Credit: Vladislav Chorniy
Policyholders sometimes complain about the time it takes to get their claim settled with their insurance company. This is more likely to happen in property insurance claim disputes and it’s certainly something that our Florida carriers are aware of and the best of them are looking to streamline the process wherever possible. Litigation can certainly get in the way though, which brings us to an interesting case that was brought before Florida’s Fourth District Court of Appeal, which recently issued a ruling – brought to our attention by insurance defense attorney Robert Schulte of The Monson Law Firm of Tampa in his Linkedin post:
New 4th DCA Opinion: Claims handling testimony and argument merited mistrial. Universal v. Naze
A water damage claim was reported, and the insurer inspected the property and requested documentation from the insured. The claim was ultimately denied, with the insurer raising as one of its defenses that the insured failed to satisfy the condition precedent of producing documents detailing the claim.
During the trial, the opening statement from the insured’s attorney suggested the insurer wasn’t “waiting for documents, they were just flailing around” which prompted an objection from the insurer’s counsel. Later, the insured introduced testimony from their public adjuster criticizing the responsiveness of the insurer, and suggesting the insurer “really dropped the ball on this one.” The insurer again objected and raised a motion for mistrial which was denied. The closing arguments by the insured’s attorney included criticism of when the insurer assigned an adjuster, a request to the insurer for a supervisor, and the request for a coverage determination, and that the insured was upset with the handling of the claim. Following a verdict for the insured, the insurer sought a new trial premised on the erroneous admission of claims handling evidence. This was denied, and the appeal proceeded.
The 4th DCA agreed that admission of irrelevant and prejudicial claims handling evidence and argument denied it a fair trial. This evidence and argument that the insurer was “slow or incompetent in processing the claim” could have led the jury to decide the case “solely because the [insurer] did not ‘do a good job’ regardless of whether the incident fell within the policy exclusion.” The comments and evidence “went beyond disproving the insurer’s affirmative defense and ventured into claims handling.” The 4th DCA specifically cited the verbiage of “dropped the ball,” “flailing around,” responding with “crickets,” not “[taking the claim] seriously” and making “no investigation” as supporting their determination.
“In short, the admitted evidence was irrelevant to the issues pled. By admitting this irrelevant evidence, the insured was able to paint the insurer in a bad light and suggest its bad faith in handling the claim”
The case was reversed and remanded for a new trial.
We appreciate Bob sharing this in his post, which includes a link to the 4th DCA opinion. Claims handling is certainly a sore spot in our collective conscious – in this case, it unfairly prejudiced the jury. In my travels around the state, I consistently see insurance executives improving ways to expedite the claims process, doing all they can to reduce costly litigation.
State Budget: Six weeks after the Florida Legislature was scheduled to end its session, House and Senate budget leaders this past Friday afternoon announced they’d reached a deal on a new state budget for the fiscal year that begins on July 1. A vote by the full legislature could come as soon as tonight (June 16, 2025), which would allow the Governor two full weeks to review it and consider line-item vetoes. The News Service of Florida reports that a bottom-line total for the budget wasn’t immediately available but is expected to be less than the Governor’s proposed $115.6 billion spending plan, which is more than $3 billion less than the current year’s budget. Leadership also released a $1.3 billion tax-cut package that includes eliminating the rest of the sales tax on commercial leases.
LMA Newsletter of 6-16-25
