On July 1, 2021, Senate Bill 76 went into effect. It creates Florida Statute 627.70152, which applies to first-party property insurance claims, and expands Florida Statute 627.70132 to create a strict notice requirement prior to filing a lawsuit.
- Lawsuits arising from a property insurance policy now have a notice requirement. Prior to filing a lawsuit, a claimant must give notice and make a pre-suit demand before filing a complaint. The notice must be given at least 10 business days before filing a lawsuit. However, it cannot be given before the insurance provider has made a coverage determination. The notice must state:
- The notice is provided pursuant to Florida Statute 627.70152(3);
- The alleged acts or omissions of the insurer giving rise to the suit, which may include a denial of coverage;
- A copy of the notice was provided to the claimant, if the notice was provided by an attorney or other representative;
- An estimate of the damages, if known, if the notice is provided following a denial of coverage;
- The disputed amount, and the pre-suit settlement demand, which must itemize the damages, attorney fees, and costs, if the notice is provided following acts or omissions by the insurer other than denial of coverage.
- Once the insurance provider has received the notice, they must have procedures in place to conduct any further investigation needed to a review and evaluate the dispute. The insurance provider must respond in writing within 10 business days after receiving the notice. If the insurance provider is responding to a claimant whose claim has been denied, the insurance provider must respond by accepting coverage, continuing to deny coverage, or asserting the right to reinspect the damaged property. Lastly, a Court must dismiss, without prejudice, any complaint relating to a claim for which a notice of intent to initiate litigation was not given as required by law.
- Attorney’s fees will be governed by Section 627.70152. In the notice of intent, policyholders are required to make a pre-suit settlement demand. In response, insurers may make a pre-suit settlement offer. The difference between the pre-suit demand and pre-suit settlement offer is the “disputed amount.” The amount of “reasonable attorney’s fees” will be calculated as follows:
- If the difference between the amount obtained by the claimant and the pre-suit settlement offer, excluding reasonable attorney’s fees and costs, is less than 20 percent of the disputed amount, each party pays its own attorney fees and costs, and a claimant may not be awarded attorney’s fees under s. 626.9373(1) or s. 627.428(1).
2. If the difference between the amount obtained by the claimant and the pre-suit settlement offer, excluding reasonable attorney’s fees and costs, is at least 20 percent but less than 50 percent of the disputed amount, the insurer pays the claimant’s attorney fees and costs under s. 626.9373(1) or s. 627.428(1) equal to the percentage of the disputed amount obtained times the total attorney’s fees and costs.
3. If the difference between the amount obtained by the claimant and the pre-suit settlement offer, excluding reasonable attorney’s fees and costs, is at least 50 percent of the disputed amount, the insurer pays the claimant’s full attorney’s fees and costs under s. 626.9373(1) or s. 627.428(1).
- The new law forces insurance providers, beginning on January 1, 2022, to file an annual report, on an individual and group basis, for closed claims. The report must include specific information regarding the litigation of personal and commercial residential property insurance claims, plus any information deemed necessary to follow litigation and claims trends occurring in the property market.
- Other changes involve court cases themselves. When a court receives notice of multiple legal actions arising from the same residential property insurance policy, property, and owners, the court may aggregate the claims and transfer jurisdiction to a court with proper jurisdiction based on the total amount in controversy of all the consolidated claims.
- The law restricts the conduct of contractors by prohibiting them from soliciting or incentivizing residential property owners from filing roof damage claims. Contractors will not be allowed to interpret policy provisions or advise property owners insurance coverage unless the contractor holds a license as a public adjuster. Contractors will be prohibited from providing an insured with an agreement authorizing repairs without providing a good faith estimate of the itemized and detailed cost of services and materials for repairs undertaken for a property insurance claim.
The new statute was created to assist the courts in reducing the ever-increasing number of first party property lawsuits. When the pre-suit notice requirements are not met, the carrier can seek dismissal. When proper notice has been given, there is a chance for resolution at the onset. Please contact us with any question.