Articles Posted in Insurance Issues

On March 24, 2023, Florida Governor Ron DeSantis signed a far-reaching tort reform bill into law. The new law enacts several major changes to the Florida negligence liability system, the standard for bad-faith insurance claims, and the use of contingency-fee multipliers when calculating attorneys’ fees. Each of these changes directly influences how plaintiffs are able to pursue their claims in Florida moving forward. The announcement of the changes triggered a rush to the courthouses with negligence lawsuits in advance of its effective date, suggesting that the bill will curtain the overall tort liability landscape throughout the state.

Modified Comparative Negligence

The headline of the changes enacted by the Florida tort reform bill is the statewide shift from a pure comparative negligence system to a modified comparative negligence system. Under the old pure comparative negligence system, a plaintiff could recover an amount in proportion to the defendants’ percentage of responsibility for the plaintiff’s injuries regardless of the plaintiff’s liability. In practice, that meant that if a defendant was 30% responsible for a plaintiff’s injuries, the plaintiff could recover 30% of the damages associated with the injury from the defendant, even if the plaintiff was 70% liable. Under the old system, the plaintiff had four years to file a negligence lawsuit.

Under the new system, a plaintiff is able to recover in proportion to the defendants’ percentage of responsibility only if the plaintiff’s own share of responsibility is 50% or less. Meaning that if a plaintiff is more than 50% liable, the plaintiff cannot recover from the defendant. Additionally, the plaintiff has two years to file a negligence lawsuit, not four.

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In a recent case, the Fourth District Court of Appeals in Florida issued an opinion in an appeal involving an insurance claim between an Appellant, the insurer, the Appellee, the insured. The insured sued the insurer seeking a declaration that she had Uninsured Motorist (UM) coverage following an accident. The jury found in favor of the insured because the insurer failed to obtain a written rejection. The trial court entered a partial final judgment for the insured. The insurer appealed, claiming that verbal waivers of UM coverage are allowed in Florida and that the insured had verbally rejected UM coverage over the phone. The appeals court affirmed the partial final judgment.

The insured then filed a fourth amended complaint, asserting a single bad faith claim based on the insurer’s denial of coverage due to an alleged verbal waiver, and also moved for punitive damages.

The case arose when the insured contacted the insurer over the phone to purchase auto insurance coverage. During the call, the insured declined UM coverage. The insurer told the insured that she would need to sign a rejection form. Days after the policy was purchased, but prior to the insured receiving the rejection form, the insured was involved in an accident. Nearly a month after the policy was purchased, the insurer mailed the insured a letter stating that because the insured had declined UM coverage, she had to fill out and return the UM coverage rejection form. The letter contained the following warning: “If you do not return the form in its entirety or we are unable to match it to your policy, UM coverage will be added to your policy.” The insured sued the insurer seeking a declaration that she had UM coverage.

In a recent case, the Third District Court of Appeals in Florida issued an opinion in an appeal involving an insurance claim between the Appellants, the plaintiff, and the Appellee, Citizens Property Insurance Corporation (Citizens). The plaintiff sued Citizens after a claim for hurricane damage he filed was denied by Citizens due to late notice. Citizens moved for summary judgment on the basis that the plaintiff failed to promptly report his claim. The trial court granted summary judgment, and the plaintiff appealed.

The plaintiff was issued a homeowners policy by Citizens. The policy expressly barred any hurricane claims filed outside of a three-year window. Additionally, the policy requires claimants to give prompt notice of damages for claims. In the aftermath of Hurricane Irma, the plaintiff’s home sustained interior and exterior damage to his residence. He retained a public adjuster, and two years and seven months after the storm, he reported a claim to Citizens. Citizens responded by denying the claim, stating that due to the length of time that had passed between the date of the loss and the date the loss was reported, Citizens considers the loss to be a late report claim. Citizens then assigned a field adjuster. According to the field adjuster’s report, due to the passage of time, he was unable to determine if the exterior or interior damages were the result of Hurricane Irma. Citizens requested photographs and documentary evidence from the public adjuster, without success, though the plaintiff did tender a written proof of loss. Citizens denied the claim, asserting late notice.

At trial, the plaintiff testified that he noticed leaks throughout his residence the day after the storm struck. He stated that he observed roof leaks and attempted to effectuate repairs using tar approximately one month after the hurricane. The next year, the plaintiff made more roof repairs, including tile replacement, but did not report damages to Citizen. The plaintiff cited a lack of fluency with the terms of his policy as the reason why he did not report the damage at the time.

Florida residents and homeowners know very well that they and their properties exist comfortably at the whim of Mother Nature, whose destructive forces can cause problems on short notice. As the 2022 hurricane season comes to a close, many Florida residents are addressing maintenance and repair needs caused by the tropical weather. Floridians may purchase homeowner’s insurance, renter’s insurance, and federal flood insurance to protect themselves and their properties in the event of a weather-related disaster. The Florida Court of Appeal recently addressed a plaintiff’s water damage claim with their homeowner’s insurance company, which was previously rejected based on alleged fraud.

According to the facts discussed in the recently published opinion, the plaintiff purchased a homeowner’s insurance policy for her Orlando home from the defendant in May 2016. In April 2017, the plaintiff’s home was damaged in a storm, and she made a claim with the defendant to cover the damages. The plaintiff was offered a settlement of her claim that was not sufficient to cover her losses, and she pursued a breach of contract claim against the defendant to cover all of her losses. In investigating the plaintiff’s claim, the defendant discovered that a home inspection was completed in 2015, and the plaintiff did not disclose that the inspection found roof damage and water damage in the home before the plaintiff purchased the policy.

After discovering the inspection report, the defendant sought to deny the plaintiff’s claim and responded as such to the court. The trial court agreed that the plaintiff materially misrepresented the condition of the home when purchasing the policy, ruling that such misrepresentation invalidated the plaintiff’s claim of new water damage. The court threw out the plaintiff’s claim before a jury was even selected for trial. The plaintiff appealed the case resolution to the Florida Court of Appeal. The appellate court agreed with the plaintiff that for a homeowners insurance policy to be invalidated based on misrepresentation or fraud, the insured must intend to mislead the insurance company. Such intent is a fact judgment, that should be determined by the jury at trial. As a result of this finding, the court ruled that the trial court was not justified in disposing of the plaintiff’s claim. The trial court ruling was reversed, and the case will be remanded to proceed toward settlement or a trial on the plaintiff’s claims.

Accident victims in Florida who have worked with insurance companies probably understand how difficult it can be to get an insurance company to honor a claim. While insurance companies are notorious for making the claims process cumbersome and difficult, they still hold a duty to negotiate and attempt to settle a claim in good faith. A federal appellate court recently reversed a jury verdict that was in favor of an insurance company because the jury had not been properly instructed considering the good faith requirement.

According to the facts discussed in the appellate opinion, the plaintiff in the recently decided case is a man who was injured several years ago in a motorcycle accident. The plaintiff retained a personal injury attorney shortly after the accident, but communication was spotty between his counsel and the defendant. Months later, the plaintiff’s counsel sent a settlement offer to the defendant. The defendant did not communicate with their client about the settlement offer, and the plaintiff sued the driver and policyholder personally, obtaining over a $12 million verdict at trial.

After the initial trial, the plaintiff sued the insurance company directly, seeking to collect the $12 million judgment from them. The plaintiff argued that the defendant failed to act in good faith when considering the settlement offer, as required under Florida law. Specifically, the plaintiff alleged that the defendant’s failure to consult or advise their client of the settlement offer, or the consequences of a much larger trial verdict, constituted bad faith. After the parties presented their cases at trial, the plaintiff proposed a jury instruction explaining the requirements for a finding of bad faith, but the trial court rejected the instruction. The jury returned a verdict in favor of the defendant, and the plaintiff appealed the jury instruction issue to the U.S. Court of Appeals.

Dealing with the preventable death of a loved one is one of life’s most challenging burdens. Under Florida’s wrongful death statute, individuals or entities who acted negligently or recklessly in causing another’s death may be liable for the damages they caused. The state’s statute allows the deceased person’s survivors a mechanism to secure compensation for the death of their family members. However, these cases require a comprehensive understanding of the state’s complex evidentiary and procedural laws. An experienced Florida wrongful death attorney can represent family members in their wrongful death claims.

A recent Florida wrongful death appeal highlights the onerous burdens that many plaintiffs encounter when pursuing these cases. The Third District Court of Appeal issued an opinion addressing the dismissal of a wrongful death complaint involving an uninsured motorist. According to the record, the uninsured motorist collided with another motorist, rendering that motorist permanently disabled. After several years of litigation, the motorist died by suicide.

As the personal representative of the motorist’s estate, the motorist’s brother brought a wrongful death lawsuit against some of the motorist’s former attorneys. According to the complaint, the brother alleged that the attorneys’ negligence and legal malpractice were the proximate cause of his brother’s death. Specifically, the plaintiff argued that the attorneys’ failure to render reasonable care and professional skill prevented him from having the ability to pay for treatment and medication and caused him to experience pain and suffering that ultimately led to his suicide.

Following a major car accident, it may be obvious who was at fault and who caused the accident. Sometimes, however, car accidents are not as clear cut. In accidents with complex timelines, multiple parties, and conflicting testimony from witnesses and those involved, it can often become messy very quickly to handle the details of who was at fault, for how much fault, and other important elements of the accident timeline.

According to a recent local news report, a major accident left nine individuals injured and one killed. Local authorities reported that a van carrying three adults and four children with special needs was traveling through an intersection when it crashed into the side of another vehicle going in another direction through the intersection. The initial accident caused three other vehicles nearby to be impacted also. Local fire rescue authorities reported nine people, including six children—four of which have special needs—injured. These injured individuals were transported to the hospital, with some of the adults being issued trauma alerts. A 36-year-old woman who was also a passenger in the van was pronounced dead on the scene. The accident remains under investigation by troopers.

Florida, like some other states around the country, is called a “no fault” state. This means that Florida has a law requiring that all drivers have a specific type of car insurance coverage that pays regardless of who was at fault for the accident.

The District Court of Appeal in Florida issued an opinion in an appeal stemming from an insurance dispute between an insurance company and the insured. The insurance company appealed a final judgment against them after a lower court found that the insured’s material breach of the contract was immaterial.

According to the record, storm damage prompted the homeowner to file a claim with the insurance company. The insurance company argued that the policy bars the homeowner from filing suit because he failed to comply with the three post-loss conditions in the insurance contract. Specifically, the violations include the homeowners’:

  1. Failure to provide the insurance company with prompt notice of the loss.

An appellate court recently issued an opinion in a bad faith insurance lawsuit stemming from an accident between an 18-year-old driver and a motorcyclist. The accident occurred when the 18-year-old turned into a median in front of the biker. The biker slammed into the driver’s car with such force that the vehicle spun 180 degrees. The biker suffered serious injuries from the collision and was airlifted to a hospital.

The 18-year-old was driving his mother’s car at the time of the accident, and when he called the insurance company, he reported property damage but neglected to report any physical injuries. The insurance company interviewed the driver, who disclosed that the biker suffered injuries, and he indicated that the biker might have been speeding. The preliminary insurance investigation revealed that the accident occurred in a low-speed limit area, the motorcycle left long skid marks, and the driver did not receive a citation. With these facts, the insurance company concluded that the biker was likely contributorily negligent.

About ten days after the accident, the insurance company decided to tender the bodily injury limits to the biker; however, they asked the biker’s attorney if they could inspect the motorcycle. The next day the insurance company delivered a “tender package” to the biker’s attorney. The package included a cover sheet and described the content of the delivery, which included a $50,000 check and a form that released the company of “all claims.” The letter invited the biker’s attorney to edit the release or suggest changes to a release. The biker’s attorney did not address the release but rejected the offer stating the insurance company was trying to take advantage of the biker and his family by including an overbroad release.

An appeals court recently issued an opinion stemming from a Florida car accident between an insured and an uninsured motorist. The insured purchased non-stacking uninsured motorist coverage from their insurance company. After suffering injuries in an accident with an uninsured motorist, the insured sought to receive benefits of a stacking coverage policy. The woman filed a lawsuit against the insurance company after the company refused to cover the woman under the more comprehensive policy.

The record indicates that the woman’s boyfriend purchased an insurance policy that provided bodily injury and uninsured motorist coverage up to $25,000 per person. During the renewal period, the boyfriend rejected the non-stacking coverage, and the Office of Insurance Regulation approved the form. The policy states that there is no coverage for an insured who sustains bodily injury while occupying a vehicle owned by the policyholder or any resident relative if it is not in the policyholder’s car—the policy applied to the woman and her boyfriend and their Ford pickup truck. The two suffered injuries while operating a motorcycle that the insurance company did not insure.

On appeal, the court reviewed the insurance policy by looking at its plain language. Generally, exclusion provisions are more strictly construed than coverage provisions and tend to be interpreted in favor of the policyholder. However, courts cannot rewrite contracts or add intentions or meaning that are not present. Ambiguities exist when a provision is open to more than one reasonable interpretation. A court cannot deem a contract ambiguous just because it is complex or requires an in-depth analysis.

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