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Lakewood : Insurer to Honor Claims

July 30, 1987

A group of Lakewood homeowners whose houses have suffered severe deterioration due to the chemical makeup of the soil beneath them has found a friend in the Allstate Insurance Co. According to a spokesman, the company has decided to honor "several" of the estimated 20 to 30 claims it has received from the distraught homeowners, and is still considering the remainder. None of the claims, the spokesman said, have so far been turned down.

The company's decision had been eagerly awaited by its policyholders in the Sunshine Homes tract south of Del Amo Boulevard near the 605 Freeway where the concrete slabs supporting as many as 100 homes face possible deterioration due to the high sulfate content of the soil. Because repairs can cost as much as $90,000 per home, at least one of the area's major insurance carriers--State Farm Fire and Casualty Co.--has refused to honor claims arising from the situation, a fact that has resulted in the filing of several lawsuits by dissatisfied homeowners.

Dick Donegan, underwriting manager for Allstate's Los Angeles metropolitan region, said the company has agreed to pay for repairs at some sites after making painstaking investigations into each individual claim. "It was just a matter of legwork," he said. "This particular type of claim is relatively new. We're kind of learning as we go along."

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