A while back, my colleague, Shane Smith, wrote about a case, Herrera v. Tower Hill Preferred Insurance Company,1 where Florida’s Second District Court of Appeal considered – and then rejected – Tower Hill’s claim that its insured had violated the policy’s “Concealment or Fraud” and “Duties After Loss” provision by not disclosing their sinkhole expert’s report before filing suit.
In December, virtually the same issue was before the same court, once again by Tower Hill. In Diaz v. Tower Hill Prime Insurance Company,2 the insureds submitted an insurance claim to Tower Hill after noticing damages to their home consistent with sinkhole activity. Tower Hill denied the claim after its expert opined that the damage was not sinkhole related. Understandably, the insureds decided to get a second opinion and retained their own expert. This expert later issued a report concluding that sinkhole activity was the cause of the property damage, leading the insureds to file suit against Tower Hill.
Six months later, Tower Hill requested a neutral evaluation. During the process, the insureds provided Tower Hill with a copy of their expert’s report. Tower Hill decided not to go forward with the neutral evaluation and instead asked the trial court to enter summary judgment in its favor. Just like in Herrera, Tower Hill argued that the insureds had violated the policy by “concealing” their expert’s report. The trial court granted Tower Hill’s motion and the insureds appealed.
While Florida’s Second District Court of Appeals had unequivocally rejected Tower Hill’s argument under virtually the same set of facts presented in Herrera, Tower Hill nevertheless chose to hold its ground. But as most people probably expected, the court applied its prior ruling in Herrera and reversed the trial court’s order. I am hopeful that consistent favorable decisions for policyholders on this issue will finally put an end to this all-too-common argument from insurance carriers.