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Articles Posted in Bad Faith

Recently, a Florida appellate court issued an opinion in an insured’s appeal of a circuit court’s final order granting her insurance company’s motion to dismiss her claim for bad faith. According to the court’s opinion, the plaintiff filed a claim with her insurance company for damages to her home from a hurricane. The homeowner claims that, despite admitting the loss was covered, the insurance company “grossly undervalued the claim” and “refused to negotiate the damages.” An appraisal panel found that the damages the woman claimed were appropriate, further supporting the woman’s contentions against the company.

Abiding by the condition precedent to bringing a bad faith action, the woman filed a civil remedy notice (CRN) with the Department of Financial Services (DFS) and the insurer. Within sixty days of the DFS’s acceptance of the CRN, the company did not pay damages. Thus, the homeowner argued that the company committed bad faith in adjusting her claim. The insurance company argued that the notice was ineffective because the CRN misidentified the insurer. The homeowner appealed a circuit court’s ruling in favor of the insurance company, arguing that the company waived their argument by not raising it in its response to the CRN.

On appeal, the homeowner argued that the insurance company never claimed that the incorrect identification caused it any prejudice. Instead, the plaintiff claimed that the insurance company simply denied the claim and argued that the loss did not exceed the policy’s deductible, without attempting a cure. Second, the company had actual notice of the CRN within the cure period and responded to the notice. Next, the company waived any misnomer defects by timely responding without any objections. Finally, the company’s failure to note the misnomer in its CRN response, and failure to bring the defect to her attention, warrants the application of estoppel principles. The insurance company argued that the plaintiff’s claim failed to satisfy the condition precedents because it was filed against another company, the CRN was legally insufficient, and the company could not cure the defect.

Owning a home is a major milestone, but also comes with significant responsibilities and costs. Unlike renting, maintenance is no longer a call away to help fix things when they break or leak in your home. Home insurance, however, can often provide recourse in unexpected situations that are out of your control. These insurance policies often have specific rules and instructions on how to file a claim in the event of an issue that gives rise to a claim. As a homeowner, it is crucial that you read and understand these rules so that if an incident arises in your home, you can properly assert your rights for recovery.

In a recent Florida District Court of Appeal opinion, a homeowner filed a lawsuit against his home insurance company, arguing that they had breached their contract. The plaintiff’s home was insured by the defendant. The insurance policy provided that in the event of a loss giving rise to the claim, the homeowner must provide “prompt notice” to the defendant, give the defendant the requested records and documents, and submit to an examination under oath to recover for the loss.

Following a major plumbing leak incident in the homeowner’s house, the plaintiff provided notice and documentation of loss, but failed to show up for his examination under oath because he was out of the country and unaware that the examination under oath had been scheduled. The defendant subsequently denied the plaintiff’s claim, arguing that the plaintiff had breached the insurance policy’s requirements. The lower court ruled in favor of the defendant, and the plaintiff appealed.

Recently, a Florida appellate court issued an opinion in a plaintiff’s appeal of several issues in a car accident lawsuit against their uninsured motorist carrier (UM). The case stemmed from a chain-reaction three-car accident. According to the court’s opinion, the driver of the first car made a sudden lane change and abruptly slammed on their brakes. This resulted in the second-car rear-ending the first car, and the third car, driven by the plaintiff, slammed into the second car. The driver of the first car received a citation and assumed liability.

Shortly after the accident, the plaintiffs sent a demand letter to their UM carrier. They requested full policy coverage but failed to include the husband’s medical records. After the UM requested additional information, the plaintiffs asserted their rights again, and included medical documentation. The UM carrier denied coverage, and requested several other pieces of information, including confirmation of the host vehicle’s coverage, tender of available coverage, and additional hospital records. Certain information indicated that the husband might have been mostly at fault for the accident. However, the plaintiffs advised the company that they would sue if the company did not pay the full benefits. The husband filed a Civil Remedy Notice (CRN), and a jury returned a verdict in favor of the plaintiffs, apportioning 90% fault on the first driver, and 10% on the husband. However, the court reversed jurisdiction to conduct a bad faith trial.

After an initial mistrial, both parties filed motions to preclude the admission of certain documents. The court granted the defendant’s motion to admit the parties’ mediation activity log. The defendants used the log to show that the plaintiffs initially wanted a $50,000 settlement instead of their current demand of $500,000. The husband argued that the log was inadmissible because it was confidential, irrelevant, violated the trial court’s orders, and would only inflame the passions of the jury.

Recently, an appellate court issued its opinion in a bad faith claim homeowners filed against their home insurance company. According to the court’s opinion, the homeowners filed a claim with their insurance company after suffering losses from Hurricane Irma. The insurance company investigated the claim and determined that the homeowners’ loss was $3,013.20. In response, the homeowners provided the insurance company with their public adjustor’s estimate of their losses. According to the insurance agreement, the insurer began the appraisal process. The policy contained provisions that either party could demand an appraisal if the parties failed to agree to the amount of loss. Further, the policy included a provision that homeowners could not file a lawsuit unless the parties fully complied with the policy’s terms.

The homeowners filed a civil remedy notice of insurer’s violation (CRN), alleging that the insurance company breached its duty to settle the claims in good faith. They argued that the company was given notice of the severity of the homeowners’ losses, and the opportunity to inspect the property. The homeowners contended that, despite this opportunity, the insurer failed to identify the full extent of losses. As such, they filed a complaint based on Florida’s bad faith statute.

Under Florida Statutes, section 624.155, policyholders maintain a civil remedy for an insurance company’s bad faith. The claim applies in situations that an insurer failed to act reasonably, honestly, and in good faith to settle claims. Florida law requires plaintiffs to provide the Florida Department of Financial Services and the insurer with written notice of a violation. The CRN notice must include specific statutory violations, relevant facts and policy provisions, and a statement asserting the plaintiff’s right to pursue a civil claim. The statuary requirements to a Florida bad faith insurance claim require the claimant establish that the insurer was liable for coverage, the policy holder’s damages, and compliance with the notice requirements. The statute does not bar an insured from sending a CRN before a determination of liability or damages.

Insurance companies play a vital role in most Florida car accident cases and are expected to abide by the terms of their policies faithfully. However, in many instances, insurance companies wrongfully deny claims, and Florida personal injury victims end up in lengthy and costly disputes. These disputes can take longstanding financial, physical, and emotional tolls on Florida car accident victims. Florida has several statutes and remedies in place to hold insurance companies liable for delaying or wrongfully denying claims. Floridians who are at a standstill with an insurance company should retain an experienced attorney to help them get their rightfully due damages.

Florida motorists typically purchase automobile coverage with the expectation that the company will provide them with financial protection if they are involved in an accident. Insurance companies must deal with their policyholders in “good faith” and with “fair dealing.” These terms mean that the insurance company must treat their policyholders fairly and carefully when determining the validity of a claim, and settle claims against the insured within the agreed-upon coverage limit. Insurance companies act in bad faith when they refuse to pay or settle a claim without a reasonable basis, fail to promptly and adequately investigate or defend a claim without justification, implement deceptive practices to avoid paying a claim, or refuse to offer the full value of a claim.

There are generally two types of Florida bad faith insurance claims, first-party and third-party claims. First-party insurance claims occur when a Florida motorist’s insurance company fails to address and pay a claim adequately. This typically occurs when a Florida driver evokes their policy’s underinsured or uninsured coverage.

The United States Tenth Circuit Court of Appeals recently published an opinion that reversed a lower court’s ruling in favor of the defendant, concerning the plaintiff’s claim that the insurer wrongfully delayed the payment of benefits for her personal injury claim. The appeals court’s reversal of the lower court’s granting of summary judgment to the defendant on this claim will result in the case going back down and proceeding toward a trial if the parties are unable to settle before that time.The plaintiff in the case of Peden v. State Farm had been seriously injured while riding in a car that was involved in a DUI accident, and she allegedly suffered damages in excess of the policy limits of the insurance held by the driver of the vehicle involved in the crash. Before filing suit, the plaintiff made a claim with the defendant, seeking compensation for her injuries, and she was paid the maximum amount under the driver’s bodily injury liability policy limit. She sought the balance of her damages through her own policy’s uninsured/underinsured motorist coverage, but her claim was denied.

The Plaintiff Files a Lawsuit to Enforce Underinsured Motorist Claim and Alleges Bad Faith by the Defendant

After her claim for underinsured motorist protection coverage was denied, the woman filed a personal injury lawsuit against the defendant in federal court to enforce the full benefits of the coverage. In addition to her claim for compensation related to the damages she suffered, she sought additional damages, as permitted under Colorado law, since the defendant denied her initial claim without good reason or even a proper investigation, forcing her to bring a claim that should not have been necessary. After the lawsuit was filed, the defendant paid out the full amount of coverage.

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Insurance companies can be difficult to deal with. Whether it is an aggressive representative trying to get an accident victim to settle a case for a low-ball amount or a claims adjuster denying a seemingly valid request for compensation, insurance companies are not known for their customer service. In fact, in many cases people have to turn to the courts to enforce their own insurance policy against the insurance company. That is exactly what happened in a recent case in front of the Florida Supreme Court.In the case, Fridman v. Safeco Insurance Company of Illinois, the plaintiff was hit by an underinsured motorist and turned to his own insurance company, Safeco, for help. However, Safeco denied the plaintiff’s claim. After continuing to try and get a response for several years, the plaintiff finally filed a lawsuit against Safeco, compelling them to deal with the claim. The lawsuit was filed pursuant to a statute that allowed for recovery in excess of the policy limit.

Shortly after the lawsuit was filed, Safeco sent the plaintiff a check for $50,000 in an attempt to pay out the claim. However, at this point the plaintiff rejected the check, and opted to have a jury determine how much he was entitled to. The case proceeded to trial, where a jury awarded the plaintiff $1 million. Safeco appealed to the intermediate appellate court, which reversed the lower court’s opinion, and held that the $50,000 check given to the plaintiff was, in effect, a settlement that prevented the case from proceeding toward trial. The plaintiff then appealed to the Florida Supreme Court.

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Florida’s First District Court of Appeal has found that a bad-faith medical malpractice insurance case should go to trial. In Samiian v. First Professionals Insurance Co., a doctor performed plastic surgery on a patient who remained at his clinic following the procedure. After visiting with the patient at the end of the day, the physician apparently left the man in the care of a surgical technician. The technician reportedly administered intravenous medication to the patient before the patient unexpectedly suffered a fatal heart attack. On the following day, the doctor notified his medical malpractice insurance carrier regarding the potential for a future lawsuit.

Soon afterward, the deceased patient’s estate filed a notice of its intent to file a lawsuit against the physician, pursuant to Section 766.106(2) of the Florida Statutes. The doctor’s insurer then retained an attorney to represent him. Following an investigation into the matter, the company decided to tender a settlement check for the doctor’s full insurance policy limits of $250,000 to the deceased patient’s personal representative. Two days after the check was delivered, the lawyer who was retained by the insurer offered to submit the matter of economic damages to binding arbitration. In his letter, the attorney stated the insurance company was not amending its offer to settle the case for the full medical malpractice policy limits. Despite this, the arbitration offer was not contingent upon a damages limit. After the estate accepted the offer to arbitrate, a panel of neutral arbitrators issued an award of over $35 million in favor of the deceased patient’s estate. The arbitral award plus interest was later confirmed by a Florida court and also upheld on appeal.

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The Middle District of Florida has denied a defendant’s motion for summary judgment in a bad faith insurance lawsuit. In Hines v. Geico Indemnity Co., a Florida woman apparently caused a motor vehicle collision while driving a car that was owned by her husband. At the time, the vehicle carried liability coverage with bodily injury limits of $25,000 per person and $50,000 per incident. Following the car accident, the wife was arrested for driving while intoxicated.

After the crash, the other motorist retained a lawyer to represent her in the case. The driver’s attorney then offered to settle her claim against the couple and their insurance company for the bodily injury policy limits of $25,000. The attorney also submitted medical and other evidence in support of the driver’s request for damages. The couple’s insurer responded by stating the driver’s personal injury protection coverage already paid her $10,000. In addition, the insurance company offered to pay the injured motorist $3,500 to resolve her claim.

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In Levesque v. Government Employees Insurance Co., a Florida woman sustained serious injuries in a car accident that was caused by an uninsured motorist. Following the crash, the woman sought uninsured motorist (“UM”) benefits from her automobile insurance provider. Since the insurance company failed to provide the woman with the full policy limits of $100,000 within 60 days of being provided with a Civil Remedy Notice of Insurer Violation, the woman filed a lawsuit against the company in a Florida state court. The insurer admitted the woman was entitled to recover the full policy limits and moved for entry of final judgment.

After procuring a final judgment against the auto insurer, the woman filed a statutory bad-faith case against the company under Section 624.155 of the Florida Statutes. In her lawsuit, the woman sought damages for the full value of her injuries from the insurance company. The insurer responded to the hurt woman’s complaint by filing a motion to dismiss or stay the case. According to the company, the woman’s action was premature because she failed to establish her total damages in her underlying UM lawsuit.

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