Policyholders who pay their premiums on time expect their insurance company to abide by the terms of their insurance policy. However, many insurance companies prioritize their financial standing over the well being of their policyholders. When an insurance company fails to engage in good faith, they may be liable under Florida’s bad faith insurance laws. Insurance bad faith occurs when an insurance company violates its statutory duty to engage in good-faith resolution of an insurance claim. This includes failing to reasonably evaluate the merits and resolve a claim in favor of the insured.
Recently, a Florida appellate court issued an opinion stemming from an insurance company’s failure to settle a claim. The policyholders purchased coverage from an insurance company and evoked coverage when a water line burst in their home. After reviewing the claim, the insurance company subtracted the insureds’ deductible and issued a $43,708 payment. The policyholders filed a Civil Remedy Notice (CRN) arguing that the insurance company violated their insurance agreement because they did not identify the necessary repairs and instead gave a “low ball offer”.
Under Florida Law, a CRN is a requirement for those who are beginning the process of filing a claim against an insurer. The insurer must provide notice to the insurance company and the Department of Financial Services (DFS). The policyholder must expressly state the facts that gave rise to the violation. In some cases, a policyholder may provide the insurer with a monetary amount to “cure” the violation.
In this case, the policyholders filed the CRN, and the insurance company reviewed the estimate and invoked an appraisal. However, the insurance company did not make any additional efforts to resolve the claims. The insurance company argues that because they paid the appraisal award, the CRN violations were cured, thereby eliminating the basis of the bad faith action. The court rejected this argument, finding that insurers maintain an independent duty to evaluate a claim before determining damages. Thus, the inquiry in bad faith claims is not whether the insurer paid the amounts; instead, it is whether they acted reasonably in evaluating the claim before a damages determination. Here, the insurance company’s invocation of the appraisal or payment did not cure their bad faith. Therefore, the court reversed the trial court’s findings and allowed the policyholders to pursue their action against the insurance company.
Are You Looking for a Florida Bad Faith Insurance Attorney
If you believe that your insurer is engaging in bad faith, you should contact the Law Offices of Robert Dixon. Our law firm attorneys have experience handling complex lawsuits against insurance companies, negligent individuals, and governmental entities. We represent plaintiffs in claims stemming from Florida bad faith insurance claims, motor vehicle accidents, defective products, premises liability, medical malpractice, birth injuries, and nursing home abuse. Our experienced attorneys are an invaluable resource in determining your rights and remedies in these situations. We have recovered significant amounts of compensation on behalf of our clients. Contact our office at 877-499-4878 to schedule a free initial consultation with a Florida accident attorney at our law firm.