Blog Archives

Florida Court Holds Rust and Corrosion is “Act of Nature”

A Florida court recently held that rust and corrosion of water pipes is an “act of nature,” and, thus, was excluded from coverage under a homeowner’s insurance policy. In Dodge v. People’s Trust Insurance Company, 2021 WL 2217299 (4th DCA Jun. 2, 2021), Florida’s Fourth District Court of Appeals defined “act of nature” as a naturally occurring force that does not require an uncontrollable or unpreventable event. About The Authors

Tagged with: , , , , , , , , , , ,
Posted in Act of Nature

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

Tagged with: , , , , , , , , , , , , , , , , , , , ,
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

Tagged with: , , , , , , , ,
Posted in Hurricane

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,

Tagged with: , , , , , ,
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

Tagged with: , , , , , , , ,
Posted in Assignment of Benefits

Eleventh Circuit Holds Attorneys’ Fees Are Not Warranted Where Policyholder Filed Suit Instead of Undergoing Appraisal

The Eleventh Circuit, in J.P.F.D. Investment Corp. v. United Specialty Insurance Co., recently affirmed a district court’s denial of statutory attorneys’ fees to a policyholder that, to resolve a disagreement over the amount of loss, filed suit against its insurer instead of participating in appraisal.[1] In Florida, policyholder attorneys are often quick to file lawsuits against insurers in order to trigger statutory fee shifting. Florida Statutes § 627.428 provides: (1) Upon the rendition of a judgment or decree by any of the courts of this state against an insurer and in favor of any named or omnibus insured or the named beneficiary under a policy or contract executed by the insurer, the trial court . . .  shall adjudge or decree

Tagged with: , , , , , , , , , , , , ,
Posted in Water

Florida Court Rejects Claim Replacement Of Undamaged Property Is Necessary For Aesthetic Uniformity

Late last week a federal court in Florida tossed a condominium association’s claims that it was entitled to replace undamaged hallway carpeting, wallpaper, baseboards, and woodwork in order to “achieve aesthetic uniformity” with similar hallway components replaced after water damage.  In Great Amer. Ins. Co. v. Towers of Quayside No. 4 Condominium Ass’n., 2015 U.S. Dist. LEXIS 150358, 2015 WL 6773870 (S.D. Fla., Nov. 4, 2015), the court held that replacing undamaged property to insure “matching” is only appropriate if the repairs concern “a continuous run” of items such as that. The policyholder owned a 25-story condominium building in Miami.  There was a tiled elevator landing on each floor separating the east and west hallways, and those portions of the

Tagged with: , ,
Posted in Direct Physical Loss or Damage, Valuation, Water

Florida to Decide What Test Applies When Concurrent Multiple Perils Cause a Loss

For years, Florida courts have been seesawing between two different doctrines to determine whether there is coverage under a property policy when two perils – one excluded and one included — combine to cause a loss.  Two districts of the state’s intermediate level appellate court have applied one test and a third has applied another, with the most recent decision being American Home Assur. Co. v. Sebo, 141 So.3d 195 (Fla.Ct.App., Sep. 18, 2013).  On October 7th of last year, the state’s highest court accepted review in the Sebo matter, and oral argument was conducted on September 2, 2015.  Some clarity will finally emerge in the Sunshine State with respect to this issue. When multiple perils combine to cause a

Tagged with: , ,
Posted in Anti-Concurrent Causation, Efficient Proximate Cause, Faulty Workmanship or Design, Homeowners Coverage, Hurricane Wilma, Water

Eleventh Circuit: Sinkhole Loss in Florida Must Impair the Property’s Structural Integrity to be Covered

Effective in 2005, Florida statutes defined “sinkhole loss” to mean “structural damage to the building, including the foundation, caused by sinkhole activity,” and they left the all-important term “structural damage” undefined.  Homeowner’s policies issued in the state employed that formulation until May 17, 2011, when Florida adopted a much narrower five-part definition of structural damage that applied to policies affording coverage for sinkhole loss, and many courts construing the 2005 language held that the term “structural damage” meant nothing more than “damage to the structure.”  Several weeks ago in Hegel v. First Liberty Ins. Corp., 778 F.3d 1214 (11th Cir., Feb. 27, 2015), a unanimous Eleventh Circuit panel held: (1) that defining structural damage to mean any “damage to the

Tagged with: , ,
Posted in Direct Physical Loss or Damage, Homeowners Coverage, Sinkhole

Florida Court Holds Arson is a Type of Excluded Vandalism and Malicious Mischief

Earlier this month a unanimous Florida appellate court joined a number of other states that have held that an all-risk policy exclusion for vandalism and malicious mischief operates to bar coverage for an arson loss.  The opinion can be found at Botee v. Southern Fid. Ins. Co., 2015 WL 477836, 2015 Fla. App. LEXIS 1566 (Fla.Dist.Ct.App., Feb. 6, 2015). The insured, Raziya Botee, owned a single-family home that was destroyed by an arsonist on October 10, 2012.  It was undisputed that the structure had been vacant for over a month when the fire broke out.  Her homeowner’s insurer, Southern Fidelity (SFIC), denied liability because the contract of insurance excluded coverage for losses caused by “vandalism and malicious mischief, theft or

Tagged with: ,
Posted in All Risk, Ambiguity, Arson, Exclusions, Fire, Vacancy and Unoccupancy, Vandalism
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.
Subscribe For Updates

propertyinsurancelawobserver

Topics
Cozen O’Connor Blogs