Allstate Arizona Property Insurance Depreciation Settlement, Who Qualifies, Payment Amounts, and the January 29, 2027 Claim Deadline

If Allstate paid you on an Arizona home or building claim between April 25, 2017 and October 1, 2026 and withheld “nonmaterial depreciation,” you may qualify for money. Most eligible people get 50% of the withheld depreciation that was never paid back, plus 10% simple interest. If all of it was later paid, the payment is $10 to $360. You must file a claim form by January 29, 2027. Final court approval is still pending, so no payments are going out yet.

Official settlement website: HernandezDepreciationSettlement.com | File a claim online: Submit Claim | Claim form (PDF): Download

The case is Hernandez v. Allstate Vehicle and Property Insurance Company, and it asks whether Allstate improperly subtracted “nonmaterial depreciation” when calculating payments on structural damage claims. Allstate denies wrongdoing, and the settlement is not an admission of liability.

Allstate Arizona Depreciation Settlement: Quick Facts

Detail	Information
Settlement name	Allstate Hernandez Depreciation Settlement
Case name	Hernandez v. Allstate Vehicle and Property Insurance Company
Case number	CV-2026 00048
Court	Superior Court of Arizona, Mohave County
Representative plaintiff	Lillie Hernandez
Defendant	Allstate Vehicle and Property Insurance Company and affiliated insurers (listed below)
Who is covered	Arizona policyholders with a structural loss claim paid between April 25, 2017 and October 1, 2026 where Allstate withheld nonmaterial depreciation
Main payment	50% of unpaid withheld nonmaterial depreciation, plus 10% simple annual interest
Alternative payment	$10 to $360 if all withheld depreciation was later paid
Claim deadline	January 29, 2027
Opt-out and objection deadline	November 16, 2026
Final approval hearing	December 15, 2026, 10:30 a.m., by Zoom (subject to change)
Status	Preliminary approval granted; final approval pending
Claim form required?	Yes
Official settlement website	HernandezDepreciationSettlement.com
Claim form	Submit online or download the PDF
Settlement administrator	Angeion Group
Phone	1-866-945-4242
Attorneys’ fees	Class Counsel may ask for up to $870,000, paid by Allstate separately from class payments

What the Allstate Depreciation Lawsuit Is About

When a covered building is damaged, an insurer often pays in two steps. The first payment is the “actual cash value,” or ACV: the estimated cost to repair or replace the damage, minus depreciation and the deductible. The insurer may pay the withheld depreciation later, once repairs are done.

The lawsuit alleges Allstate used settings in Xactimate, the estimating software (or similar programs), to depreciate items that should not be depreciated. The settings are called “depreciate removal,” “depreciate non-material,” and “depreciate O&P” (contractor overhead and profit). The settlement calls the result “Nonmaterial Depreciation.” Plaintiff Lillie Hernandez says this lowered the first payment on Arizona claims.

Hernandez filed her Second Amended Complaint on September 27, 2023, in the U.S. District Court for the District of Arizona, alleging breach of contract and seeking a declaratory judgment. The parties mediated in April 2025 and reached an agreement in principle in September 2025. The case was then dismissed from federal court and the settlement was brought in Mohave County Superior Court.

The court has not decided who is right, and there has been no trial.

What does “nonmaterial depreciation” mean here?

It is a defined term in the settlement: the application of those specific depreciation settings. The settlement does not cover every depreciation deduction. A homeowner whose estimate shows depreciation on roofing materials should not assume the claim qualifies. It must meet the settlement’s specific requirements.

Who Qualifies for the Allstate Arizona Settlement

You are in the settlement class if all of these are true:

1. You were insured under a property policy issued by Allstate (or a covered affiliate) and made a structural loss claim for property in Arizona.
2. Allstate paid you based on an Xactimate estimate (or a comparable estimating program).
3. The payment was an ACV payment from which nonmaterial depreciation was withheld.
4. The date of your first ACV payment falls between April 25, 2017 and October 1, 2026.

“Structural loss” covers a house, building, manufactured home, condo, rental dwelling, or other structure in Arizona. If your loss date and payment date fall on different sides of the class period, call the administrator rather than assuming either way.

Which insurance companies are covered?

The settlement refers to these companies together as “Allstate”:

• Allstate Vehicle and Property Insurance Company
• Allstate Insurance Company
• Allstate Indemnity Company
• Allstate Property and Casualty Insurance Company
• Esurance Property and Casualty Insurance Company
• Encompass Insurance Company of America
• Encompass Property and Casualty Company
• Encompass Indemnity Company
• North Light Specialty Insurance Company

Who is not included?

• Policyholders whose policy form or endorsement expressly allowed depreciating labor
• Policyholders whose ACV payment or payments used up the policy limits
• Policyholders whose claims were denied or abandoned without an ACV payment
• Allstate and its officers and directors
• The judge and court staff on the case, and their immediate families
• Class Counsel and their immediate families

If you received a notice in the mail, Allstate’s records identified you as a likely class member. That is not a guarantee of payment. If you did not get a notice but think you qualify, call 1-866-945-4242.

How Much Will Allstate Pay Arizona Policyholders?

There is no single payout for everyone. The amount depends on whether the withheld depreciation was ever paid back to you.

Option 1: 50% of unpaid depreciation plus 10% interest

If you were never paid all of the withheld nonmaterial depreciation (the situation for most class members), you get 50% of the net estimated nonmaterial depreciation withheld and not later paid, plus simple interest at 10% per year. Interest runs from the date of your first ACV payment through the settlement’s Effective Date.

Illustration only: if the administrator determines $4,000 of eligible depreciation was withheld and never paid, the 50% component is $2,000 before interest. Your real figure depends on your claim records, later payments, policy limits, and policy terms. The interest is simple, not compound.

Option 2: A one-time payment of $10 to $360

If you were later paid all of the withheld depreciation, you get a one-time payment based on the amount of nonmaterial depreciation released:

Nonmaterial depreciation released	Settlement payment
$1 to $2,500	$10
$2,501 to $5,000	$20
$5,001 to $7,500	$30
$7,501 to $10,000	$40
$10,001 to $15,000	$60
$15,001 to $20,000	$80
$20,001 to $30,000	$120
$30,001 to $40,000	$160
$40,001 to $50,000	$200
$50,001 to $60,000	$240
$60,001 to $70,000	$280
$70,001 to $80,000	$320
More than $80,000	$360

The relevant figure is the amount of nonmaterial depreciation, not the total insurance payout for the damage.

Limits and other notes

• Payments are subject to your policy’s terms, limits, and deductible. Any part of a payment that would push the claim total, plus your deductible, over the policy limit is not paid.
• You keep any replacement cost benefits still available under your policy. The settlement does not release them.
• The agreement sets payment formulas rather than one fixed total fund, so each person’s payment is calculated individually from Allstate’s records and your claim form.

How to File a Claim in the Hernandez v. Allstate Settlement

You must submit a claim form to get paid. Filing is free, and doing nothing means no payment.

1. Get the form. If you received a notice, a form came with it and may be pre-filled. You can also file online at the official claim page, download the PDF, or request one at 1-866-945-4242. Spanish-language forms and notices are available on the website.
2. Gather your details. You will need your name and current address, email and phone, the Notice ID from your notice, the insured person’s name, the insured property address, the date of loss, and your policy and claim numbers. Use your original insurance paperwork where you can.
3. Confirm your information. You confirm your contact details are correct and that you have not assigned the claim to someone else. If you assigned your insurance claim to a contractor before preliminary approval, special rules apply: you must identify the contractor and attach written proof of the assignment.
4. Submit by January 29, 2027. File online before midnight Mountain Standard Time on that date, or mail a signed form postmarked by January 29, 2027 to: Allstate Hernandez Depreciation Settlement, c/o Settlement Administrator, 1650 Arch Street, Suite 2210, Philadelphia, PA 19103.
5. File a separate form for each loss. One form covers the one covered loss identified on it. If you had more than one qualifying claim during the class period, complete, sign, and submit a form for each.
6. Filing for someone who has died or cannot act for themselves? Include written proof that you are their legally authorized representative.

The form does not need to be notarized or signed under penalty of perjury. If it is incomplete, the administrator must tell you and give you 30 days to fix it. The administrator will also mail a reminder postcard at least 30 days before the deadline to class members who have not filed.

Never pay anyone to register you or accept a promise of a guaranteed payout. The official process is free.

Your Options: Claim, Opt Out, Object, or Do Nothing

Option	What it does	Deadline
Submit a claim form	The only way to get a payment	January 29, 2027
Exclude yourself (opt out)	No payment, but you keep the right to sue Allstate over these claims	Postmarked by November 16, 2026
Object	Tell the court what you do not like about the settlement	November 16, 2026
Attend the hearing	Speak to the court (objectors who file notice)	December 15, 2026
Do nothing	No payment, and you give up the right to sue over the settled claims	None

How to opt out

Mail a signed letter with your full name and address, saying you want to be excluded from the Hernandez v. Allstate settlement (No. CV-2026 00048), postmarked by November 16, 2026, to: Allstate Hernandez Depreciation Settlement, Attn: Exclusion Requests, P.O. Box 58220, Philadelphia, PA 19102. You cannot opt out by phone, email, or the website, and group opt-outs are not allowed. Opting out means no payment from this settlement.

How to object

You can only object if you stay in the class. By November 16, 2026, file a written objection with the Clerk of the Court, Arizona Superior Court for Mohave County, 401 E Spring St, Kingman, AZ 86401, and mail a copy to the administrator at Allstate Hernandez Depreciation Settlement, Attn: Objection, P.O. Box 58220, Philadelphia, PA 19102. Include the case name and number, your full name and address, your reasons, and whether you or your lawyer plan to appear. To speak at the hearing, also file a notice of intention to appear by the same date. Objecting does not remove you from the class, and you can still be bound if the court approves the settlement.

What happens if you do nothing?

You receive no payment because a valid claim form is required. If you have not opted out, you can still be bound by the settlement and give up the right to sue Allstate over the claims it resolves. Not filing a claim and opting out are very different choices.

What You Give Up by Staying in the Settlement

If you do not opt out, you release Allstate and related parties from claims tied to nonmaterial depreciation in the adjustment or payment of a covered loss, including claims you do not know about yet. That applies whether or not you file a claim or cash a check. The release does not cover claims that arise after the settlement takes effect.

Key Dates

Date	Event
April 25, 2017 to October 1, 2026	Class period
November 16, 2026	Deadline to opt out or object
December 15, 2026, 10:30 a.m.	Final approval hearing (Zoom; check the website for changes)
January 29, 2027	Claim deadline

When Will Allstate Settlement Payments Be Sent?

There is no confirmed payout date as of October 27, 2026. Payments cannot go out until the court grants final approval and any appeals are resolved, because the settlement does not take effect until the judgment is final. After that, Allstate funds the payments and the administrator mails checks within 10 days of receiving the money. Checks expire 120 days after they are issued, so cash yours promptly.

Allstate has the right to terminate the settlement in some circumstances, including if more than 3.5% of known class members opt out. If the settlement is terminated or not approved, no payments are made. Submitting a claim does not guarantee approval. Keep your address current and check the official website for updates.

If You Disagree With Your Payment Amount

Every class member who files a timely claim form receives a notice explaining how to dispute the payment or a denial. To dispute, return your uncashed settlement check (if you received one) and explain your reasons in writing with supporting documents, postmarked within 30 days of the date on the notice. A neutral evaluator, retired judge Peter Swann, decides disputes using only the written materials. His decision is final and cannot be appealed. If you cash the check first, the dispute process ends.

Why Did Allstate Agree to Settle?

The settlement agreement says the parties chose to resolve the disputed claims to avoid the expense, uncertainty, and burden of continued litigation. The court has made no finding that Allstate violated the law. A settlement should not be described as a ruling that Allstate broke Arizona insurance law.

This case is separate from other Allstate litigation. For a wider overview, see our report on Allstate class action lawsuits in 2026. Depreciation disputes have also involved other insurers, such as the State Farm Missouri $25M settlement over underpaid structural damage claims, but that case involved different claims, a different state, and a different formula, so its terms do not decide what an Allstate policyholder receives. For the broader picture, see State Farm lawsuits explained. You can also browse our guide to how depreciation works on property insurance claims and our list of Arizona homeowners insurance class action settlements.

Attorneys’ Fees and Costs

The court appointed Erik Peterson of Erik Peterson Law Offices, PSC; James Brandon McWherter of McWherter Scott Bobbitt, PLC; T. Joseph Snodgrass of Snodgrass Law LLC; Michaile Berg of Berg Law; and Broc Wickland and Jake Baldridge of Whitney Whitney Baldridge Atkinson, PLLC as Class Counsel. You do not pay them directly.

They plan to ask the court for up to $870,000 in fees and expenses and a service award of up to $7,500 for Lillie Hernandez. Allstate agreed not to oppose those amounts, and the court can award less. Allstate pays these amounts and the cost of administration separately, so they do not reduce class members’ payments.

Frequently Asked Questions

Who qualifies for the Allstate Arizona depreciation settlement?

Policyholders with an Arizona structural loss claim, adjusted with an Xactimate (or comparable) estimate, where Allstate withheld nonmaterial depreciation from an ACV payment first made between April 25, 2017 and October 1, 2026, and who do not fall within an exclusion.

How much can I get?

Most eligible members get 50% of the unpaid withheld nonmaterial depreciation plus 10% simple annual interest. Members who were later paid all of it get $10 to $360. Amounts depend on your records.

What is the claim deadline?

January 29, 2027, online by midnight Mountain Standard Time or by mail postmarked that day.

Do I have to file a claim?

Yes. No claim form, no payment.

Do I need a separate claim form for each property or loss?

Yes. File one form for each covered loss.

What is the difference between opting out and not filing a claim?

Opting out (by November 16, 2026) keeps your right to sue Allstate but gives up any payment. Not filing a claim also gives up payment, and if you have not opted out you still give up the right to sue over the settled claims.

When will I get paid?

Not before final approval and the end of any appeals. After that, checks are mailed within 10 days of Allstate funding the payments.

Is the settlement final?

No. The court granted preliminary approval, and the final approval hearing is scheduled for December 15, 2026.

Does the settlement mean Allstate admitted wrongdoing?

No. Allstate denies the allegations, and the court has not ruled on the merits.

Who do I contact with questions?

Use the official website or call 1-866-945-4242. The notice says not to call the court, the judge, or Allstate.

Official Settlement Documents and Contact Information

• Official settlement website: HernandezDepreciationSettlement.com
• Submit a claim: Official online claim page
• Claim form: Download the claim form (PDF)
• Class notice: Notice of Class Action Settlement (PDF)
• Settlement agreement: Class Action Stipulation and Settlement Agreement (PDF)
• Important documents: Official documents page
• FAQ: Official settlement FAQ
• Administrator: Angeion Group, 1-866-945-4242, [email protected]

Sources

1. Notice of Class Action Settlement, Hernandez v. Allstate Vehicle and Property Ins. Co., No. CV-2026 00048 (Ariz. Super. Ct., Mohave County)
2. Class Action Stipulation and Settlement Agreement, Hernandez v. Allstate Vehicle and Property Insurance Company, including Exhibits A through E
3. Official settlement website, hernandezdepreciationsettlement.com, home page, important documents, and FAQ

Disclaimer: This article summarizes the proposed settlement and official notice. Eligibility and payment amounts depend on the settlement’s definitions, exclusions, and claim review. The settlement remains subject to final approval, and deadlines and the hearing date can change, so check the official website before you act. Allstate denies wrongdoing. This is general legal information, not legal advice, and does not create an attorney-client relationship. AllAboutLawyer.com is an informational website, not a law firm. We will update this article if the court reschedules the hearing or rules on final approval.