When a loss occurs, policyholders must always be mindful of their property insurance policy’s section titled “Duties after Loss.” A policyholder is required to perform specific duties after a loss and failure to meet the obligations may jeopardize a claim.

In a recent case before Florida’s Second District Court of Appeal, an insurer argued that a policyholder was precluded from recovery of damages because they withheld an expert report until after they commenced a lawsuit and this was a breach of the requirement in the policy’s Duties after Loss section. In Herrera v. Tower Hill Preferred Insurance Company,1 the insureds submitted a claim to their insurer, Tower Hill for damages resulting from a sinkhole at their home. Tower Hill retained an expert who concluded that a sinkhole was not the cause of damage to the home. Tower Hill told the insureds that they could participate in neutral evaluation. They also advised the insured that if they demanded additional testing, Tower Hill would continue its investigation subject to a reservation of rights pending a determination of sinkhole activity.

The insured did not notify Tower Hill of any objection to the insurer’s expert report, and did not demand neutral evaluation or additional testing. In the meantime, the insured retained its own expert to review Tower Hill’s expert’s report, to perform testing and to investigate further the damage to their home. The insured’s expert concluded that sinkhole activity caused the damage to the home. The insured commenced a lawsuit for breach of contract against Tower Hill. In opposition to Tower Hill’s motion for summary judgment, the insured attached their expert’s report as an exhibit, which Tower Hill had never seen before. Tower Hill alleged that the insured breached the following policy provision:


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2. Concealment or Fraud.

a. Under Section I – Property Coverages, with respect to all “insureds” covered under this policy, we provide no coverage for loss under Section I – Property Coverages if, whether before or after a loss, one or more “insureds” have:
(1) Intentionally concealed or misrepresented any material fact or circumstance . . . .

The trial court granted Tower Hill’s motion for summary judgment and held that the insured’s failure to disclosed their expert’s report to Tower Hill before filing the lawsuit constituted a concealment precluding coverage. On appeal, the Second District reversed the trial court’s ruling and held that the policy did not require the insured to provide the report to Tower Hill “unless they had the report at the time of the claim but before insurer denied it” and that the “Duties After Loss” provision of the policy required the insureds to respond to requests but it did not obligate the insureds to produce documents to Tower Hill unsolicited.

1 Herrera v. Tower Hill Preferred Ins. Co., Case No. 2D13-2402 (2nd DCA October 29, 2014).