Insurer Gets New Judge as Early Christmas Present

Insurance litigation can take on a life of its own. While pointed exchanges between attorneys is not altogether uncommon, judges typically stay above the fray, even when they believe a claim or defense has little chance of prevailing. This is not always the case, however, as noted in a recent appellate court ruling.1

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Recent Case Highlights Need for Code Coverage

As with most important rulings, a recent appellate court decision in favor of a Florida condominium association has been making the rounds through the national insurance news. In Slow, Late, and Delayed Replacement or Repair - - A Case That Helps Policyholders, Chip Merlin wrote about a recent Florida appellate decision in Axis Surplus Insurance Company v. Caribbean Beach Club Association.1 While the trial court rulings in favor of the association were upheld on multiple grounds, the appellate court wrote to highlight why the insurance carrier waived certain time limitation provisions in the policy.

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Texas Department of Insurance Issues Bulletin for Roofers and Adjusters

Roofing contractors and adjusters have been at the center of an ongoing debate in Texas. As I noted in Texas Moves to Limit the Role of Roofing Contractors, Texas enacted H.B. 1183, prohibiting insurance adjusters from doubling up as roofing contractors and preventing roofing contractors from acting as adjusters, or advertising to act as an adjuster, on any property they perform work.

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Florida 4th DCA Reaffirms Position On EUO Requirement

Since the Florida Supreme Court’s decision in State Farm v. Curran, practitioners and courts alike have been trying to sort out exactly how far the opinion goes. While many argue that Curran only applies to independent medical examinations, others point out that the Fifth District Court of Appeal specifically certified conflict with an earlier decision dealing with the application of the Examination Under Oath provision.

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Rules Are Rules, But Does Your Policy Cover The Cost Of Compliance?

Nothing is more familiar to individuals living in condominium and homeowner associations than the laundry list of rules and regulations that have been adopted. As a friend of mine can attest, even putting a rope swing in your yard can result in a hefty fine. So what happens when your association rules require you to do certain things in reconstructing after a loss? Does your policy cover these expenses?

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It Is Important To Know Who Is Investigating Your Claim

The past few weeks have seen the end of the first phase of important litigation that has been raging on since shortly after Hurricane Katrina made landfall in southern Mississippi. While the full details of the story would take many volumes to adequately address, the litigation arose over two State Farm whistleblowers, Cori and Kerri Rigsby, who brought to light what they believed to be the insurer’s attempt to systematically defraud policyholders. According to the sisters, State Farm and its managers directed claim investigators and engineers to find that damages were caused by flood, thus limiting any potential payments under the State Farm wind policies.

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Merlin Law Group Launches its Disability, Life, Health, and Long-term Healthcare Insurance Website

It is with great pleasure that Merlin Law Group announces the launch of its disability, life, health, and long-term healthcare insurance website: http://www.PayMyInsuranceClaims.com/

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Clarify Your Property Insurance Renewal Objectives

(*Chip Merlin's Note: This guest blog is by John Nixon, President and founder of Asperta, Ltd., an independent consulting firm focused on improving the quality of property insurance decisions by policy holders, agents, brokers, underwriters, reinsurers and investors.)

If you follow the insurance press, you’ve probably seen articles describing the favorable results of year-end treaty reinsurance renewals and consequential expectations of reduced pricing and improved terms for account renewals in 2014. The good news for condominium association boards is that it shouldn’t be difficult for most accounts to get improved property renewal terms.

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Condo Coverage: Unit Owner v. Association Policies

I recently received an email from a reader asking about the difference in insurance policies available for associations and tenants. In sum, the question asked for an explanation of an HO-06 insurance policy and whether that policy is available only for unit owners or for the association as well.

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The Duty to Indemnify in Florida

As I discussed my post “The Duty to Defend in Florida”, liability insurance policies have two distinct requirements. The duty to defend a policyholder against whom a claim has been brought and a duty to indemnify that policyholder for any damages awarded in that action. The duty to defend the policyholder against a claim is a broad duty. As I previously noted, an insurer is generally required to assume responsibility for the defense if the alleged facts and legal theories are the type that the policy could cover.

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The Duty to Defend in Florida

While property insurance is likely the most recognizable and most discussed type of insurance, equally important is the liability policies providing coverage for the association, its employees, and the board. Board members and property managers should discuss all types of liability coverages, from general liability to errors and omissions policies, to ensure that everyone has a good understanding of what coverages exist and when each may come into play.

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Appraisal: When Can It Be Invoked

Insurance policies have contained contractual appraisal clauses for many years. Recently, however, there have been a number of disputes over when appraisal can be invoked and when it can be rightfully rejected. Appraisal is appropriate when there is a “dispute” over the amount of loss. The problem faced by many courts has been when this “dispute” actually comes into existence.

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Coverage for Matching: What is a Carrier Required to Pay

Earlier this week I met with an association board of directors about their ongoing hail claim. While the association is sorting through a number of issues, one of the larger disputes centers around the siding installed on each of the buildings.

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Adding Insult to Injury: Holocaust Survivor's Claim Denied Over Lack of Documentation

I often tell policyholders, be it associations, unit owners, or homeowners, to be sure to document their personal property before a loss occurs. This is especially important for unit owners that have downsized from larger houses and may keep some of their property in storage. Often pictures, or even a video, can make all the difference in getting a claim paid.

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The Good Faith and Fair Dealing Debate Continues in Florida

For years a debate raged over whether Florida law recognized an action for breach of a common law obligation of good faith and fair dealing in a first party insurance claim. At the center were condominium associations that suffered damages from Hurricane Wilma and either had their claims underpaid or denied altogether. After years of waiting, the Florida Supreme Court issued its ruling in QBE Insurance Corporation v. Chalfonte Condominium Association, Inc.,1 holding there can be no independent cause of action for breach of the common law obligation of good faith and fair dealing.

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Texas Moves to Limit the Role of Roofing Contractors

As I was driving through Dallas this week I noticed more and more roofing companies advertising help with hail damage claims. Anyone who has been involved in property claims in Texas knows that roofing contractors are a common sight. In fact, Texas seems to have more roofing contractors involved in claims than any other state.

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Wind, Hail, and Hotel Basements: Insurance Companies in the Heartland Will be Busy

The last thing a person wants after a long day of traveling is to be evacuated from his hotel room and herded into a basement hallway filled with dated furniture that likely hasn’t seen the light of day in a decade. When traveling to the central states this time of year, however, this scenario is not uncommon.

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Hailstorm Damage to Commercial and Residential Roofing Systems

(Note: This guest blog is by Andrew Smith, a certified roof inspector with Roof Leak Detection Company, Inc.1)

Hailstorms are one of the most unpredictable natural disasters that occur throughout the country, primarily, but not limited to, the Midwest and Central states. These storms tend to be semi-seasonal, spontaneous, and typically without warning. When a hailstorm strikes, we seek shelter and enjoy at the spectacle being played out before our eyes. The sound of the impacts pound like a beating drum against the roof flinch at the sound of each thud, and after the storm we go outside check out the damage. We see damaged trees, a carpet of hailstones blanket the yard, and numerous small dents on the hood of your car. So you think to yourself: “Why call the insurance company? They would just come out, take a quick look at my car and tell me that the hail wasn’t big enough to cause real damage. It’s nothing that a wash and wax couldn’t fix. Maybe my rates would increase and they might even drop my coverage.” You don’t take any pictures, go back inside and forget all about it.

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Zurich Announces it will Offer Excess Flood Insurance

Whether from a hurricane, a broken dam, or a rising river, floods are one of the most common and most costly causes of loss. Because flood insurance is so difficult to obtain, floods are also one of the most feared causes of loss.

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Florida Law Requires Loss Assessment Coverage for Condominium Unit Owner Policies

Florida Statute § 718.111(4) gives condominium associations the power to make and collect assessments to “lease, maintain, repair, and replace the common elements of association property.” Typically, if common areas owned by condominium associations are damaged or destroyed, the associations may seek to have each of the individual unit owners pay for a portion of the damage. If the loss is one that the association is insured against, the association may still assess unit owners for any costs or liabilities other than what is recovered from the insurance claim.

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Most Insurance Policies Require Insureds To Give Prompt Notice Of A Loss. Does That Requirement Extend To Reopening Previously-Submitted Claims?

There is a lot of litigation from Hurricane Wilma still proceeding in Florida state and federal courts. Much of that litigation has concerned whether the policyholders have complied with their post-loss duties to submit information, documentation and appear for examination under oath. During the last year or so, probably the heaviest litigated issue concerns whether the policyholder gave adequate notice of the loss to the insurer as required by policy terms. Insurers that raise such a defense are looking for a judgment on a technicality, and request the court to declare that they have no responsibility for any damages because the policyholder breached their duty to notify them of the loss.

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Can Associations Require Their Unit Owners To Carry Property Insurance?

The short answer to this question is yes, as long as the Declarations address it. A recent case decided January 6, 2012, by a Florida appellate court involved this issue, as well as the association’s claim for attorneys’ fees and costs associated with the lawsuit. Alorda v. Sutton Place Homeowners Association, Inc., No. 2D10–3966 (Fla. 2d DCA 2012).

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The Incredible Shrinking Insurance Policy

A few years back, several journalists began reporting about a new trend in product packaging: offering less product for the same price. One of these journalists, Michael Brush, dubbed PepsiCo’s subtle repackaging as, “The incredible shrinking Doritos bag.” Most companies cited rising costs as the reason for reducing sizes, but when the result ends up being higher profits and larger market share, those motives could rightfully be challenged. According to Brush and Harvard Business School Professor John Gourville, this strategy works because consumers don’t react to a change in quantity like they do to a change in price. Unfortunately for insurance consumers, this trend is finding its way into the insurance industry.

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National Flood Insurance Program To Be Extended Again

Few coverages are more important than flood insurance. Whether it is storm surge from a hurricane, rising rivers, torrential rains, or broken levees, floods occur in every part of the United States. Unfortunately, as most people know, flood insurance is difficult to find. Since most private insurers specifically exclude flood from coverage, the majority of flood coverage is purchased from the National Flood Insurance Program, which is instituted and administrated by the federal government. Unfortunately this vital program has been short on funding for years, leaving many to wonder if the program can survive.

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Citizens Plans Large Rate Hike.....Again

While the holiday season usually brings good tidings and cheer, condominium associations and residents insured by Citizens Property Insurance Corporation can expect coal in their stockings this year. Once again, the state’s largest insurer plans to increase rates to Florida condominium residents between 19 and 20.6 percent on average leaving many dismayed, especially since it has been over 5 years since the last major hurricane.

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When is an Insurance Claim Ready for Litigation?

When asked if something is ripe, one might immediately think of fruit that is ready to eat. Similarly, the legal term “ripeness” means the readiness of a case for litigation. While a simple smell test may be all that is needed for fruit, the ripeness of a legal case, an insurance claim, and a legal case about an insurance claim, require a little more analysis.

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When Insurers Use Examination Under Oath to Harass the Witness

We have written several times in the Condominium Insurance Law Blog regarding examinations under oath and their importance in the insurance claims process. In his July 3, 2010 post titled Examinations Under Oath Can Be Difficult For Associations, Corey Harris gave an excellent description of what an examination under oath is and what the process entails. Corey wrote that:

[A]nyone sitting for an EUO should remember that while it is not a “legal proceeding,” it is about as close as you can get. The insurance company’s representative asking the questions will undoubtedly be an attorney, and you should plan for some tough questions.

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Federal Middle District Court Of Florida Orders Nationwide To Produce Documents It Withheld Under The Attorney-Client Privilege And Work Product Protection

On September 12, 2011, in Customary Discovery Practices May Vary Greatly Between Federal And State Courts, I discussed how the Federal Middle District Court of Florida resolved a discovery dispute between Nationwide and Pepperwood of Naples Condominium Association. Recently, the Court decided another discovery dispute between the parties. This one involved Nationwide’s claim of attorney-client privilege and work product protection to some document requests. Such claims of privilege are common in litigation. The resolution of these disputes can play a very important role in the information that the policyholder can obtain to support its claims, especially in a bad faith case.

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Colorado Court Employs Grammatical Approach to Determine Man-Made Earth Movement Not Excluded Under Earth Movement Policy Provision

If asked what an ordinary person might select for casual reading, one might think of books, magazines, or newspapers, but probably not insurance policies. If an ordinary person were to read an insurance policy, what would he or she think it meant? In states that employ the “reasonable expectations doctrine” for insurance policies, courts are often faced with this question. Colorado is one of the states that considers the reasonable expectation of the insured when interpreting insurance policies, and a recent condominium case there took a grammatical approach to determine what an ordinary reader would have understood the condominium policy to have covered.

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Whose Responsibility Is It To Find The Source Of An Unknown Water Intrusion?

The modern day condominium involves a unique combination of real property rights between the condominium association and individual unit owners. The property interests are separate but related and can lead to some interesting questions regarding the rights and responsibilities of the parties that own each particular interest.

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Associations Should Review Restoration Contracts Carefully

After damage has occurred, the claims process often takes more time than expected. Unfortunately, while this is not always avoidable, delay in reconstruction can cause further losses in rent and keep people out of their homes for longer than necessary.

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Customary Discovery Practices May Vary Greatly Between Federal And State Courts

"Custom in law is the established pattern of behavior that can be objectively verified within a particular social setting.” Wikipedia. Recently, the Federal Middle District Court in Florida decided a discovery dispute between a condominium association and its insurer, Nationwide, in the case Pepperwood of Naples Condo. Ass’n., Inc. v. Nationwide Mut. Fire Ins. Co., No. 2:10-cv-753, 2011 WL 3841557 (M.D. Fla. August 28, 2011). Discovery disputes arise when one party asks another to produce information, but the other party coes not comply. It is common for insurers to refuse to produce claim file materials, claiming the documents are protected by certain privileges and citing other objections. The Pepperwood case involved a situation where the condominium association sued Nationwide for bad faith damages for not promptly paying all insurance proceeds from the 2004 hurricane damages and forcing it to incur additional expenses in the claim presentation through an appraisal process.

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More Confusion of Florida's Statute of Limitations for Property Insurance Claims

On May 17 of this year, Florida Governor Rick Scott signed into law Senate Bill 408, which, among other things, shortened the statute of limitations for property insurance claims in Florida to five years from the date of the loss. Under the earlier Florida Statutes § 95.11 and § 95.031, the statute of limitations did not expire until five years after a property insurer had breached the insurance policy. The Senate Bill 408 change came roughly five and a half years after Hurricane Wilma destroyed an enormous amount of Florida property, and the change left many questioning whether they could still seek redress for these claims.

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Irene Flood Victims Should Fill Out Proofs of Loss Now

While some areas sustained substantial wind damages from Hurricane Irene, a large portion of the losses are related to floods caused by the storm. Anyone insured through the National Flood Insurance Program should read their policies carefully and pay close attention to the time requirements mandated in the provisions.

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Does Your Policy Shorten the Statute of Limitations?

Hurricane Irene appears to be affecting more people any other hurricanes in recent history. While storms like Wilma and Katrina devastated Florida, Mississippi, and Louisiana, Irene is forcing evacuations in no less than five states from the Carolinas to New York. After a storm, it is important to report damages early, even if you are unsure whether the amount of loss will exceed the deductible.

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Are Insurers Miscalculating Actual Cash Value Amounts?

Most basic commercial insurance policies, including association master policies, provide coverage for the actual cash value of damages sustained as a result of a covered loss. Actual Cash Value is generally the amount it would actually cost to repair or replace the damaged property, minus depreciation.

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What Is The Role of An Appraiser?

If an association is unhappy with its insurer’s offer to settle a claim, it has two main avenues to resolve the dispute. First, the association can retain an attorney and file suit against the carrier for breach of contract. Second, the association can invoke the appraisal process afforded by most insurance policies.

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Insurance Coverage May Require Analysis of More than Just the Policy

Sometimes it is easy to determine who is covered under an insurance policy just by looking at the declarations page of the policy. Other times it is not so easy. A recent case from State of Washington illustrates just how complicated it can be to determine who is and is not covered under a policy of insurance. In the case of Elkins v. QBE Ins. Corp., No. 11-5150, 2011 WL 1562386 (W.D. Wash. Apr. 21, 2011), an insured office condominium suffered a fire loss and questions arose as to whether individual office unit owners were covered for business interruption losses under the property insurance policy.

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Discerning Tornado Damage After A Storm

(Note: This Guest Blog is by Steven M. Thomas, president of Roof Leak Detection Company, Inc., a Certified Testing Laboratory located in South Florida which specializes in testing and consulting services for commercial and industrial properties).

Severe weather events such as tornados can result in significant property damage. Structural damage can take many forms – some are obvious and others are less visible. But they can all present significant safety risks and must be identified and addressed immediately.

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Recent Ruling Concerning Attorney's Fees And The Florida Insurance Guaranty Association

The Florida Insurance Guaranty Association (“FIGA”), generally assumes the liabilities of insolvent insurance companies. Pursuant to Florida Statute Chapter 631 FIGA assumes the rights, duties, defenses and obligations of an insolvent insurer. Florida Statute §631.70 excludes FIGA from the provisions of Florida’s attorney’s fee statute, §627.428, unless FIGA denies by affirmative action, other than delay, a covered claim or a portion thereof. Many Florida condominium associations were insured with insurance companies that have become insolvent, and so FIGA has stepped in to resolve pending claims by such associations. Often in these situations, associations and their representatives have important questions regarding whether FIGA is obligated to pay a reasonable amount of attorney’s fees if litigation against FIGA is necessary. A recent opinion from the Florida Fourth District Court of Appeal has some impact on these questions.

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Florida Southern District Grants Summary Judgment Against QBE, Finding Coverage For Association's Windows And Sliding Doors Damaged By Hurricane Wilma

The Southern District Court of Florida entered summary judgment in favor of the Royal Bahamian Condominium Association and found coverage for the windows and sliding doors damaged during Hurricane Wilma in 2005. Royal Bahamian Association, Inc. v. QBE Insurance Corporation, No. 10-21511 (S.D. Fla. October 28, 2010). It is an important ruling, since a majority of the damage claimed by the association from Hurricane Wilma was to the windows and sliding doors. QBE took the position that the windows and doors were not covered because those items are the individual unit owners’ responsibility to maintain under the condominium declarations. The association board members operated under the mistaken belief for several years after the loss that the unit owners were responsible for repairing and replacing the windows and doors damaged during the hurricane. The board sent out notices advising the unit owners of its interpretation of the condominium declarations and quoting the pertinent sections of the declarations related to unit owner responsibility to maintain the windows and doors. Once the association retained counsel and a team of experts experienced in first-party property insurance, it submitted a Proof of Loss to QBE for over $8 million in damages caused by Hurricane Wilma in 2009.

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Policy Changes Through Endorsements Are Not Always Valid

It is no secret in the insurance industry that the widespread damage caused by Hurricane Andrew, Hurricane Hugo, and the Northridge Earthquake changed the way insurers do business. While the claims handling process was forever changed by the internal programs instituted by large insurers like State Farm, Allstate, and Farmers, many companies also began to re-think the coverages. Meaningful mold coverage has all but disappeared, the definition of what constitutes a collapse has been significantly changed, and strict co-insurance provisions and large hurricane and earthquake deductibles are becoming more and more common.

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California Solutions To Florida Problems

Granted, California isn’t known for having all the answers. While some may believe it does, one look at the financial situation on the west coast shows otherwise. California may, however, provide some answers to tricky problems in Florida when it comes to insurance laws and regulations.

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Florida Ethical Concerns Surrounding Insurance Settlement Agreements

In Can a Condo Association Get Out of an Insurance Settlement Agreement? Jeremy Tyler discussed a recent California case involving a homeowner association’s challenge of an insurance settlement agreement. He provided an analysis into the factors an association would need to consider when attempting to challenge an insurance settlement agreement. Challenging such a settlement, even if based upon fraudulent inducement, can be a difficult decision for an association to make since, as Jeremy discussed, they may have to return the payment they did receive from the insurer. The facts in the case of Village Northridge Homeowners Ass’n v. State Farm Fire and Cas. Co., 237 P.3d 598 (Cal. 2010), where the policyholder alleged that the insurance company represented that the policy provided only $4.9 million worth of coverage when it in fact it provided $11.9 million, is very problematic and troubling.

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Must All Coverage Disputes Be Resolved Prior to a Court Order for Appraisal?

Last week, the Florida Fourth District Court of Appeal issued its ruling in Citizens Property Ins. Corp. v. Michigan Condo. Ass'n, No. 4D10-1794, 2010 WL 4226281 (Fla. 4th DCA Oct. 27, 2010). Michigan Condo. involved a condominium association that suffered damage to its property from Hurricane Wilma. The association timely notified its insurance company, Citizens, which investigated and estimated the amount of hurricane damage to be below the association’s insurance deductible. The association relied upon Citizens’ estimation, but later realized that damages were, in fact, in excess of the deductible, and reopened the claim. After Citizens had spent close to a year investigating the claim with no coverage decision, the association filed a Petition to Compel Appraisal in circuit court, based on the appraisal provision in the insurance policy. Citizens, in turn, denied coverage for the claim. Because there was a dispute in the amount of damage, with Citizens estimating the damage below the deductible and the association estimating the damage above the deductible, the circuit court ordered appraisal, and Citizens appealed.

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Citizens Policyholders May See Rates Increase In 2011

Although Florida has not seen a major hurricane touch its shores since Hurricane Wilma in 2005, Citizens Property Insurance Corporation may be raising rates on many of its policyholders. Earlier this month, Insurance Commissioner Kevin McCarty approved additional rate increases that will affect thousands of insureds, including many condominium associations.

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Florida Appellate Court's Recent Ruling Involving Insurer's Late Notice of "Supplemental" Claim Defense

Recently, the Third District Court of Appeals issued an opinion reversing a summary judgment that had been entered in favor of an insurer in a case involving a condominium association’s hurricane damage claim. I wanted to write about the case because it is an interesting ruling related to the topic of an insurer’s late notice of a “supplemental” claim defense, which is a topic that Jeremy Tyler and I have written about previously.

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Is Your Hurricane Deductible and Coinsurance Provision Enforceable?

In a previous post, Failing to Obtain Regular Appraisals Can Hurt Associations After A Large Loss, I wrote about the negative effect that a coinsurance provision can have on an association’s ability to recover after a large loss. Equally as problematic, almost all policies issued in Florida contain a separate deductible which applies only in the event of hurricane damage. Instead of a small deductible, most “Hurricane Deductibles” are based on a percentage of the policy limits. These deductibles vary, depending on the policy and the association’s choices when purchasing the policy, and they can rise as high as 10%.

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David Thompson's Dirty Dozen Condo Insurance Exclusions

A few weeks back, David Thompson, with the Florida Association of Insurance Agents (FAIA), wrote on the FAIA web site about “The Dirty Dozen” condominium insurance exclusions. Anyone who has access to the FAIA web site should definitely give it a read.

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Merlin Law Group Named Number 1 in 2010 Best Law Firms Ranking

Tampa, FL – September 15, 2010 – U.S. News Media Group and Best Lawyers have released the 2010 Best Law Firms rankings, marking the inaugural publication of this highly-anticipated annual analysis. Merlin Law Group is pleased to receive a number 1 metropolitan ranking for Tampa, FL, Insurance Law.

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Prevention of Performance with Replacement Cost Value

Last week, the 11th Circuit Court of Appeals issued its opinion in Buckley Towers Condo., Inc. v. QBE Insurance Corp., No. 09-13247, 2010 WL 3551609 (11th Cir. Sept. 14, 2010). The appeal and opinion dealt mostly with actual cash value (ACV) versus replacement cost value (RCV) damages, as well as law and ordinance damages and prejudgment interest. In a nutshell, actual cash value damages cover the cost of replacing the damaged property, minus depreciation, and replacement cost value damages cover the actual cost expended to replace the property, up to the policy limits. Michelle Claverol explained ACV and RCV calculations in much greater detail in her posts on the Property Insurance Coverage Law Blog titled, Understanding Replacement Cost Coverage: Valuation Issues in Florida, Part 5, and Replacement Cost Value Coverage After a Claim Denial: Florida Valuation Issues, Part 6.

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Rome Is Burning, Are You Ready?

From the wildfires burning out of control in Colorado to the gas explosion that incinerated whole streets in California, fire damage seems to get more attention lately than the three tropical systems in the Atlantic and Gulf of Mexico. Many associations have dealt with fires in one way or another. Whether it’s a grease fire in a kitchen or a blazing roof fire caused by a lightening strike, fires can cause millions of dollars of damage in a relatively short period of time.

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Condominium Unit Owner May Not Deny The Association Reasonable Access To Their Unit To Repair Common Element

The question of whether a condominium unit owner must provide his or her association access to the interior of their unit to perform repairs or maintenance to common elements was recently addressed in a Florida appellate court opinion, Hollywood Towers Condo. Assoc., Inc. v. Hampton, 35 Fla. L. Weekly D1424a, 2010 WL 2509178 (Fla. 4th DCA June 23, 2010). Hollywood Towers, a Florida condominium association, became concerned with the structural integrity of the concrete balconies on each unit, so it hired experts to inspect each balcony. The balconies are common elements under the association’s declaration documents and are the responsibility of the association to maintain. The expert discovered that Ms. Hampton’s balcony, among many others, had suffered corrosion requiring repair. The expert concluded that demolition and repair work should be done from the inside of Ms. Hampton’s unit to remove the appropriate amount of concrete and rebar four inches past where the corrosion stopped. The association determined that it would install a temporary dust wall to Ms. Hampton’s unit, to separate the work area from the rest of the unit.

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Associations Should Mark October 24, 2010 On The Calendar

In a recent post on Property Insurance Coverage Law Blog, Jeremy Tyler discussed general issues with the statute of limitations for filing lawsuits. As Jeremy correctly pointed out, the statute of limitations is a legal deadline for filing a lawsuit. If a lawsuit is not filed before the statute of limitations has expired, the lawsuit may be barred, despite the merits of the action. Complying with the statute of limitations is extremely important, and any association that suffered damages from Hurricane Wilma should pay close attention to the status of its claim and immediately make decisions on how to best proceed.

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Common Law Bad Faith Actions In Florida And Elsewhere

As I discussed in a previous post, What Is Bad Faith And What Can Be Done About It, most states, including Florida, recognize that every contract contains an inherent obligation that each party will perform with the utmost good faith and fair dealing. While insurance policies may not seem like typical contracts, they are. Therefore, when an insurer performs its contractual duties, i.e., adjusting a loss and making a coverage determination, it has a common law contractual obligation to perform in good faith.

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Vacancy Exclusions Are Effecting More Claims In Today's Economy

In today’s down economy, more and more homes, condominiums, and buildings are becoming vacant each day. Recently, many national news sources picked up a story out of Ft. Meyers, where one family was the sole resident of a 32-story condominium building. While the family undoubtedly enjoyed exclusive use of the pools and other amenities, this freedom was not without problems. The family reported that they often found themselves dealing with trespassers and vandals roaming the empty building.

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How Many Examinations Under Oath Can An Insurer Demand Of An Association?

The answer to this question is a resounding, it depends. As is often the case in law, the answer to this question depends on such things as the particular language of the policy, the areas of inquiry requested by the insurer, and whether different individuals have knowledge regarding the areas of inquiry.

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Hurricane Preparedness for Insurance Coverage

With Tropical Storm Bonnie passing through South Florida this past weekend, I thought this would be a good time to address the importance of hurricane preparedness. There are plenty of resources and guides for preparing property for a disaster, but I want to focus on preparing condominium insurance coverage.

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Submitting Volumes Of Documents Through Which An Insurer Can Make An Intelligent Inquiry Into The Details Of The Loss Does Not Relieve An Insured Of Its Obligation To Appear For Examination Under Oath

Here are common problems that arise when an insurance carrier requests examinations under oath in a claim filed by a condominium association:

  • The board of directors has changed and the current board members are not familiar with the details of the claim, damages, previous repairs and future necessary repairs;
  • The current board members are aware of the voluminous records and documents kept by the previous board through which the insurance carrier would be able to intelligently assess the details of the loss being claimed; and
  • The current board members will provide the insurance carrier with the documents and information for the insurer to ascertain all of the details of the claim, damages, previous and future repairs.
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More on Errors in Insurance Applications

The other day, a colleague and I were discussing potential insurance issues that could come up when another major catastrophe hits Florida. The conversation led to the subject of insurance application errors, which reminded me of Corey Harris’ post from June 8 of this year. Corey’s post accurately describes the rule of law in Florida under Florida Statute § 627.409, that any misrepresentation on an insurance application in Florida, whether innocent or intentional, may void coverage.

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When Can An Insurer Require An Examination Under Oath?

As I previously mentioned in Examinations Under Oath Can Be Tricky For Associations, most insurance policies have a requirement that an insured sit for an examination under oath upon the insurer’s request. As I stated last week, failing to attend an examination under oath may be grounds for an insurer to deny coverage.

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Insurance Coverage Provided By The Condominium Association To Condominium Property Is Considered Residential Insurance Coverage

Your first impression after reading the title of this article may be: “well that is obvious since there are residents that live within condominium associations.” Condominium claims are sometimes referred to simply as commercial claims when, in fact, they are classified by Florida Statute as “residential.”

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Escalating Debt Drowns Flood Insurance Renewal....Again

Ask anyone who has lived in a coastal community what types of insurance are most important and flood insurance will be always be at the top of the list. In fact, flood insurance should be near the top of the list in any area of the country, as evidenced by the recent flooding in Nashville, Oklahoma, and Arkansas.

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FEMA Clarifies Position: Flood Waters Mixed With Oil Will Be Covered

On day 52 of the BP oil spill, residents of the gulf coast are still feeling that they have many more questions than answers. At this point, we have seen the majority of the oil stay offshore, but now that hurricane season has officially begun, many are wondering what will happen if a tropical system roars through the gulf. While there is a potential that the oily water could be blown all over the buildings along the coast, the more likely scenario is that flood waters will carry the oil to land, leaving large deposits behind when the waters recede.

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Hurricane Expert Revises Prediction: "Looks Like a Hell of a Year"

While most people don’t pay close attention to the hurricane forecasts each year, in my business, one would be foolish not to. Yes, the forecasts for the past few years have suggested that the Atlantic hurricane seasons would be very active. And yes, these reports have turned out to be incorrect. So why do I take the time to check these predictions? The answer is simple, it helps me advise clients on the risks associated with hurricanes and helps me to motivate people to check their coverage.

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Recent Earthquake Activity Causes Many to Wonder About Coverage

Reports last week indicated that Southern California had been shaken by a 5.1 magnitude earthquake. After further review, however, the USGS downgraded the quake to a 4.5 and has opined that the tremor was most likely an aftershock from the April 4, 2010, 7.2 magnitude quake, which rattled buildings in Baja.

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Thoroughly Documenting Efforts And Expenses Is Crucial To Proving Claims From The Oil Spill

Thanks to all who attended yesterday’s town hall meeting in Destin, Florida. For all of you who were not able to make it, we had a huge turnout. The 500 seats filled quickly.

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Insuring A Condominium Building: What Is Covered Under The Association Policy?

One of the first steps in dealing with an association’s claim, is determining what is covered under the association policy and what is covered under the individual unit owner’s policy. Many associations and insurance professionals are unclear as to what exactly is covered by the association policy, and questions constantly arise during the claim.

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The Cooperation Clause and Document Production: A Condominium Association's Difficult Task

One of the most daunting tasks in submitting an insurance claim is the production of documents. Most insurance policies have language similar to the following:

The insured, as often as may be reasonably required, shall produce for examination all writing, books of account, bills, invoices and other vouchers or certified copies thereof if originals be lost, at such reasonable time and place as may be designated by the company or its representatives, and shall permit extracts and copies thereof to be made.

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