To settle a years-long securities class action lawsuit against it, Allstate Corp. has agreed to set up a $90 million fund for shareholders who accused the insurer of false and misleading statements regarding its auto insurance business.

According to court documents filed Aug. 14 in U.S. District Court for the Northern District of Illinois, the settlement, which needs the court’s approval, ends litigation dating back nearly seven years. Court records show dozens of filings related to consolidation, motions to dismiss, discovery and expert testimony, and finally mediation. The suit was eventually led by pension and annuity funds for Northern California Carpenters and the City of Providence.

The settlement will cover purchasers of Allstate Corp. stock from October 29, 2014 through August 3, 2015.

The class alleged Allstate in 2015 misrepresented a large spike in auto claims frequency by saying it was caused by external factors—namely miles driven and weather. However, the defendants alleged the Northbrook, Ill.-based insurer relaxed underwriting standards to grow, which caused a dramatic increase in frequency and a drop in profitability—as well as a drop in stock price.

“Allstate’s growth in auto policies was the result of underwriting less profitable and riskier business, which was causing a spike in claims frequency that would reduce overall margins and worsen the Allstate brand auto underlying combined ratio as claims from the new policies were processed, which was reflected in the largest spike in claims frequency in nearly five years and reflective of a deterioration in the quality of the business,” the original suit alleged.

If the court approves the proposed settlement, the average recovery to the class would be about $0.46 per share.

Allstate said it continues to deny the allegations of wrongdoing, that it violated any law, or that the class suffered any losses. The settlement avoids “the costs and risks of continuing the litigation” and releases Allstate from liability, according to the proposal.

Attorneys’ fees will be paid from the fund, according to court documents, in an amount not to exceed 25 percent of the fund. Attorneys for the class will also apply for litigation expenses not to go over $4.6 million.

This article was previously published on Insurance Journal’s website. Reporter Chad Hemenway is the National Editor of Insurance Journal.