You pay your insurance company for peace of mind, assuming that any accidents covered under your policy will be paid for by them in full. However, sometimes an insurer refuses to pay a claim unreasonably. Or fails to conduct an appropriate investigation. Or unreasonably delays investigation.
When these things happen, it is possible that your insurer may be acting in bad faith. That’s the bad news. The good news is that bad faith is illegal, and you may be able to hold your insurer liable for damages.
Under Florida law, policyholders have to go through the regular process before doing this, including waiting until the insurance company conducts an appraisal. In bad faith claims involving unreasonable delays in investigation, this has made filing suit very difficult for policyholders, often forcing them to live with unrepaired damages for months – or even years.
However, a recent case may signal that things are changing. Florida courts just ruled that a policyholder did not need to wait until an appraisal had been conducted to seek damages. This sets a new legal precedent, and may allow other Floridians to receive bad faith damages prior to the appraisal.
Let’s take a look at the case in question, as well as how this may change bad faith insurance law — and how you, the policyholder, could benefit.
Philip Landers v. State Farm Florida
In 2009, Florida resident Philip Landers sustained suspected sinkhole damage to his home and filed a claim with his insurer, State Farm Florida Insurance Co. The insurance company made initial repairs, but Landers hired an independent evaluator who advised that the repairs were insufficient.
After a protracted legal battle, Landers ultimately sued State Farm in 2014 for acting in bad faith, stating that the company had delayed paying policy limits until after appraisal. The court initially ruled in favor of State Farm, but Landers appealed to the Fifth District Court of Appeal.
The appeal court reversed this ruling, finding that the purpose of a civil remedies notice (CRN) is to encourage good-faith efforts to settle claims in a timely manner prior to litigation, not to vindicate further efforts to delay. Further, the court found that filing a CRN prior to appraisal did not make the CRN null and void, and that nullifying the CRN perturbs the purpose of the statute by further delaying the time necessary to assess and pay out claims.
Previous Policy and Why the Landers Case Matters
Here’s why the Landers case matters. Quite simply, it could pave the way to a more streamlined bad faith process. Previously, insurance companies were allowed to request an appraisal in the event of a bad faith suit and/or CRN, delaying any further action until the appraisal had been performed, and nullifying CRNs.
Because many bad faith insurance suits involve delays in investigation and repairs, this policy often frustrated the efforts of policyholders trying to seek justice. However, the Landers case sets a new precedent, allowing policyholders to file CRNs and bad faith insurance suits and seek damages prior to the insurer conducting an appraisal.
If You Have Suffered from Bad Faith Insurance
If you believe that your insurance company has acted in bad faith by failing to pay out claims for covered events or unreasonably delaying investigations, you may have a case for bad faith insurance.
You have likely paid your premium for many years under the assumption that your insurer would do right by you in the event of an accident. If your insurer fails to follow through or delays investigations, this can have devastating consequences for your finances and quality of life.
About the Author:
Jeffrey Braxton is a trial lawyer in Fort Lauderdale who has devoted his career to the practice of personal injury law. As lead trial attorney for the South Florida Injury Law Firm, Jeff has litigated thousands of cases and is a member of the Million Dollar Advocates Forum, an exclusive group of attorneys who have resolved cases in excess of one million dollars.