More than 100 Mississippi policyholders who sued State Farm Insurance Cos. for refusing to cover damage from Hurricane Katrina have been paid this week as part of a multimillion dollar settlement with the insurer, attorneys for the homeowners said Tuesday.

State Farm agreed last month to pay about $80 million to settle lawsuits filed by 640 policyholders whose claims were denied after the Aug. 29, 2005, storm, which destroyed tens of thousands of homes on Mississippi’s Gulf Coast.

Richard “Dickie” Scruggs, an attorney whose legal team represents all 640 of the policyholders, said more than 100 of his clients have received checks this week. The rest are expected to be paid by the end of next week.

“It’s incredibly rewarding,” Scruggs said. “This is something I wish I could do for the whole Gulf Coast.”

Max and Linda Ingram, who moved north to Carthage, Miss., after Katrina leveled their beachfront home in Ocean Springs, drove down Monday to pick up their check and sign the paperwork necessary to settle their lawsuit.

“It felt like justice had been served,” Max Ingram said. “I just wish all of the policyholders could experience the same thing. The coast can’t rebuild if the insurance companies don’t pay.”

State Farm had denied the Ingrams’ entire claim, blaming the damage to their home on Katrina’s storm surge. The Bloomington, Ill.-based company and other insurers say their policies cover damage from a hurricane’s wind but not from its rising water, including wind-driven surge.

Max Ingram, 70, said the terms of his settlement are confidential, but noted that his share of the money will allow him to finish building a new home in Carthage.

“I didn’t want anything more than what they owed me, and I didn’t want anything less,” he said.

Sen. Trent Lott, R-Miss., and Rep. Gene Taylor, D-Miss., are among the policyholders settling with State Farm. Both had homes destroyed on the coast. Scruggs said neither has been paid yet, but he added, “I don’t expect any trouble with that.”

State Farm’s settlement with Scruggs’ clients and Mississippi Attorney General Jim Hood also resolves a lawsuit that Hood filed against the company. Hood agreed to drop State Farm from the suit and end a criminal investigation of the company’s post-Katrina claims practices.

A “class action” portion of the deal also called for State Farm to pay at least $50 million to thousands of policyholders who haven’t sued the company but can have their claims reopened, reviewed and possibly paid. However, a federal judge has refused to endorse this part of the proposed settlement.

U.S. District Judge L.T. Senter Jr. said in a Jan. 26 ruling that he does not have enough information to determine how many policyholders would benefit from that part of the deal or how much each can be paid.

Senter also said he is concerned about a lack of any guaranteed payments to policyholders whose homes were not completely destroyed. He noted that cases already in litigation would be excluded from a procedure for resolving disputes through binding arbitration.

“We’re still trying to come up with a way to address the judge’s concerns,” Scruggs said. “I’m optimistic that we can better demonstrate the benefits of the class settlement to the judge, given the alternatives.”

State Farm spokesman Phil Supple said the settlements with Scruggs’ clients show that the company is “fulfilling our agreement” with the policyholders. That part of the settlement is separate, he added, from the class action portion of the deal that Senter wouldn’t endorse.

In the meantime, Senter is soliciting ideas from other lawyers with Katrina lawsuits. In a letter to 180 attorneys last Friday, Senter said he is looking for a broader approach to a settlement.

“While the proposed class action is currently limited to State Farm policyholders,” Senter wrote, “any procedure the court approves as an alternative to litigation would likely serve as a de facto model that would apply to similar claims against the other major insurers, Allstate and Nationwide.”

Senter said he is open to establishing an “arbitration alternative” to the binding arbitration procedure outlined in the proposed settlement, but added, “Unless such a procedure offers substantial benefits for both parties, it will not succeed.”

The judge asked attorneys to respond to his letter by Feb. 12.