Eleventh Circuit Reverses Lower Court Decision in Bad Faith Insurance Claim

In a recent case, the United States Court of Appeals for the Eleventh Circuit issued an opinion in an appeal involving a bad faith claim in an insurance case under Florida law. The plaintiff-appellant was injured in a car accident and subsequently sued the defendant-appellee, USAA General Indemnity Company, for bad faith. At trial, after the parties had conducted discovery, USAA moved for summary judgment, which the district court granted. The court concluded that there was no genuine dispute as to the bad faith claim because USAA had, at most, acted negligently in handling the claim. While that alone was sufficient for summary judgment in the eyes of the district court, the court further concluded that no reasonable jury could find USAA’s conduct caused the plaintiff to obtain the excess judgment against the insured party because the evidence showed that the plaintiff’s lawyer never intended to settle the case, granting summary judgment. The plaintiff then filed a timely appeal.

The accident that triggered the case involved three drivers: the insured, the plaintiff, and a non-party. On July 29, 2017, the insured lost control of his van and struck the non-party. The collision caused the insured to veer into oncoming traffic, landing on top of the plaintiff’s vehicle. The plaintiff suffered catastrophic injuries, including a torn aorta and several broken bones. He was airlifted from the crash site to the hospital, where he remained in a medically induced coma in the ICU for ten days before spending an additional three weeks in the hospital and rehabilitation facilities. A few days after the accident, USAA warned the insured of the possibility of an excess judgment and then again on August 8 and in a letter on October 26. Additionally, USAA began to investigate the case by collecting statements, corresponding with the plaintiff’s attorney, and obtaining the police report. Eventually, USAA tendered the policy limits, offering to settle with the plaintiff in exchange for a release of liability. The plaintiff’s attorney never offered to settle or sent a counteroffer.

Following the district court’s granting of summary judgment, the plaintiff filed an appeal contending that the district court erred because a reasonable jury could find in his favor on both the elements of a bad faith claim. Bad faith claims under Florida law are made up of two elements: (1) bad faith conduct by the insurer, which (2) causes an excess judgment to be entered against the insured. The Eleventh Circuit opinion emphasizes the critical inquiry in a bad faith action is whether the insurer diligently, and with the same haste and precision as if it were in the insured’s shoes, worked on the insured’s behalf to avoid an excess judgment. Applying a totality of the circumstances analysis, the court was satisfied that there was a genuine issue of material fact as to whether USAA’s handling of the insured’s claim amounted to bad faith. The appellate decision first looked at the delay in initiating settlement negotiations. The court then points out the delay by USAA in providing information to the plaintiff and his attorney necessary to settle the case. Finally, regarding causation, the court found that a reasonable jury faced with the record could find that USAA caused, or at least contributed substantially, the entry of the excess judgment against the insured. The Eleventh Circuit reversed and remanded the decision to the lower court.

Has the Insurance Company Given You the Run-Around?

If you or someone you love has suffered harm in Florida, the personal injury lawyers at Friedman Rodman Frank & Estrada can help you understand your rights and the remedies available to you under Florida law. Our team of attorneys has successfully advocated for injured individuals throughout Florida for 46 years. Expenses from injuries or harm can quickly become overwhelming, and having an experienced roster of attorneys by your side can make a world of difference for your claim. Make sure that you make the most out of your claim and get the award that you deserve. Contact our team at 305-448-8585 to schedule a free and no-obligation initial consultation with a lawyer at our office.

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