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Florida Insurance Companies Have an Obligation to Act in Good Faith

Many people purchase insurance to protect against economic losses stemming from personal injury or property damage. In exchange for premiums, the insurance company must uphold its duties to the policyholder. The duties include providing coverage, paying valid claims, and adhering to the policy’s terms. Policyholders who believe their insurance company is violating their agreement may file a Florida bad faith claim against their insurer.

Insurance bad faith claims fall under first-party and third-party claims. Third-party bad faith insurance claims typically involve liability insurance. Bad faith claims occur when an insurer breached their duty to defend their policyholder and pay costs. Common examples of third-party insurance include, liability insurance, malpractice insurance, and commercial liability insurance. First-party insurance is a claim against a policyholder’s insurance company. Bad faith claims arise when a policyholder’s insurance company fails to pay a claim without an appropriate investigation or basis for a denial. This often includes claims against a health or homeowner’s insurance provider, but also in claims involving an accident with an uninsured or underinsured driver.

Under Florida law, a policyholder may file a first-party bad faith claim against their insurance provider. A lawsuit is appropriate if the insurer failed to engage in good faith by acting fairly and honestly towards its policyholder. For example, an appellate court recently issued an opinion in a homeowner’s appeal of a judgment in favor of their insurance company. In that case, a water supply line burst in the homeowners’ home. Following the burst, the homeowners’ filed a claim under their insurance policy. Their insurance company investigated the claim and tendered a payment the homeowners thought was insufficient. In response, the owners filed a civil remedy notice (CRN) alleging bad faith violations. They also asserted an amount that could cure the violations. The insurance company acknowledged the CRN, and the matter proceeded to appraisal. Following the appraisal, the company paid an amount less than the homeowners’ requested.

Florida provides for bad faith liability if the court determines the relationship between the insurer and insured, the extent of the policyholder’s damages, and if the appropriate notice was filed. In this case, the court reasoned that the insurance company did not make any attempts to settle the claim after the initial assessment. Further, the company did not pay the award until two months after the CRN’s cure period. Therefore, the court found that the homeowners can pursue their bad faith claim.

Has Your Insurance Company Engaged in Bad Faith?

If your insurance company is failing to pay your claim, contact the attorneys at Friedman Rodman Frank & Estrada, P.A. The attorneys at our law firm have a long history committed to successfully representing insurance policyholders in claims against insurance companies. In addition to Florida bad faith insurance claims, we represent clients in claims stemming from motor vehicle accidents, defective products, premises liability, nursing home abuse, medical malpractice, and construction accidents. We have collected significant amounts of damages from insurance companies, governmental entities, and negligent individuals for our clients. Contact our office at 877-448-8585, to schedule a free initial consultation with a member of our legal team.

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