What Are Your Legal Options When Your Insurance Company Denies Your Claim?
People buy insurance as protection against major disasters or unforeseen expenses that would be beyond their financial ability to pay on their own. Insurance companies accept the payment of premiums from insured individuals in exchange for providing this coverage if an event included under the policy contract occurs. In a perfect world, all the insured would have to do to cover the cost of repair or replacement is file a claim, but claims are often denied, which leads to insurance coverage disputes. Florida, in particular, sees a lot of complexity in the homeowner insurance market because of the volatile weather the state can experience near the coasts. The state faces the risks of hurricanes for half the year, which does not take into consideration dangers posed by tornadoes and wildfires. The consequence of living in place with these multiple hazards is that the cost of homeowner’s insurance is much higher and the number of companies offering coverage is much fewer. Given this situation, homeowners depend on claims being paid and often feel they have no recourse if it is denied since the cost and the dearth of insurers puts them at a large disadvantage. But, Florida law does permit consumers to file a lawsuit against insurers for bad faith denials of insurance claims.
What the Insurer Must Do When a Claim Is Filed
When a homeowner files a claim for property damage with the property insurance company, Florida law requires the insurer to follow certain guidelines when responding and processing a claim. First, the insurer must send an acknowledgement to the insured within 14 days that it received a claim. Then, once a proof-of-loss statement is submitted by the homeowner, the insurance company has 30 days to send confirmation that the claim is paid in full, covered in part, denied or under additional investigation. Ultimately, the insurer has 90 days to pay the insured for the portion of the claim that is covered under the policy or issue a denial. If the insurer does not adhere to these guidelines or denies a claim that appears covered under the policy, the next step is to initiate the civil remedy offered under Florida law.
Bad Faith and Civil Remedy
This legal option allows consumers to file a complaint with the Florida Division of Consumer Services, part of the Department of Financial Services, which is the first step in bringing legal action against the insurance company. The law requires a party wishing to bring a claim to give the Department and the insurance company at least 60 days notice of the consumer’s dispute and the basis of their complaint. Once the lawsuit is filed, the insurer must show the insurance company breached the terms of policy and acted in bad faith by not settling a claim that it could and should have. Specifically, the question becomes whether the insurance company acted fairly and honestly toward the insured and kept his/her interests in mind. A court will look at all of the circumstances surrounding the denial of the insurance claim to decide if bad faith existed, which is a complex and individual analysis decided on case-by-case basis.
Hire a Lawyer
If you have questions about an insurance claim that was denied, talk to an lawyer to find out if the insurance company abided by the terms of the contract or violated other legal requirements of insurance regulation. The Miami law firm of Pita Weber & Del Prado handles insurance dispute cases and can help you. Contact us to schedule a consultation.