We know the importance of homeowners insurance in Florida.  Hurricanes such as Frances, Ivan, and Andrew and other “wind” events are somewhat regular reminders of what we all stand to lose and your insurance policy may not be the comforting safety net you expect it to be.

These policies’ coverage clauses, conditions to coverage (notice requirements, etc.), and policy “exclusions” present a tangled web which may deem payment of your claim unexpectedly difficult to achieve. For example, your policy is governed by Florida’s valued policy law (VPL), a statute designed to fix the measure of damages in a “total loss” scenarios (assuming the “peril” was a covered loss).  According to this law, the carrier must pay the amount of money for which such property was so insured pursuant to the policy (as long as the premium is charged and paid).

Here’s the Catch: Depending on who your insurance carrier is, collecting on your policy may be more difficult than you think… .

For the VPL to apply a structure (i.e. your home) would have to be damaged by a covered peril and that the building be declared a total loss.  If both requirements are met and your insurer chooses not to repair (deeming it a total loss), they are liable for the face value of the policy.  Although the statute does not define what exactly constitutes a “total loss,” the Florida Supreme Court adopted the “identity test” to provide some guidelines in making this determination.

The “Identity Test”  “A structure is a total loss if the damage to the structure is so severe that it has lost its identity and character as a building, even though a portion of the building’s components remain and can be utilized for some useful purpose.”  It seems to be a favorable standard for the policy holder, but insurance companies often dispute your claim.

Citizens Property Insurance Company gives new meaning to the phrase “total loss,” raising their rates for a third time next year.  A substantial portion of the rate hike proceeds will be used to cover their attorney’s fees, which average an estimated $2 million per month!  In fact, Citizens spends an estimated $30 million a year defending against claims, using lawyers from 177 different law firms.  This is money Representative Frank Artiles, a licensed general contractor and appraiser, believes could be better spent not pursuing an aggressive policy of rejecting claims and subsequently battling legal disputes in court.  Citizens and many other insurance companies bolster their profits at the expense of your benefits, with full knowledge that most won’t seek legal counsel to vindicate your rights. (*It is important to note that Florida law allows for attorney’s fees to be awarded in the event that an insured is required to hire counsel in order to enforce their rights, and thereafter prevails).

Attorneys credit Citizens’ rise in litigation and costs to their 2010 policy change removing a clause requiring a homeowner to hire a third-party appraiser when the claim is disputed and replacing it with a provision that allows Citizens to decide what should be appraised instead of the policyholder.  In recent articles The Herald/ Times was told by several attorneys that Citizens uniformly attempts to low-ball claims because, as a quasi-public corporation, it is not subject to “bad faith” laws that apply to private insurance companies.  Under this law, if the insurance company refuses to negotiate the claim fairly, the policyholder can recover damages.  The thought is that without this law protecting them, Citizens has the thumbs-up to act irresponsibly.

Fortunately, Gimenez & Carrillo, LLC has over 20 years of experience fighting on the behalf of policy holders.  Florida statutes provide for attorney’s fees if your case is successfully resolved/adjudicated, allowing Gimenez and Carrillo, LLC to take on your case without costing you anything up front!  Furthermore, we provide free consultations to help provide you with the best strategy to proceed with your case.  Don’t let the insurance company bully you out of the benefits you rightfully deserve.


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