A week after a federal court found that waiting two years to file a property claim is too long, a state court reached a different conclusion: Failing to timely file supporting documents on a claim does not necessarily harm the insurer.
In Winston and Kathleen Dias vs. Universal Property and Casualty Insurance Co., Florida’s 4th District Court of Appeal on Wednesday examined the subtleties of state insurance law, case law and policy requirements.
Writing for the majority of the court, Judge Martha Warner said that a Broward County trial court had erred when it sided with Universal. The trial judge had essentially upheld the insurer in its denial of the claim. Universal had denied the claim when the homeowners failed to provide key information — until almost five months later.
“That an insurer is required to pay or deny a claim in accordance with the statutory terms does not necessarily show that an insurer is prejudiced when the insured does not cooperate,” the appeals court wrote.
The opinion explained that the Dias home suffered water damage in March 2016. The couple hired a public adjuster, who filed a claim about a month later. Universal asked for a sworn proof-of-loss statement. Universal’s own adjuster then inspected the damage about two weeks later, in May.
On May 24, two months after the damage occurred, Universal again asked for a proof-of-loss statement and other documents. A few weeks later, the carrier asked again. Having received no information, Universal denied the claim in July. The Diases filed suit in October 2017.
Universal argued that it had little choice: A Florida law, adopted in 2020, requires insurers to accept or deny a claim within 90 days, and that failure by the homeowners to provide needed documents had hurt the insurer’s ability to weigh the claim. The appeals court also noted that previous court decisions have found that prejudice to the insurer is presumed when policyholders breach policy requirements, but that the insureds can rebut that and show that the carrier had not been prejudiced.
The Diases’ attorneys, George Vaka and Nancy Lauten, of Tampa, argued that the couple had provided the necessary documents, albeit late, and that Universal’s own adjuster had testified that he had fully inspected the property and had everything he needed to prepare a restoration estimate. On the 90-day statutory deadline, the appeals court said that the law does not mandate action on a claim if the failure to pay is caused by factors beyond the insurer’s control.
“That an insurer is required to pay or deny a claim in accordance with the statutory terms does not necessarily show that an insurer is prejudiced when the insured does not cooperate,” Judge Warner wrote. “The failure of the insured to comply with policy provisions would be a matter not within the insurer’s control.”
Besides, the court said, statutes allow for a claim to be reopened.
“Because a disputed issue of fact remains as to whether insurer was prejudiced by the untimely submission of the sworn proof of loss and documentation, the trial court erred in granting summary judgment,” the opinion concluded. “We thus reverse and remand for further proceedings.”
A week earlier, the U.S. District Court for the Southern District of Florida found, in LMP Holdings vs. Scottsdale Insurance, that homeowners who waited 27 months to file a claim had prejudiced the insurer. The policy in that case required prompt notice after damage was discovered, and after two years, the carrier had scant ability to rebut the claim, the federal court said.
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