Florida Bad Faith Insurance Dispute Over Delayed Appraisal Awards

The District Court of Appeal issued an opinion in favor of a homeowner’s in a Florida bad faith insurance dispute. According to the record, lightning struck the homeowner’s residence in July 2009, causing serious property damage. The owner filed a claim with his insurance provider, who determined the amount of loss and made payments over eight years. However, in 2017 the homeowner disputed the paid amount, and the insurance company invoked the appraisal provision. While the appraisal process was ongoing, the owner filed a notice of his intent to file a bad faith claim against the insurance company. Amongst several claims, the insurance company argued that the sixty-day cure period was tolled pending the appraisal award and payment cured the bad faith allegations.

Under Florida law, insurance companies maintain two distinct duties: contractual and statutory. As such, first, they must timely evaluate and pay benefits. In most cases, the insurance policy conditions dictate how the parties must proceed before an insurer fulfills a claim. For example, as is the case in this situation, the provider might maintain the right to invoke an appraisal.
Second, they must act in reasonably good faith in evaluating claims. If a party experiences damages by an insurance company’s failure to comply, they may pursue civil action against the company.

In this case, the insurance company contends that the cure period was tolled until the completion of the appraisal process. However, the amount the insurance company owes relates to their contractual duty, not their statutory duty to act in good faith. The company’s policy states that the payment is not due until the other party fulfills their condition precedent. However, an appraisal is not a condition precedent to the company fulfilling its obligation to evaluate the claim fairly.

Under Section 624.155, a bad faith claim is ripe when there has been :

  • A determination of the company’s liability coverage;
  • A determination of the policyholder’s damages; and
  • The policyholder complies with notice requirements.

The appeals court found that the insurance company’s policy provision withholding payment until the fulfillment of a condition precedent does not absolve the company of its duty to comply with 624.155. Ultimately the company did not cure the bad faith by invoking the appraisal process; as such, the court reversed and found in favor of the claimant.

Has Your Insurance Company Engaged in Bad Faith?

If your insurance company refuses to pay your claim, contact the Miami personal injury lawyers at Friedman Rodman Frank and Estrada to discuss your remedies. In addition to Florida bad faith insurance disputes, our office handles personal injury lawsuits stemming from traffic accidents, premises liability, product liability, and wrongful death. We understand how an unexpected catastrophe can change the trajectory of a person’s life, and we work to ensure that our clients recover the compensation the law entitles them. Contact our office at 877-448-8585 to schedule a free initial consultation with a Florida insurance attorney on our team.


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