage by Terminix, and potential reinstatement of lapsed policies at 2018 premium levels.
According to the Attorney General’s Office, the settlement must first be approved by the Montgomery County Circuit Court judge. Following court approval, eligible Terminix customers will be contacted with more information on the claims and refunds process.
The full breakdown of the settlement is:
- $25 million for the Alabama Consumer Relief Fund for refunds to overcharged consumers and to consumers forced to pay other termite companies for services they should have received from Terminix (includes $650 to any Alabama consumer who left Terminix and hired another company to provide termite protection, or pay the difference between the former customer’s new termite protection costs and previous costs);
- $10 million to retreat over 12,000 customer homes in Mobile, Baldwin and Monroe counties, whether or not those homes had suffered termite damage;
- $20 million to the Attorney General’s Office to settle the State of Alabama’s claims against Terminix and to be reinvested in statewide consumer protection efforts;
- $4 million to the Alabama Department of Agriculture and Industries; and,
- $1 million charitable contribution to the Auburn University Department of Entomology.
Terminix also has agreed to:
- New inspections of homes in affected areas to ensure no termite infestations exist,
- Repair all termite damage claims in affected areas,
- Adopt a price increase schedule that is reasonable and affordable, and
- Reinstate eligible consumers who lost lifetime Terminix contracts at the reasonable price levels paid in 2018.