Some insurance companies look for ways to deny insurance claims. One method is to use the “prompt notice” of loss requirement found in property insurance policies. State laws vary, but in Florida, the determination of whether “prompt notice” has been given and whether prejudice has occurred because of late notice is generally a fact question for a jury to determine.

A Florida case decided yesterday,1 recited law for this issue and provided some good lessons about “prompt notice” cases in Florida. The water loss notice was given only five days after the loss occurred. The Florida based insurer denied the claim for failure to provide “prompt notice.” The court noted:

The determination of whether an insured provides “prompt” notice of a loss to an insurer is a material issue of fact as it may affect the insurer’s coverage decision….Notice is said to be prompt when it is provided ‘with reasonable dispatch and within a reasonable time in view of all of the facts and circumstances of the particular case.

Because the resolution of insurance claim cases involve different scenarios, whereby the timing of the insured’s notice is superimposed over a backdrop of other relevant facts, we do not wish to create a bright line rule for when notice to an insurer is no longer “prompt.” … the question of whether the insureds’ notice to the insurer was untimely and caused prejudice to the insurer is a question of fact for the jury to resolve in view of “all of the facts and circumstances surrounding the loss.

The first question is whether the notice is untimely. The second question is whether the untimely notice caused prejudice to the insurer. These questions are normally for a jury to determine.

Here are some lessons from this case which should be followed as much as possible after a loss:

  1. Provide notice as soon as one can. This may pre-empt any argument about late notice.
  2. Document the loss scene and the damage with video and photographs.
  3. Keep the actual evidence of damaged pieces of property.
  4. Make your repairmen and eyewitnesses to the repair and loss available to explain what they saw and did.

Do not take a denial of your claim or an allegation of late notice as being gospel. It is amazing how little insurance company experts and adjusters say they can determine when asked “because of late notice, has your investigation be prejudiced?” They start looking and acting like the Three Monkeys who see, hear, and speak nothing while conducting their investigation. They will claim all kinds of prejudice with lawyers and claims managers who are giving them seminars about how to do it.

Insurance adjusters can come to a loss site completely destroyed to ash by fire or blown down to the slab by a hurricane and adjust the loss, make coverage determinations, and have experts that will provide scientific opinion. But, if a water pipe fails, the policyholder will often get an emergency contractor out to stop the water loss and prevent further damage. The loss better be reported in less than five days or some insurance adjusters will resemble a monkey much more than an empathetic insurance adjuster caring for a customer who just suffered a loss.

The Florida based Safepoint Insurance Company promises the following on the front page of its website:

Safepoint is an admitted property and casualty insurance company based in Tampa, FL specializing in coastal regions of the United States. We are a premier provider of insurance protection focused on providing superior customer service, expedited claims service and providing policyholders the peace of mind they deserve.

The customer gave notice five days after the loss. How long did it take after notice for an insurance adjuster to arrive on scene for “expedited claims service?” Five days.

Thought For The Day

The promise given was a necessity of the past: the word broken is a necessity of the present.
—Niccolo Machiavelli
1 Restoration Construction v. Safepoint Ins. Co., No. 4D19-3790 (Fla. 4th DCA Dec. 9, 2020).