Civil Remedy Notice of Insurer Violations
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Filing Number:     666857
Filing Accepted:  1/10/2023
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Complainant
Last/Business Name *  
SULLIVAN   First Name   CHRISTINE AND ROCKY
Street Address * 14890 AMERICAN EAGLE CT
City, State Zip * FORT MYERS, FL 33912
Email Address * LITIGATION@THEFREEMANLAWFIRMPA.COM
Complainant Type: * Insured
Insured
Last/Business Name*   SULLIVAN   First Name   CHRISTINE AND ROCKY
Policy # * 59-CG-H221-4 Claim #* 59-28P7-66X
Attorney
Attorney is Applicable
Last Name* FREEMAN First Name * BRIAN Initial
Street Address* 4245 FOWLER STREET
City, State Zip* FORT MYERS , FLORIDA 33901
Email Address * LITIGATION@THEFREEMANLAWFIRMPA.COM
Violation
Insurer Type *   Authorized Insurer Unauthorized Insurer
 
Insurer Name*   STATE FARM FLORIDA INSURANCE COMPANY
NAIC Company Code 10739
 
Name of individual responsible for violation (if any):* JEFFREY DEBERRY
Type of Insurance * Residential Property & Casualty   
Reason for Notice *
Claim Denial
Claim Delay
Unfair Trade Practice
Other : Bad Faith
* Statutory provision(s) which the insurer allegedly violated.
 
624.155(1)(b)(1) Not attempting in good faith to settle claims when, under all the circumstances, it could and should have done so, had it acted fairly and honestly toward its insured and with due regard for her or his interests.
624.155(1)(b)(3) Except as to liability coverages, failing to promptly settle claims, when the obligation to settle a claim has become reasonably clear, under one portion of the insurance policy coverage in order to influence settlements under other portions of the insurance policy coverage.
626.9541(1)(i)(3)(a) Failing to adopt and implement standards for the proper investigation of claims.
626.9541(1)(i)(3)(b) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue.
626.9541(1)(i)(3)(c) Failing to acknowledge and act promptly upon communications with respect to claims.
626.9541(1)(i)(3)(d) Denying claims without conducting reasonable investigations based upon available information.
626.9541(1)(i)(3)(f) Failing to promptly provide a reasonable explanation in writing to the insured of the basis in the insurance policy, in relation to the facts or applicable law, for denial of a claim or for the offer of a compromise settlement.
626.9541(1)(i)(3)(g) Failing to promptly notify the insured of any additional information necessary for the processing of a claim.
626.9541(1)(i)(3)(h) Failing to clearly explain the nature of the requested information and the reasons why such information is necessary.
* Specific policy language that is relevant to the violation.
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The Insureds are not in possession of a full and complete certified copy of the Policy but believe the Policy language relevant to the violations includes all applicable policy coverages, loss payment provisions, valuation provisions and other terms and conditions of Policy No. 59-CG-H221-4. Despite numerous requests the Insurer failed to provide the Insureds with a full and complete certified copy of their policy. The Insureds believe the following policy provisions found in similar insurance policies are applicable: Coverage A-Dwelling 1. Dwelling. We cover the dwelling used principally as a private residence on the residence premises shown in the declarations. The Dwelling includes: a. structures attached to the dwelling. b. materials and supplies located on or adjacent to the residence premises for us in the construction, alteration or repair of the dwelling or other structures on the residence premises; SECTION I- LOSSES INSURED Coverage A - Dwelling We insure for accidental direct physical loss to the property described in Coverage A, except as provided in Section I - LOSSES NOT INSURED. SECTION I- LOSS SETTLEMENT Only the Loss Settlement provisions shown in the Declarations apply. We will settle covered property losses according to the following. Coverage A- Dwelling 1. A1-Replacement Cost Loss Settlement- Similar Construction. a. We will pay the cost to repair or replace with similar construction and for the same use on the premises shown in the Declarations, the damaged part of the property covered under SECTION I - COVERAGES, COVERAGE A- DWELLING, except for wood fences, subject to the following: (1) until actual repair or replacement is completed, we will pay only the cash value at the time of the loss of the damaged part of the property, up to the applicable limit of liability shown in the Declarations, not to exceed the cost to repair or replace the damaged part of the property; (2) when the repair or replacement is actually completed, we will pay the covered additional amount you actually spend to repair or replace the damaged part of the property, or an amount up to the applicable limit of liability shown in the Declarations, whichever is less; (3) to receive any additional payments on a replacement cost basis, you must complete the actual repair or replacement of the property within two years after the date of loss, and notify us 30 days after the works has been completed; and 2. A2-Replacement Cost Loss Settlement- Common Construction a. We will pay the cost to repair or replace with common construction and for the same use of the premises, shown in the declarations, the damaged part of the property covered under SECTION I- COVERAGES, COVERAGE A - DWELLING, except for wood fences, subject to the following: (1) we will pay only for repair or replacement of the damaged part of the property with common construction techniques and materials commonly used by the building trades in standard new construction. We will not pay the cost to repair or replace obsolete, antique or custom construction with like kind and quality. (2) until actual repair or replacement is completed, we will pay only the actual cash value at the time of the loss of the damaged property, up to the applicable limit of liability shown in the Declarations, not to exceed the cost to repair or replace the damaged part of the property described in a.(1) above.
 
* Facts and circumstances giving rise to the violation.
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During the policy period, on December 21, 2021, the Insureds’ home located 14890 American Eagle Ct., Fort Myers, FL, 33912 (“Home”), owned by the named Insureds, Christine and Rocky Sullivan ("Insureds”), suffered wind related physical and structural damage as a direct result of a tornado, an event covered under the subject insurance policy. The Insureds timely reported the loss to their insurance carrier, State Farm Florida Insurance Company ("Insurer"). Since the beginning of the claims process, the Insureds have fully cooperated in the Insurer's investigation of the Insureds’ tornado damage claim. The Insureds reported a claim to the Insurer regarding the damages to the Insureds’ home and roof system. The Insurer responded to the notification of the loss and damage claim of the Insureds by assigning claim number 59-28P7-66X to the Insureds’ tornado damage claim and notifying the Insureds that an inspection of their loss and reported damages would be performed. The inspection was conducted by an unnamed adjuster at the request of the Insurer. The adjuster’s inspection was quick and cursory of the damage to the Insureds’ home and roof system. The inspection concluded, with no real basis of fact, “it was determined other non-loss conditions associated to wear, tear, deterioration, mechanical breakdown, and maintenance issues were present.” Although the Insureds have requested on multiple occasions a complete copy of the unnamed consultant’s report, the Insurer failed to provide the Insureds with any copy of the report. The Insurer also informed the Insureds “the damages to your property did not exceed your $5,365.00 deductible.” However, the Insurer did not provide with any specificity exactly what the documented damages to the Insureds’ home and roof system were. Due to the obvious ongoing problems at their home, the Insureds hired Archer Claims (“Archer”), to determine the extent of damage to their home and roof system as a direct result of a tornado. Archer performed a comprehensive evaluation of the damage to the Insureds’ roof system and documented numerous missing, creased, torn and damaged shingles and other tornado related damage to the Insureds’ roof system. The inspection confirmed Archers’ initial perception; the Insureds’ roof system had severe wind related physical and structural damage and required a full roof system replacement. Archer provided the Insureds with a damage estimate for a full roof system replacement and exterior repairs totaling $56,060.39. Archer’s damage estimate provided detailed, line-item costs for all of the necessary items and applicable taxes for the complete replacement of the Insureds’ roof system and exterior repairs. The Insurer is required under the policy to restore the Insureds’ home and roof system to its pre-loss condition. Despite the overwhelming evidence the Insureds’ home and roof system had been significantly structurally damaged by the tornado, all covered losses under the subject insurance policy; the Insurer delayed and unreasonably and improperly investigated and evaluated the amount of damage to the Insureds’ home and roof system. The Insurer partially denied the Insureds’ claim on the basis of a completely inadequate investigation of the damage to the Insureds’ home and roof system indicating all of damage to the Insureds’ home and roof system was not tornado related and a nonsensical policy interpretation. On December 30, 2021, the Insurer sent a letter partially denying the Insureds’ tornado claim for damage to the Insureds’ home and roof system, providing the Insureds with a coverage determination letter that concluded; “[b]ased upon the results of our discussions, site inspection, and investigation, it was determined other non-loss conditions associated to wear, tear, deterioration, mechanical breakdown, and maintenance related issues were present.” These types of damage is a loss not insured under the terms of your policy, and we are unable to extend coverage for this portion of your claim.” Moreover, the Insurer did not perform a legally sufficient tornado damage investigation by failing to perform a substantial structural damage investigation and determination as required by the Florida Building Code. The Insurer’s failure to perform this important substantial structural damage determination further indicates the Insurer did not comply with the basic requirements inherent in the proper investigation of tornado damage claims, and instead performs inadequate, untimely and incomplete investigations in order to improperly completely deny valid tornado damage claims. The work of adjusting insurance claims in Florida engages the public trust. In the instant case, the Insurer breached this duty through its improper partial denial and complete failure to properly investigate the tornado damage claim of the Insureds. The Insurer's failure to communicate with the Insureds and improper partial denial of the Insureds’ tornado damage claim indicates the Insurer failed to adopt and implement proper standards for the investigation, evaluation and adjustment of claims; failed to properly train, manage, supervise and promote claims adjusters so Insureds receives good faith, fair and prompt adjustment of claims; and failed to conduct a full and fair investigation of this tornado damage claim. The Insurer furthermore failed to provide full reasons and facts to the Insureds for the partial denial of their tornado damage claim resulting in the statutory violations as set forth in this notice. The Insurer also breached its duty to the Insureds by failing to timely and promptly pay the correct indemnity owed to its Insureds. This duty is owed by the Insurer to its Insureds and is inherent in the insurance claims process. The Insureds promptly provided all necessary documentation, evidence and information for a timely resolution of their tornado damage claim, including an itemized roof damage estimate and extensive documentation of the damage to the Insurer which clearly shows the Insureds’ roof system must be completely replaced and cannot be repaired. However, to date, the Insurer has failed to provide timely and prompt payment for the Insureds’ damages. To date, the Insureds have performed all conditions precedent required of them under the subject policy of insurance with the Insurer and under Florida law. However, the Insurer failed and refused to properly investigate the Insureds’ tornado damage claim, and failed to tender all insurance proceeds due and owing to the Insureds under the subject insurance policy. Due to the Insurer's intentional delay and partial denial of the Insureds’ tornado damage claim, the Insureds have been forced to obtain legal counsel at a significant cost and expense to attempt to recover what they are legally owed under their insurance policy with the Insurer. The Insurer violated the statutes set forth above based on the conduct described herein. The Insurer failed and refused to timely tender insurance proceeds required by its insurance policy with its Insureds. In addition, the Insurer failed to reasonably and properly settle and resolve the Insureds’ tornado damage claim for money damages when under all the facts and circumstances, it could have and should have done so if it had acted fairly and honestly towards its Insureds. The Insurer's improper actions are well documented and have occurred with such frequency as to constitute a general business practice and were made in a reckless disregard for its Insureds’ rights. The Insurer placed its interest above and before the Insureds’ interest in this matter. Therefore, to cure the defects outlined in this Civil Remedy Notice, the Insurer must do the following: A. Create, adopt and implement adequate standards and guidelines for the proper investigation and adjustment of tornado damage claims. B. Provide sufficient training and supervision of its employees and agents to avoid further violations as set forth in the paragraphs above from occurring in the future. C. Immediately pay the Insureds’ tornado damage claim in the amount of Archer’s damage estimate of $56,060.39. D. Immediately pay to date interest on the Insureds’ tornado damage claim to the Insureds. E. Agree to pay the Insureds’ reasonable attorney fees and costs pursuant to Fla. Stat. 627.428 which to date totals $25,000.00. F. Pay all other and further coverages allowed by law to fully compensate the Insureds for their tornado damage claim.
Comments
User Id Date Added Comment
hkrall@gaflaw.com 02-15-2023 Please be advised that the undersigned represent State Farm Florida Insurance Company (hereinafter, “State Farm®”) with regard to this matter. This letter shall serve as State Farm’s response to the Civil Remedy Notice of Insurer Violations (hereinafter, “Notice”) filed on behalf of the Complainants, Christine Sullivan and Rocky Sullivan (“Insureds”). The Notice filed on behalf of the Insureds is legally insufficient as it lacks specificity. The Notice fails to identify the specific facts giving rise to the alleged violations of Florida Statutes §§ 624.155(1)(b)(1), 624.155(1)(b)(3), 626.9541(1)(i)(3)(a), 626.9541(1)(i)(3)(b), 626.9541(1)(i)(3)(c), 626.9541(1)(i)(3)(d), 626.9541(1)(i)(3)(f), 626.9541(1)(i)(3)(g), and 626.9541(1)(i)(3)(h). Accordingly, the Notice is insufficient as a matter of law and this letter does not waive such legal insufficiency in any way. State Farm objects to the Notice, as it lacks sufficient specificity, as required by §624.155, Fla. Stat., in addition to other defects. Due to the lack of specificity and other defects, the Notice cannot serve as a condition precedent to any action attempted under the above statutes or Florida law. The lack of specificity and other defects deprive State Farm of any meaningful notice and ability to respond and render the Notice invalid. Defects such as these thwart the fundamental purpose of the Notice, which is to give the insurer the opportunity to “cure” the alleged violations within the 60-day statutory period. An invalid Notice is also contrary to the purpose and requirements of Florida law, including the notice and safe harbor or “cure” provisions of §624.155, Fla. Stat., which are a necessary prerequisite to any future bad faith action against State Farm. See, e.g., Talat Enterprises, Inc. v. Aetna Cas. & Sur. Co., 753 So. 2d 1278 (Fla. 2000); see also, Julien v United Property & Casualty, 2021 WL 824438 (Fla. 4th DCA 2021) (civil remedy notice not legally sufficient where insured failed to state with specificity the information set forth in the notice; failed to specify the language of the statute the insurer allegedly violated; and failed to reference specific policy language that is relevant to the violation, if any). State Farm objects to the Notice, and the Notice is defective because it merely uses boilerplate language as to State Farm’s actions, which fails to explain how State Farm was wrong in its assessment of the alleged damages. The subject policy issued by State Farm is governed by the policy’s terms, conditions, and exclusions together with any endorsements. This response does not waive any such provisions of the policy. Due to the lack of specificity and other defects, the Notice is invalid and cannot serve as a condition precedent to any action for alleged bad faith under §624.155, Fla. Stat., or otherwise under Florida law. State Farm categorically denies any violation of the Florida Statutes as alleged in the Notice or otherwise. Contrary to the allegations contained in the Notice, State Farm conducted a proper and thorough adjustment, investigation, and evaluation of this claim. State Farm inspected the subject property and at all times performed its obligations under the insurance policy in good faith and with due regard for the interests of the Insured. This claim was initially reported to State Farm on December 21, 2021, for damage that allegedly occurred on December 21, 2021. By letter dated December 21, 2021, to the Insureds, State Farm confirmed receipt of the claim, and requested a call back to discuss the facts of the loss. By letter dated December 21, 2021, State Farm again confirmed receipt of the claim, advised the Insureds to protect the property from further damage or loss, and further advised the Insureds to complete reasonable and necessary temporary repairs, if needed. State Farm also advised the Insureds as to policy limits for services that may have been completed at the property. By letter also dated December 21, 2021, State Farm advised the Insureds as to the HOMEOWNER CLAIMS BILL OF RIGHTS. On December 21, 2021, State Farm spoke with the Insureds regarding the facts of the loss. State Farm was advised as to a tornado in the area of the property, which knocked down trees (but without any tree damage to the property), and blew off roof shingles (but with no interior damage reported). A roofer thereafter inspected the property, and completed temporary repairs. By email dated December 22, 2021, the Insureds’ roofer forwarded to State Farm a contract to replace the roof for $28,700, a direct pay authorization, and a W-9 form. On December 29, 2021, State Farm inspected the property with the Insureds present (the Insureds’ contractor appeared after the inspection was completed, and while State Farm was preparing an estimate). As to the roof, State Farm observed a total of six damaged shingles, along with damage on two hip areas of the roof. As to the exterior, no damage was observed. As to the interior, no damage was reported, and this area of the property was not inspected. By estimate dated December 29, 2021, State Farm opened coverage for repairs to the roof, for roof tarp installation/re-installation, and for debris removal. By letter dated December 30, 2021, State Farm advised the Insureds of its claim decision, as follows: Thank you for meeting with me on December 29, 2021, when we discussed the damage to your property. As we discussed, the damages to your property did not exceed your $5,365.00 deductible. Therefore, we are unable to issue a payment on this claim. Based upon the results of our discussions, site inspection, and investigation, it was determined other non-loss conditions associated to wear, tear, deterioration, mechanical breakdown, and maintenance related issues were present. These types of damage is a Loss Not Insured under the terms of your policy, and we are unable to extend coverage for this portion of your claim. While State Farm has inspected your residence, an inspection of the interior of your home did not occur. You advised you did not want to proceed with the interior inspection and, thus, no interior inspection occurred. If you become aware of interior damage you believe may relate to this loss, or would want State Farm to inspect the interior of your home, please contact us as soon as possible to schedule an inspection. By letter dated January 5, 2022, State Farm advised the Insureds of the right to mediate the claim. On February 8, 2022, the Insureds’ public adjuster forwarded to State Farm a copy of his services agreement with the Insureds, and a letter of representation with an overbroad document request. By email dated February 16, 2022, the public adjuster forwarded to State Farm an estimate for $56,060.39, along with photographs. By email dated February 22, 2022, State Farm forwarded to the public adjuster a copy of the insurance policy. On February 23, 2022, State Farm spoke with the public adjuster. He advised as to an issue with obtaining matching roof shingles to repair the roof, and as to an issue with completing repairs to the roof. In response, State Farm requested a video of an attempted roof repair, along with information confirming matching roof shingles were not available to complete repairs on the roof. The public adjuster also advised State Farm as to an interior leak that damaged a light. On February 28, 2022, the public adjuster forwarded to State Farm the Insureds’ untimely sworn statement in proof of loss for $56,060.39. By letter dated March 1, 2022, State Farm rejected the Insureds’ sworn statement in proof of loss as it was not submitted in compliance with the conditions of the insurance policy. State Farm also advised the Insureds as to the specific dispute as to the amount of the loss (as per the estimate prepared by each party), and the need for the Insureds to provide to State Farm all relevant claim information, documentation, and materials. By email dated March 16, 2022, the public adjuster advised State Farm as to a dispute on the issue of the availability of roof shingles to be used to repair the roof. By letter also dated March 16, 2022, State Farm requested the further information from the Insureds, as follows: On February 23, 2022, we contacted you to discuss your loss and requested certain additional information in order to evaluate your claim. Since that time, we have not heard from you. We will give your claim further consideration once we receive the requested information as outlined below: Possible matching issue with shingles Interior water leak that may have caused damage to light On March 31, 2022, the Insured, Christine Sullivan, served a first Civil Remedy Notice on State Farm. On May 12, 2022, State Farm responded to the first Civil Remedy Notice. By letter dated April 26, 2022, to Insureds’ counsel and the public adjuster, State Farm requested the following information: a video of an attempted roof repair; documents and information on any matching issue alleged on behalf of the Insureds; and photographs and information on a reported interior leak that damaged a light. By email dated April 28, 2022, the Insureds’ public adjuster demanded appraisal to resolve the amount of the loss, and provided the name and contact information for the Insureds’ appraiser. On January 10, 2023, the Insureds’ served a second Civil Remedy Notice on State Farm. In response to the second Civil Remedy Notice filed by the Insureds, State Farm notes there is a dispute as to the amount of loss. Once one party invokes the appraisal process, the other party must participate in the appraisal process to determine the amount of the loss. As such, State Farm has agreed to participate in the appraisal process to resolve the claim within the 60-day time-period to “cure” the Civil Remedy Notice. State Farm further notes a dispute as to the scope and amount of the loss is not evidence of “bad faith” claim handling (and the appraisal condition is included in the insurance policy to resolve such a dispute). As to the other boilerplate allegations of wrongdoing in the Notice, these allegations are denied, in full, by State Farm. As to the Insureds’ demand for a “cure”, the amount of the loss will now be determined by the appraisal process, as demanded by the Insureds. Therefore, payment on the claim, if any is owed by State Farm, cannot be issued until the appraisal panel issues an appraisal award. In addition, State Farm’s guidelines are, and will remain, sufficient during the pendency of this claim. State Farm inspected the property, reviewed all submissions for the claim, and communicated with the Insureds, and the Insureds’ representatives, before issuing a claim decision; thus, a proper investigation was completed on the claim, and the implementation of further guidelines is unnecessary. The Insureds are also not entitled to extra-contractual damages, and payment for such damages will not be issued by State Farm. As stated above, a dispute as to the scope and amount of the loss is not evidence of “bad faith” claim handling (and the appraisal condition is included in the insurance policy to resolve such a dispute). Moreover, the Insureds are not entitled to payment of attorneys’ fees and costs as there has not been a rendition of a judgment or decree against State Farm, and in favor of the Insureds. See Fla. Stat. § 627.428 (2022). Finally, any and all accusations made on behalf of the Insureds in the Notice not already denied or refuted in this response are hereby denied by State Farm. State Farm takes very seriously its responsibility to fairly and accurately evaluate damages and to pay what is properly owed under its policies. We trust the foregoing adequately addresses any concerns that you and your clients may have concerning this matter. State Farm Florida Insurance Company does not intend, by this response, to waive any policy or legal defenses and specifically reserves its right to assert all such additional policy and legal defenses at any time. GREEN, MATZNER & KELLNER, P.A. Counsel for State Farm Florida Insurance Company Jay B. Green, Esq. Walter W. Norton, Esq. Gabriela Rodriguez, Esq. 1200 N. Federal Hwy., Suite 301 Boca Raton, FL 33432 561-347-2400
litigation@thefreemanlawfirmpa.com 01-27-2023 This Civil Remedy Notice was filed in error and is withdrawn by the submitter. No further action is required by either party.
Acknowledgement
* The submitter hereby states that this notice is given in order to perfect the rights of the person(s) damaged to pursue civil remedies authorized by Section 624.155, Florida Statutes.

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DFS-10-363
Rev. 10/14/2008