State Farm Fire & Casualty Co. has agreed to settle hundreds of lawsuits filed by policyholders and reopen and pay thousands of other disputed claims, the Associated Press reported. The landmark deal potentially is worth hundreds of millions of dollars for Mississippi homeowners devastated by Hurricane Katrina.

The settlement calls for State Farm to pay about $80 million to more than 600 policyholders who sued the company for refusing to cover damage from the 2005 storm. State Farm also agreed to pay at least $50 million — and possibly hundreds of millions more — to thousands of Mississippi policyholders whose claims were denied but didn’t sue the company.

State Farm’s agreement with Mississippi Attorney General Jim Hood and lawyers for the more than 600 policyholders resolves a civil lawsuit that Hood filed against the company for refusing to cover damage from Katrina’s storm surge.

The settlement also resolves Hood’s criminal probe of allegations that the insurer fraudulently denied claims after the storm.