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Florida Enacts Broad Insurance Reforms Focusing on Bad Faith

From 2019 to 2022, the Florida Legislature enacted four separate property insurance reforms that sought to rein in abusive property insurance litigation fueled by one-way attorney’s fee shifting and an army of professional plaintiffs filing lawsuits pursuant to assignments of benefits. In its latest reform, the Legislature has shifted its focus to the broader insurance market and to tort reform. For many years now, Florida has significantly led the nation in tort costs per household.  This metric has been driven by a high octane litigation environment, ever growing personal injury verdicts, and a gradually sharpened focus on setting up insurers for bad faith claims. About The Authors

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Posted in Uncategorized

Florida Appellate Court Holds that Deadline to Report Claims Does Not Nullify Prompt Notice Provision

Florida’s Third District Court of Appeal recently affirmed a summary judgment entered in favor of a property insurer, holding that there is no conflict between the policy’s three year limitation for reporting hurricane claims and the requirement that the insured give prompt notice. In Navarro v. Citizens Property Insurance Corporation, No. 3D22-0032, 2023 WL 219032, — So.3d —- (Fla. 3d DCA Jan. 18, 2023), the insured sought coverage for Hurricane Irma damage nearly three years after the storm. The court found that the policy unambiguously required prompt notice, and that the insured failed to rebut the presumption of prejudice against the insurer.  About The Authors

Posted in Hurricane, Notice

Florida Begins New Era with Major Property Insurance Reforms

For the fourth time since 2019, the Florida Legislature has enacted property insurance reforms aimed towards stabilizing a beleaguered insurance market. The bill, S.B. 2-A, creates a reinsurance assistance program, establishes additional oversight for insurers with high volumes of hurricane claims, and reforms many aspects of the claims process, including the timing for paying and adjusting claims. The reforms further eliminate one-way attorney fee awards to policyholders and ban assignment-of-benefits agreements.  In this article, we will focus on the changes to the claim adjustment process and coverage and bad faith litigation. About The Authors

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Posted in Uncategorized

Florida Property Insurance Reform Round Three Brings Big Changes

For the third time since 2019, the Florida Legislature has enacted broad property insurance reforms with the goal of stabilizing the insurance market and curbing litigation filed by unscrupulous contractors. The bill, S.B. 2D, creates a reinsurance program, amends certain prohibited advertisement practices for contractors, permits issuance of personal lines policies with separate roof deductibles, and reigns in property insurance bad faith litigation and litigation by assignees. In this article, we will focus on the statutory changes that affect the handling and litigation of property insurance claims. About The Authors

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Posted in Uncategorized

True, False, or Simply Wrong? Florida Courts Disagree About Whether ‘False Statements’ Must Be Intentional

A Florida appellate court recently interpreted a “Concealment or Fraud” provision that voids coverage where an insured makes “material false statements” as requiring intentional deception, extending the split amongst the Florida appellate courts. In Vargas v. SafePointe Ins. Co., No. 3D19-1656, 2022 WL 108428 (Fla. 3d DCA Jan. 12, 2022), a homeowner reported a water loss to her property insurer following a plumbing leak. The insurer immediately requested repair invoices from prior claims and photographs of the pre-loss condition of the property. The homeowner, however, never provided this information. Instead, she submitted a sworn proof of loss with an itemized estimate. About The Author

Posted in Uncategorized

A Look Inside Florida’s Recent Property Insurance Reform

Two years after implementing meaningful assignment of benefits reform, Florida enacted broader property insurance claim reform. On June 11, 2021, Governor DeSantis sign S.B. 76, which takes effect on July 1, 2021. S.B. 76 focuses on reducing insurance claim litigation by, amongst other things, requiring timely notice of claims, curtailing certain solicitation practices used by roofing contractors, and limiting the circumstances in which attorney’s fees can be awarded to policyholders in property insurance lawsuits. About The Authors

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Posted in Property Insurance Reform

A Consequential Ruling: Florida Supreme Court Rejects Recovery of Consequential Damages in First-Party Breach of Contract Actions

In first-party breach of insurance contract actions, the parties oftentimes dispute whether the policyholder may seek damages that are not explicitly provided for in the policy, with the policyholder arguing such indirect damages flow from the alleged breach of contract. By doing so, policyholders blur the lines between breach of contract actions and bad faith actions. The Florida Supreme Court recently considered this issue in Citizens Property Insurance Corp. v. Manor House, LLC,[1]  and held that “extra-contractual, consequential damages are not available in a first-party breach of insurance contract action because the contractual amount due to the insured is the amount owed pursuant to the express terms and conditions of the insurance policy.” Manor House arose from a Hurricane Frances

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Posted in Hurricane

Correlation or Causation for Coronavirus-Related Business Income Losses

In the wake of the Coronavirus (COVID-19) pandemic, countless businesses have reduced or closed operations—some permanently. Flights have been canceled, hotels and restaurants have closed, and employees have been told to stay home. Naturally, businesses will seek to offset their financial losses during this period. Some businesses may file insurance claims under their Business Income coverage. Common Business Income (and Extra Expense) Coverage Forms might state: “We will pay for the actual loss of Business Income you sustain due to the necessary ‘suspension’ of your ‘operations’ during the ‘period of restoration’. The ‘suspension’ must be caused by direct physical loss of or damage to [covered] property ….” There has been much discussion of what constitutes “physical loss” and of policy

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Posted in Hurricane Ike, Uncategorized

Key Questions to Consider in Light of Operation Rubicon’s Investigation into Insurance Fraud in South Florida

Law enforcement in Miami-Dade County, Florida recently arrested nine individuals described by Florida Chief Financial Officer Jimmy Patronis as the “ringleaders of an elaborate fraud scheme” led by Barbara Maria Diaz de Villegas,[1] owner of the public adjusting company The Rubicon Group.[2]  The arrests were the result of a year-long investigation, known as “Operation Rubicon,” to investigate insurance fraud, and demonstrate that efforts are being made to curb insurance fraud in South Florida.  According to a February 2019 report from the Federal Trade Commission, Florida is ranked as the number one state for fraud and is home to 18 of the top 50 cities in the United States in terms of fraud reports.[3] The alleged fraud scheme involved public adjusters,

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Posted in Water

Florida’s “Assignment of Benefits” Bill: A Guide Through the New Statutory Framework

This week, after 7 years of failed efforts, the Florida Legislature passed a meaningful Assignment of Benefits (“AOB”) reform bill.  Florida Governor Ron DeSantis announced yesterday that he would sign the legislation designed to cut back on abusive AOBs, a practice that has plagued the hurricane-prone state. In recent years, many contractors have taken advantage of Florida’s unique one-way attorney’s fee shifting statute for insurance coverage litigation. This rule has incentivized contractors to, via the assignment of benefits mechanism, charge property owners outlandish amounts and to then pursue needless, sometimes frivolous, and always expensive litigation against insurance companies. Florida H.B. 7065, expected to take effect July 1, 2019, makes several key statutory changes designed to curb AOB practices. We discuss

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Posted in Assignment of Benefits
About The Property Insurance Law Observer
For more than four decades, Cozen O’Connor has represented all types of property insurers in jurisdictions throughout the United States, and it is dedicated to keeping its clients abreast of developments that impact the insurance industry. The Property Insurance Law Observer will survey court decisions, enacted or proposed legislation, and regulatory activities from all 50 states. We will also include commentary on current issues and developing trends of interest to first-party insurers.
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