Making a first party insurance claim is not always the only or even the best option available to a person or corporation whose property has been damaged by wind or rain. (A first party claim is made by a policy holder to his or her own insurance company. These claims are contractual; meaning that they arise out of a contract (the insurance policy) between the insurance company and the policy holder.)

Most first party property damage insurance policies have a deductible. (Deductibles are the amount an insured must pay before the insurance company becomes responsible for making payments under the policy. The deductible amounts can range from $250 to thousands of dollars.)

Making a first party claim may also result in a premium increase. (An insurance premium is the amount of money that an individual or business must pay for an insurance policy.)

Whether the property owner has an alternative to the first party claim depends on the cause of the damage. For example, a manufacturing defect or improper installation may account for a roof leak. In these instances, the better option may be to seek compensation from the responsible third party. The downside to this avenue of recourse is the time, delay, and expense of having to prove fault and damages against a party that is likely to be more hostile than the first party carrier.

One factor that motivates the first party carrier to being more agreeable than a third party is Florida Statute 627.428. This valuable statute assesses attorney’s fees against the first party carrier when it loses a legal dispute against the insured. It is not unusual in such disputes for the attorney’s fees to exceed the amount of the claim. This makes first party carriers think long and hard before getting into a legal tussle with an insured. Another motivating factor is that the first party carrier can go against the third party for reimbursement through a legal mechanism known as subrogation.

Many other factors come into play in making these decisions. For example, construction defect claims are subject to a 10-year statute of repose that requires a lawsuit be brought within 10 years of the occurrence of certain events. Section 95.11(3)(c), Florida Statutes.

Given the numerous variables in dealing with property damage claims, many of them consequential, it is advisable to seek the counsel of an experienced lawyer before making a decision.

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Contact us toll free at 866-785-GALE or by email to learn your legal rights.

Jeffrey P. Gale, P.A. is a South Florida based law firm committed to the judicial system and to representing and obtaining justice for individuals – the poor, the injured, the forgotten, the voiceless, the defenseless and the damned, and to protecting the rights of such people from corporate and government oppression. We do not represent government, corporations or large business interests.

While prompt resolution of your legal matter is our goal, our approach is fundamentally different. Our clients are “people” and not “cases” or “files.” We take the time to build a relationship with our clients, realizing that only through meaningful interaction can we best serve their needs. In this manner, we have been able to best help those requiring legal representation.

Every property damage insurance policy issued in Florida requires the insured to provide the insurance company (or, in some instances, the procuring policy agent) with timely notice of a loss. The notice requirement enables the insurer to conduct a timely and adequate investigation of all circumstances surrounding an accident. Bankers Insurance Company v. Macias, 475 So.2d 1216 (Fla. 1985). Many a claim has been denied for failing to meet the notice requirement.

Unless the terms of a policy run afoul of statutory or case law, they will govern the relationship between the insured and the insurer. This includes responsibilities with regard to loss reporting.

The reporting requirements can vary from policy to policy. This makes it advisable to read the insurance contract upon purchase and after a loss. The words “immediate” and “prompt” are commonly used to establish the reporting parameters.

While policy reporting requirements should not be taken lightly, breaching the policy’s strict language is not always fatal to maintaining coverage. First, case law allows for a consideration of the circumstances. For example, an insured prevented from getting home for an extended period of time after evacuating for a hurricane will be given more time to report a loss than an insured whose AC unit caused water loss.

Even if, however, the notice provision is breached, while prejudice to the insurer will be presumed, it may be rebutted by a showing that the insurer has not been prejudiced by the lack of notice. See National Gypsum Co. v. Travelers Indemnity Co., 417 So.2d 254 (Fla. 1982). See also Nationwide Mut. Fire Ins. Co. v. Beville, 825 So.2d 999, 1004 (Fla. 4th DCA 2002) (“Unless the carrier was prejudiced by the insured’s violation of the notice provision, the carrier could not avoid its duty to provide coverage for the expenses.”). Clearly, the burden is “on the insured to show lack of prejudice where the insurer has been deprived of the opportunity to investigate the facts.” Macias, 475 So.2d at 1218. Whether the presumption of prejudice to the insurer has been overcome is “ordinarily … a separate issue of fact.” Gonzalez v. U.S. Fid. & Guar. Co., 441 So.2d 681, 681 (Fla. 3d DCA 1983). Before the trial court should grant summary judgment, the record on such a motion should “conclusively foreclose[]” the insured’s “ability to overcome the presumption [of prejudice].” Robinson v. Auto Owners Ins. Co., 718 So.2d 1283, 1285 (Fla. 2d DCA 1998).

The lesson to be learned from this blog is that while the insured should make every effort to report a loss timely, the failure to do so does not always prove fatal to bringing a successful claim.

Our law firm accepts property damage cases on a contingency fee basis. This means that harmed property owners can retain our services without having to pay any up-front attorney’s fees or costs.

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Contact us toll free at 866-785-GALE or by email to learn your legal rights.

Jeffrey P. Gale, P.A. is a South Florida based law firm committed to the judicial system and to representing and obtaining justice for individuals – the poor, the injured, the forgotten, the voiceless, the defenseless and the damned, and to protecting the rights of such people from corporate and government oppression. We do not represent government, corporations or large business interests.

While prompt resolution of your legal matter is our goal, our approach is fundamentally different. Our clients are “people” and not “cases” or “files.” We take the time to build a relationship with our clients, realizing that only through meaningful interaction can we best serve their needs. In this manner, we have been able to best help those requiring legal representation.

Most homeowner and commercial residential insurance policies obligate policyholders to participate in a potentially expensive and time-consuming adversarial appraisal procedure before litigation. Here’s an example, from Allstate Insurance Company v. Suarez, 833 So. 2d 762 (Fla. 2002), of a typical contractual appraisal provision:

Appraisal. If you and we fail to agree on the amount of loss, either party may make written demand for an appraisal. Upon such demand each party must select a competent and impartial appraiser and notify the other of the appraiser’s identity within 20 days after the demand is received. The appraisers will select a competent and impartial umpire. If the appraisers are unable to agree upon an umpire within 15 days, you or we can ask a judge or a court of record in the state where the resident premises is located to select an umpire. The appraisers shall then determine the amount of loss, stating separately the actual cash value and the amount of loss to each item. If the appraisers submit a written report of an agreement to us, the amount agreed upon shall be the amount of loss. If they cannot agree, they will submit their differences to the umpire. A written award by any two will determine the amount of loss.

Cognizant of this daunting burden, the Florida Legislature enacted statute 627.7015, which provides an alternative procedure for resolving disputed property insurance claims. The essential elements of the statute are:

• It is available before commencing the appraisal process (or before commencing litigation).
• It may be requested only by the policyholder, as a first-party claimant, or the insurer.
• The insurer shall bear all of the cost of conducting mediation conferences.
• All statements made and documents produced at a mediation conference are inadmissible to prove liability or absence of liability for the claim or its value at subsequent hearings on the claim. See s. 90.408, Florida Statutes
• If a written settlement is reached, the insured has 3 business days within which to rescind the settlement unless the insured has cashed or deposited any check or draft disbursed to the insured for the disputed matters as a result of the conference. If a settlement agreement is reached and is not rescinded, it shall be binding and act as a release of all specific claims that were presented in that mediation conference.
• If the insurer requests the mediation, and the mediation results are rejected by either party, the policyholder is not required to submit to or participate in any contractual loss appraisal process of the property loss damage as a precondition to legal action for breach of contract against the insurer for its failure to pay the policyholder’s claims covered by the policy. (NOTE: If the insured requests the mediation, and the mediation results are rejected by either party, either side can demand participation in the appraisal process.)

Other key considerations:

• At the time a first-party claim within the scope of the statute is filed by the policyholder, the insurer shall notify the policyholder of its right to participate in the mediation program under this section. If the insurer fails to notify a policyholder of its right to participate in the mediation program, the policyholder is not required to submit to or participate in any contractual loss appraisal process of the property loss damage as a precondition to legal action for breach of contract against the insurer for its failure to pay the policyholder’s claims covered by the policy.
• If an insured fails to appear at the conference, the conference shall be rescheduled upon the insured’s payment of the costs of a rescheduled conference.
• If the insurer fails to appear at the conference, the insurer shall pay the insured’s actual cash expenses incurred in attending the conference if the insurer’s failure to attend was not due to a good cause acceptable to the department.
• An insurer will be deemed to have failed to appear if the insurer’s representative lacks authority to settle the full value of the claim. (This does not mean that the representative must pay the full value of the claim. It only means that the representative must have the authority to pay the full value if he or she so decides. This is a common point of confusion concerning mediation.)
• The insurer shall incur an additional fee for a rescheduled conference necessitated by the insurer’s failure to appear at a scheduled conference.

We have participated in many of these mediations. Most have resolved favorably. If there is a reasonable expectation leading up to mediation that the case may settle, the parties are well advised to come prepared with the evidence supporting their respective positions. This is because neither side will be inclined to accept the other side’s unsubstantiated claims. Solid evidence includes repair/replace estimates and photographs. If, on the other hand, it is apparent beforehand that the dispute gap will be too wide to overcome at mediation, the wise strategy may be to play matters closer to the vest. These are judgment calls the seasoned attorney will make on a case by case basis.

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Contact us toll free at 866-785-GALE or by email to learn your legal rights.

Jeffrey P. Gale, P.A. is a South Florida based law firm committed to the judicial system and to representing and obtaining justice for individuals – the poor, the injured, the forgotten, the voiceless, the defenseless and the damned, and to protecting the rights of such people from corporate and government oppression. We do not represent government, corporations or large business interests.

While prompt resolution of your legal matter is our goal, our approach is fundamentally different. Our clients are “people” and not “cases” or “files.” We take the time to build a relationship with our clients, realizing that only through meaningful interaction can we best serve their needs. In this manner, we have been able to best help those requiring legal representation.