Alyssa Lane
Florida's property insurance market is in crisis, with insurers facing mounting litigation costs and billions in losses from natural disasters. This has resulted in a rapid increase in policy cancellations and companies exiting the state. Homeowners in Florida have rights and recourses when dealing with insurance companies, including free mediation services and legal options. When facing litigation, homeowners can file a Notice of Intent to Initiate Litigation, which must be responded to by the insurer within 10 business days. If an insurance company is acting in bad faith, a policyholder may be able to file a lawsuit for a tort claim and breach of contract. Homeowners' insurance lawyers can help policyholders resolve disputes and hold insurance companies accountable for upholding their policies.
| Characteristics | Values |
|---|---|
| Florida's property insurance market | In crisis due to high litigation costs and losses from natural disasters |
| Florida's insurance consumer advocate's (ICA) view | Homeowners insurance options in Florida have become limited and consumers are facing dire consequences |
| Florida insurers | Cancelling policies, leaving the state, or liquidating rapidly |
| Florida's property insurance market crisis | Caused by high threat of weather-related damage and other factors |
| Homeowners' insurance lawyers | Litigate insurance dispute claims and hold insurance companies responsible for upholding the policy |
| Insurance companies' duty | Act in "good faith" and fulfill agreements |
| Insurance companies' actions | Delay payments, deny valid claims, undervalue losses, or refuse to pay for repairs |
| Policyholders' rights | File a lawsuit against the company for a tort claim and a breach of contract claim |
| Florida law on homeowners insurance | Does not require homeowners to carry insurance |
| Mortgage lenders' requirement | Likely to require a homeowners' insurance policy in the mortgage agreement |
| Homeowners insurance coverage | Property loss, certain damages, and liability claims |
| Florida homeowners' common claims | Hail and wind damage, water damage, fire and lightning damage, break-ins and theft |
| Timeframe for filing a claim in Florida | Four years from the date of the incident |
| Timeframe for insurance providers to acknowledge receipt of a claim in Florida | 14 days from the initial communication |
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What You'll Learn
Florida's insurance market is in crisis
The first factor is the state's history of hurricanes and severe weather. Florida has experienced more hurricanes than any other state, with Hurricane Ian causing $113 billion in damage, and Hurricane Helene and Milton causing billions more. The potential for hurricane damage is not a new issue, but the current hurricane season is expected to be much more severe than in previous years. This has made insurers wary of the Florida market, and coastal areas are now more difficult to insure than inland areas.
The second factor is the high levels of litigation in the state. A 2017 State Supreme Court decision allows courts to award plaintiff's attorneys two to two-and-a-half times their hourly billing rate when courts rule in favor of policyholders. This has resulted in soaring litigation costs for insurance companies.
The third factor is roofing scams, where contractors offer free inspections, claim to find damage, and then sue the insurance company without the homeowner's permission. This has caused insurance companies to tighten their underwriting restrictions and no longer want to cover homeowners with older roofs.
The combination of these factors has resulted in skyrocketing premiums, with Florida policyholders now paying nearly five times the national average. The crisis has also led to a reduction in the availability of insurance, with many homeowners unable to get coverage on the private insurance market and having to turn to state-backed Citizens Insurance. The situation is highly problematic, especially during the Atlantic hurricane season, and the Florida homeowners insurance market is on the brink of collapse.
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Homeowners can file a lawsuit against insurers for acting in bad faith
Homeowners in Florida can file a lawsuit against insurers for acting in bad faith. If an insurance company is acting in "bad faith", a policyholder may be able to file a lawsuit against the company for a tort claim and a breach of contract claim. A tort claim would provide the policyholder with punitive damages—court-awarded compensation that is more than the measurable value of the damages and intends to punish the wrongdoer for their conduct. If punitive damages are awarded, the policyholder may receive more than the original value of the policy.
Homeowners' insurance is designed to provide peace of mind, but insurance companies may deny valid claims, delay payment, undervalue a loss, or refuse to pay to have a problem fixed correctly. Insurance companies have a financial motivation to unreasonably delay payment or deny valid claims. They are required to uphold the policies they sell, and if they fail to do so, an insurance attorney may be able to help the policyholder obtain the benefits they pay for.
In Florida, if a party reaches the point of filing legal actions against an insurer related to a property insurance policy, they must first submit a Notice of Intent to Initiate Litigation. This is a legal process that is electronically sent to the insurance company immediately upon submission. The insurer must respond in writing within 10 business days.
If you believe your insurer has acted in bad faith, you should contact an experienced insurance attorney who can review the facts of your case and give you specific legal guidance for the claims process. Many attorneys provide free consultations. Proving bad faith requires establishing two things: that the insurer has withheld a benefit provided for in your policy, and that this decision was unreasonable or lacked proper cause under the terms of the policy or the law. It is important to document evidence of your dealings with your insurance company, including keeping records of any correspondence to help in reconstructing a timeline of events.
Some examples of behaviours that constitute bad faith practices include:
- Unreasonably delaying or refusing to pay a valid claim
- Failing to promptly investigate a claim
- Failing to maintain or follow reasonable standards when investigating a claim
- Failing to communicate with the policyholder about the status of a claim
- Intentionally misrepresenting basic facts about a homeowners insurance policy, including available benefits or limits of coverage
- Refusing to settle a valid claim with a third party or engaging in unreasonable delays during settlement negotiations
- Failing to properly explain its reasons for denying a claim
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Notice of Intent to Initiate Litigation must be submitted
In Florida, if a party wishes to file legal actions against an insurer related to a property insurance policy, they must first submit a Notice of Intent to Initiate Litigation. This is a legal requirement under Section 627.70152 of the Florida Statutes. The process applies exclusively to suits not brought by an assignee arising under a residential or commercial property insurance policy.
To file a Notice of Intent to Initiate Litigation, one must first create an account on the Notice of Intent to Initiate Litigation website. Once an account has been created, the user must sign in and click 'Create Notice'. All the required fields must be filled, and any necessary attachments must be uploaded. The user can then review their Notice and make changes if needed. After reviewing, the user can click 'Submit to File'. The Notice will be electronically sent to the Claimant and the designated contact for the Insurer. It is important to note that only PDF files can be attached to the Notice. Once submitted, no changes can be made to the Notice.
The insurer must respond in writing within 10 business days of receiving the Notice. The response must be sent to the email address provided. Any correspondence submitted to the Department via mail, email, fax, or any other means will not be included in the official record.
If one wishes to withdraw a Notice of Intent to Initiate Litigation, they can do so through the online system. The user must sign into their account and search for the Notice. There will be a "Withdraw Notice" button near the top of the online Notice. After clicking the button, the user must confirm by clicking "OK".
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Insurers must respond in writing within 10 business days
When a party reaches the point of filing legal action against an insurer related to a property insurance policy, they must first submit a Notice of Intent to Initiate Litigation. This is a legal process and the notice is electronically sent to the insurance company immediately upon submission.
To file a Notice of Intent to Initiate Litigation, you must first create an account and sign into the system. Then, click 'Create Notice' at the top and enter information into all the required fields. You can also upload any attachments that need to be included with the Notice. Only PDF files can be attached to a Notice of Intent to Initiate Litigation. Once you have reviewed your Notice, click 'Submit' to file or 'Edit' to make any changes.
Please note that once submitted, you cannot make any changes to the Notice. The user that created the Notice will need to sign into their online account and click the 'Withdraw Notice' button to withdraw it.
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Homeowners insurance covers property loss and certain damages
Homeowners insurance provides coverage for a range of possible damages and losses. This includes damage to the property itself, such as the main dwelling and other structures like garages, fences, driveways, and sheds. Personal property is also typically covered, including the contents of your home, such as furniture, appliances, clothing, and other valuable belongings. However, high-value items like jewellery or artwork may have limited coverage, and you may need additional coverage for these items.
Homeowners insurance also provides liability coverage, protecting you if someone is injured or their property is damaged while on your property. It can help cover medical bills and any legal claims that may arise from such incidents. Additionally, if your home becomes uninhabitable due to covered damage, your insurance may cover additional living expenses, such as hotel stays, rentals, and meals.
In terms of specific events, homeowners insurance typically covers a range of natural disasters, including lightning, thunderstorms, hail, hurricanes, and heavy wind. It also covers damage caused by falling objects, smoke, and burst pipes. However, most policies do not cover earthquakes, landslides, mudslides, or other natural movements of the earth. Flood damage coverage may also be limited or excluded. It's important to carefully review your policy to understand what is and isn't covered, as well as any limitations or exclusions.
Regarding your specific situation in Florida, it is essential to understand the laws and regulations surrounding homeowners insurance and litigation. In Florida, if you intend to initiate litigation against an insurer related to a property insurance policy, you must first submit a Notice of Intent to Initiate Litigation pursuant to Florida Statutes. This process is legally required and serves as a formal declaration of your intent to take legal action. The Chief Financial Officer receives and transmits this notice to the insurer. It's important to note that any changes to the notice cannot be made after it has been submitted. The insurer is required to respond in writing within 10 business days of receiving the notice.
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Frequently asked questions
Before filing a lawsuit, submit a Notice of Intent to Initiate Litigation. This is a legal process and the notice is sent to the insurance company immediately upon submission. The insurer must respond in writing within 10 business days.
If your insurance claim is denied, you can reach out to the insurer again and consider getting an independent appraisal or hiring an attorney. An insurance attorney can help protect your right to fair compensation.
Common reasons for insurance claims being denied include insufficient coverage, not meeting deadlines or paying premiums, falsifying information, poor documentation, and failing to secure homes from further damage.
Common claims filed by Florida homeowners include hail and wind damage, water damage, fire and lightning damage, break-ins and theft, and liability claims.
Homeowners in Florida have four years from the date of the incident to file a claim.
