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Homeowners often presume that they are covered for property damage to their home caused by flooding.  This misconception can be even more harmful to homeowners because the term “flood damage” is far more expansive within the context of an insurance policy than the meaning when the term is used in everyday parlance.  Water damage caused by a swimming pool located on higher ground that overflows into the entrance of a backyard might be considered flood damage.  Since flood damage must be covered through the National Flood Insurance Program (NFIP), homeowners must understand the importance of ensuring they have flood coverage.  In this blog, our  homeowner insurance lawyers review a decision revealing the devastating consequences of terminating or failing to obtain flood coverage.

In Hodde v. American Bankers Insurance Company of Florida, the policyholders purchased two separate Standard Flood Insurance Policies (SFIP) on May 31, 2011.  The policies included a 30-day waiting period.  The terms of the policy allowed the insureds to cancel the coverage and obtain a full refund of all premiums during the waiting period.  On June 6, 2011, FEMA announced the Missouri River was flooding, which made the policies worthless for the June flood because the 30-day waiting period had not expired.  After FEMA designated the impending flood, the policyholders exercised their contractual right to terminate the policy and obtain a refund.  The policyholders home was subsequently destroyed when the Missouri River flooded shortly after the policies were canceled.  Continue reading →

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Florida has been fortunate in recent years to avoid substantial damage from hurricanes and tropical storms.  However, there is no doubt that many Florida homeowners will be faced with the need to make a claim for damage to their home and personal property because of this peril in the future.  While most policyholders probably assume coverage for hurricane damage is straightforward, the issue of coverage can be complicated.  Homeowners policies often place significant restrictions on coverage for water intrusion including wind-blown rain.  Our Miami hurricane insurance coverage lawyers understand that insurers often dispute coverage by claiming the damage was not caused by wind.

A case from the United States District Court, M.D. Florida, Jacksonville Division, Divine Motel Group v. Rockhill Insurance Company demonstrates the complex shifting burden of proof that often must be navigated when a hurricane damage claim is disputed.  The insured purchased a small motel and secured an “all risk” policy.  The property was badly damaged by Tropical Storm Debby five days after the purchase.  Continue reading →

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A common scenario that arises when people are in the process of selling their home after purchasing a new residence involves allowing another person to live in one of the homes until the old home sells.  The short-term use might include short-term executive housing, a vacation rental, or interim housing for family members.  Our Miami-Dade homeowners insurance attorneys recognize that the situation can get complicated and financially risky when the new home is damaged before the new owners take possession.  An appellate decision out of another state raises the specter of problems associated with this scenario, especially if the people temporarily residing in the home are paying rent.

In Scura Supreme Insurance Co. v. Johnson, the court reversed summary judgment granted by the trial court because of an issue of material fact regarding whether the person residing in the insured’s home was a “resident of the household” or a “tenant.”  This question was critical because the policy defined the “insured as “you and residents of your household.”  The O’Briens owned the home and rented it on a short-term basis to a sister and her husband while they were waited for a home sale to be finalized.  Dogs belonging to the in-laws living in the home dug under the fence and attacked a neighbor and her dogs.

The dog attack victim sued the O’Briens and their in-laws and filed a separate lawsuit seeking a declaratory judgment, indicating the in-laws fell within the category of “insured” individuals under the policy.  The neighbor injured in the dog attack contended that the in-laws were members of the household because they paid rent, resided in the O’Briens’ home, and used the address to register their kids for the school district.

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Our homeowners insurance attorneys Florida appraisal process can be an effective remedy for policyholders engaged in a dispute with their insurance company where the sole issue is the value of the property and/or amount of loss.  However, an insured cannot compel an insurer to submit to appraisal until issues regarding coverage have been resolved.  An interesting issue that arises when multiple buildings are listed under a single policy is whether the resolution of coverage issues regarding one or more of the buildings makes the entire claim “ripe,” which means ready for litigation (or the appraisal process).

A federal court decision applying Florida law ruled against the property owner under a commercial policy based on policy exclusions.  However, the most interesting aspect of the case dealt with the analysis of when multiple structures listed on a policy will be treated as independent claims rather than one comprehensive claim.  This decision is important for appraisal purposes.  If all of the buildings included in a policy are treated as a single property, the case becomes ripe for appraisal after all coverage issues are resolved related to one or more of the buildings.   By contrast, the court might treat each property as constituting a distinct and separate claim, which means appraisal does not become appropriate unless coverage issues involving all buildings are resolved. Continue reading →

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Our homeowners insurance coverage attorneys often meet people who are given the run around by their insurance carrier when they file a claim for damage to their home.  These individuals frequently assume they have no real recourse.  While policyholders usually understand that they can file a lawsuit for breach of contract, they might be concerned about their ability to afford attorney fees on an out-of-pocket basis.  Our law firm handles homeowners insurance claims involving denied policy benefits on a contingency fee basis.  Further, Florida courts can award lucrative attorney fee awards when an insurance carrier loses a breach of contract action.  In a case from the Florida 3rd DCA, Citizens Property Insurance Corp. v. Pulloquinga, the court not only granted attorney fees but applied a 1.5 multiplier to the amount of the fee award.

The insured filed a homeowner’s claim with Citizens after her house was destroyed by fire.  The insured promptly provided notice of the loss to her insurer and participated in an Examination Under Oath (EUO) without an attorney.  At the EUO, the insured provided documents supporting her claim.  Citizens issued a check for $5,000 to the insured but paid nothing more for the complete loss of her home.  The insured filed suit, and the carrier defended based on allegations of arson, insurance fraud, and misrepresentation in the application.  The homeowner was forced to continue paying her mortgage during the two-year period between the fire and date of trial.  She also was forced to seek out meager, alternative housing and to stay with friends.  Because the homeowner had to maintain her mortgage while living somewhere else, she experienced extreme financial hardships during this period.  Continue reading →

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Our Miami property damage attorneys find that there are many procedural and evidentiary issues that make the process of pursuing a legal claim complicated when your insurance carrier denies your claim.  While the law provides remedies and legal venues to pursue your rights, the path to obtaining benefits under a homeowner’s policy can be convoluted and complicated.  One issue that homeowners will have to understand and navigate effectively if they pursue a lawsuit for breach of contract against their insurer is the nature of the shifting burden of proof in a lawsuit involving an insurance claims dispute.  A recent case decided by the 2nd District Court of Appeal of Florida provides an overview of this shifting burden under an “all-risk” homeowner’s policy.

In Citizens Property Insurance Corporation v. Salkey, policyholders filed a sinkhole claim with Citizens.  Under the insured’s all-risk policy, the property was covered for all perils unless they were expressly excluded.  While the policy specifically excluded sinkhole damage, it also contained an endorsement for “direct physical loss” resulting from sinkhole activity.  The policyholders filed a lawsuit for breach of contract after their sinkhole claim was denied.  The jury reached a verdict in favor of the policyholders in the amount of $542,883, and the insurance carrier appealed the judgment. Continue reading →

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Our Miami-Dade County homeowners coverage attorneys recognize that bad faith claims pose special challenges because the issues of liability and damages must be bifurcated in a separate legal proceeding from the first-party bad faith action.  Fortunately, this does not mean that an insured must obtain a breach of contract verdict or settlement before moving forward with the bad faith lawsuit.  Forms of alternative dispute resolution can constitute a sufficient determination of liability and damages to permit a bad faith action to move forward against recalcitrant homeowners insurers.

In the 2nd District Court of Appeal of Florida case, Hunt v. State Farm Florida Insurance Company, the court considered a bad faith claim brought by a homeowner based on the insurer’s failure to cover a claim related to sinkhole activity.  The trial court granted the insurance company’s motion for summary judgment based on the failure of the policyholder to satisfy a condition precedent before filing a bad faith action and a lack of adequate notice under the civil remedy notice (CRN) statute.  Continue reading →

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Our homeowners insurance claims lawyers understand that many policyholders rely on their insurance agent or an adjuster from the insurance company to determine their rights and potential benefits under their policy.  Although you should contact your insurance agent and promptly notify your insurance company of a claim, your insurer might not always act to protect your best interest.  A fair number of policyholders who suffer devastating financial losses when their homes are damaged by hurricanes, fires, or other perils receive less than they are entitled to under their policies because they do not seek legal advice.

Our insurance property damage lawyers offer the case of Clifton v. Shelter Mutual Insurance Co. as an example of the folly associated with expecting your insurance company or adjuster to aggressively protect your interest.  Although this case is from another state and involves uninsured motorist coverage, the facts related to the insurance company’s handling of the claim provide a cautionary tale for homeowners. Continue reading →

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Although Florida law can be tough on policyholders, our insurance coverage attorneys know that there are statutory provisions that provide important protections to consumers.  A valuable statutory protection under Florida insurance law is referred to as the Valued Policy Law (FVPL) [§627.702, Fla. Stat. (2008)].  The FVPL provides expedited procedures for homeowners (including owners of mobile homes) who experience a total loss.  The FVPL imposes a duty on an insurer to determine the insurable value of a building and specify the value in the policy.  In the event of a total loss (i.e. the cost of repair exceeds the value of the building), the insurer is to pay the value indicated upon which premiums are collected.  While this law does not prevent your homeowners insurer from raising defenses to coverage, the established value often prevents the need for costly and time-consuming litigation when an insured suffers a total loss.

Given the power of this provision, our Miami homeowners coverage lawyers know insurance carriers frequently search for ways to circumvent this protection provided to policyholders.  The 1st District Court of Appeal for Florida considered an insurer’s contention that the appraisal provision in a policy could trump the FVPL in Freeman v. Integrity Insurance Company of Florida.  In Freeman, the policyholders’ residence was badly damaged by vandalism during a burglary.  They notified their insurer of the loss and their assumption of total loss, which would trigger their FVPL rights.  Continue reading →

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Our Miami homeowners insurance coverage lawyers recognize that many people who have a basement in their home are unaware that standard flood insurance policies exclude coverage for damage to their basement.  Some people also have no idea that flood damage to the lower level of their home might not be covered by their policy because of the nuanced definition of the term “basement” under Write-Your-Own policies issued under the National Flood Insurance Program (NFIP).  Because policies must conform to the language and terms dictated by the NFIP, this flaw in the protection of the lower level of homes from flood applies to many policyholders.  Further, our Miami homeowners insurance claims lawyers want policyholders to be aware that flood policies are interpreted narrowly because the program is subsidized by public funds.

The First Circuit opinion in Matusevich v. Middlesex Mutual Assurance Company offers a cautionary tale for those who perform improvements like adding a patio, deck, swimming pool, or similar upgrades to their home.  The insured purchased a Standard Flood Insurance Policy that included an exclusion for coverage of damage to the basement.  Under the policy, a basement was defined as “[a]ny area of the building, including any sunken room or sunken portion of a room, having its floor below ground level (subgrade) on all sides.” Continue reading →

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