Just last week, Florida’s Fourth District Court of Appeals held that the Florida Insurance Guaranty Association (“FIGA”) wrongly denied a policyholder’s claim and was obligated to pay attorney’s fees and costs. In Rahabi v. FIGA, the appellate court distinguished the holding from its earlier case, FIGA v. Ehrlich, which was just decided in May of this year. I wrote about Ehrlich in my May 9, 2011 post titled Recent Ruling Concerning Attorney’s Fees And The Florida Insurance Guaranty Association. In Ehrlich, the Court held that FIGA was not responsible for attorney’s fees since it did not deny the policyholder’s claim by affirmative action. In Ehrlich, the trial court had ordered FIGA to answer the complaint in the lawsuit, and pursuant to that order, FIGA raised affirmative defenses.

Continue Reading Florida Court Distinguishes Its Ruling From A Few Months Ago And Orders FIGA To Pay Attorney’s Fees

In Late Notice Of The Claim Part 1 — Contrary to The Popular Belief of Insurance Carriers in Florida, Late Notice Is Not Necessarily An Absolute Coverage Defense, I wrote that the late notice defense is not an absolute coverage defense. In that post, I discussed the test the Florida Supreme Court has applied to late reported claims. When an insured fails to give timely notice of a loss, prejudice to the insurer is presumed. Bankers Ins. Co. v. Macias, 475 So.2d 1216 (Fla. 1985). A court should presume that the insurance company’s investigation into the cause and damages associated with the loss was prejudiced, however, policyholders can rebut that presumption by showing that the insurer was not, in fact, prejudiced by the late notice. Macias, 475 So.2d at 1218.

Continue Reading What Has Happened To The Rebuttable Presumption Of Prejudice In A Recent Late Notice Case?

Surplus insurers in Florida, a/k/a “non-admitted” insurers, have traditionally been exempted from certain regulatory schemes applicable to traditional “admitted” insurers. This was done to persuade these non-admitted carriers to continue to write insurance on risks not as attractive to the admitted carriers. As pointed out by Dick Tutwiler in his comment to my November 1, 2010, post, Eligibility Requirements for Florida Surplus Lines Insurance Carriers, two 2008 court decisions threatened the stability of the surplus lines insurance market in Florida.

Continue Reading Consistency in Florida Surplus Insurers Not Having to File their Rate Information with the Office of Insurance Regulation for Approval

In Florida, the Florida Insurance Guaranty Association (FIGA), was created by statute to pay claims to policyholders if their insurers become insolvent. The FIGA Act, §631.54(3) defines a covered claim as:

[A]n unpaid claim, including one of unearned premiums, which arises out of, and is within the coverage, and not in excess of, the applicable limits of an insurance policy to which this part applies, issued by an insurer, if such insurer becomes an insolvent insurer and the claimant or insured is a resident of this state at the time of the insured event or the property from which the claim arises is permanently located in this state.

Continue Reading The Definition of a “Covered” Claim by the FIGA Act Leads Florida Second and Third District Court of Appeals to Different Results

Coral Insurance Company has been placed in receivership. One aspect of handling claims where the insurer is in receivership is that a statutory time limit exists to file a lawsuit. However, for adjusters and policyholders, before a lawsuit can be filed, a "claim deadline" must first be met. We often get requests shortly before the lawsuit deadline only to find the claim deadline had not been met.

Continue Reading Claims Deadlines Set for Coral Insurance Company

A number of policyholder attorneys have asked me why FIGA is being so difficult lately. At one time, it was not that way. There has obviously been a change of the guard because nobody should expect quick resolution of any claim from FIGA based on recent complaints and the developing case law helps demonstrate this point.

Continue Reading FIGA is the New Slow Paying and Litigation Threatening “Insurer” in the Florida Property Insurance Claims Game