Florida has been struggling to manage its insurance industry for years. The state has a serious problem with keeping both contractors and insurers honest. Too many homeowners get caught in the middle, struggling with unscrupulous insurers that prevent them from getting the funds they need to repair their property.
Unfortunately, Florida has not made bad faith claims easier. Recent laws and legal opinions have made it more complicated than ever for homeowners to fight back against insurers operating in bad faith. Here’s what you need to know about insurance bad faith in Florida, what the law requires you to do, and how you can make sure your insurer isn’t taking advantage of you.
What Is Bad Faith Insurance?
When you buy a home insurance policy, you’re forming a contract with your insurer. In that contract, you agree to pay certain monthly premiums in exchange for a promise that the insurer will cover the cost of repairing specific kinds of damage. If you both are operating in good faith, you will pay your premiums on time, and the insurance company will cover or reimburse you for covered damage when you need to file a claim.
Insurance companies are vigilant about ensuring every customer pays their premiums on time and do not hesitate to cancel their policies if they fail to make payments. However, unscrupulous insurers do not take the same pains to hold up their end of the contract. These companies may attempt to renege on the contract and fail to provide the promised coverage. This is known as bad faith insurance.
An insurer failing to cover what they promised can be financially devastating to the victim. You pay hundreds or even thousands of dollars a year for the promise that they will help you repair your property after it’s damaged. If it fails to fulfill the contract, not only are you stuck trying to pay for repairs to your home on your own, but you are also out the money you paid on premiums, which you could have used to make repairs yourself. If you do not challenge it, the insurer keeps those funds and avoids paying anything, helping the business make that much more money.
Taking a stand is crucial if you believe your insurer is trying not to hold up your contract. Holding insurers accountable for breaches of contract both helps you receive the funds you need to make repairs and discourages them from taking advantage of their customers in the future.
Florida Law Requirements for Bad Faith Insurance Claims
Bad faith in insurance is a significant problem, but it is not easy to solve on your own. In Florida, you must follow a strict and detailed process to file your claim or risk having your case dismissed entirely. Here’s how the process works under Florida insurance law:
- The claimant must file a clearly written and specific Civil Remedy Notice with the company and the Florida Department of Financial Services.
- The claimant must wait 60 days for the notice to “cure,” granting the insurer the opportunity to reach out and settle the complaint.
- If the insurer reaches out at that time, the claimant must attempt to negotiate a fair settlement.
- If no settlement is reached, the notice “cures,” and the claimant may file a lawsuit against the company.
Several issues with this process make it extremely difficult for an individual homeowner to successfully file a claim on their own. First, Civil Remedy Notices (CRNs) must meet specific standards and requirements to be considered sufficient. If a CRN is deemed insufficient, the Department of Financial Services does not have the authority to return it and request that it be improved. As such, homeowners are solely responsible for ensuring their CRN is accurate and sufficient or risk their claim never even being considered.
Second, the 60-day curing period leaves claimants struggling to cover emergency repairs for two months. The insurer can reach out any time during that period to offer a settlement, and some wait until the end only to offer an underpayment. If a homeowner is desperate, they may accept the funds just to get the matter over with, allowing the company to get away with underpaying them. In short, handling the process alone is unlikely to get you payment in full.
Benefits of Working With Experienced Bad Faith Insurance Attorneys
If you believe your insurer is acting in breach of contract, it is not in your best interest to try to take them on alone. Instead, you should consult an experienced insurance lawyer and secure legal representation for your dispute. Working with a qualified insurance lawyer allows you to:
- Submit an accurate and sufficient CRN the first time
- Avoid wasting time and potentially hitting the statute of limitations because of unnecessary revisions and resubmissions
- Negotiate a genuinely fair settlement if the insurer reaches out during the curing period instead of settling for whatever it offers you
- Hold the company accountable through bad faith insurance litigation if you do not reach a settlement during the curing period
At The Professional Law Group, we pride ourselves on helping our clients achieve the best possible results from their claims. We have years of experience and knowledge that we will use to guide you through the process of how to prove bad faith insurance.
We are dedicated to acting as vigorous advocates for our clients, helping them pursue fair compensation for their claims and holding insurers accountable for breaking their contracts. Learn more about how our proven insurance attorneys will assist you by scheduling your consultation with The Professional Law Group today.
