Filing Number: 784971
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| Filing Accepted: 9/30/2024 |
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POINTE SOUTH OF FT. MYERS BEACH CONDOMINIUM ASSOCIATION’S
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First Name |
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| Street Address
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5000 ESTERO BLVD |
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FT. MYERS,
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33931
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| Email Address
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INSURED@MCDONALDBARNHILL.COM |
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Insured |
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POINTE SOUTH OF FT. MYERS BEACH CONDOMINIUM ASSOCIATION’S |
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First Name |
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| Policy # * |
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5817565876 |
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Claim #* |
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05000001179 |
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Attorney is Applicable
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| Last Name* |
GONTRUM
First Name *
RYAN
Initial
L
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| Street Address* |
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505 S. MAGNOLIA AVENUE |
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TAMPA
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FL
33606
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| Email Address * |
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TAL@MCDONALDBARNHILL.COM |
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| Insurer Type
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Authorized Insurer
Unauthorized Insurer
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| Insurer Name |
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| Insurer Name* |
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FRONTLINE INSURANCE UNLIMITED COMPANY
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| Street Address* |
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,
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NAIC Company Code 10074 |
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| Name of individual responsible for violation (if any):*
MARY HAMILTON, STEPHEN FITTS AND PETRINA MOTEN
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| Type of Insurance
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Commercial Property & Casualty
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| Reason for Notice
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Claim Denial
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Claim Delay
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Unsatisfactory Settlement Offer
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Unfair Trade Practice
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Statutory provision(s) which the insurer allegedly violated.
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| 624.155(1)(b)(1) |
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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.
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| 626.9541(1)(i)(3)(a) |
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Failing to adopt and implement standards for the proper investigation of claims.
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| 626.9541(1)(i)(3)(b) |
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Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue.
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| 626.9541(1)(i)(3)(c) |
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Failing to acknowledge and act promptly upon communications with respect to claims.
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Specific policy language that is relevant to the violation.
Enter all words or phrases (one at a time) that should be used to filter.
***ADDITIONAL STATUTORY PROVISIONS ALLEGED TO HAVE BEEN VIOLATED AS FOLLOWS:***
§624.155 (5) No punitive damages shall be awarded under this section unless the acts giving rise to the violation occur with such frequency as to indicate a general business practice and these acts are:
(a) Willful, wanton, and malicious;
(b) In reckless disregard for the rights of any insured; or
(c) In reckless disregard for the rights of a beneficiary under a life insurance contract;
(8) The damages recoverable pursuant to this section shall include those damages which are a reasonably foreseeable result of a specified violation of this section by the authorized insurer and may include an award or judgment in an amount that exceeds the policy limits.
§627.70131 Insurer’s duty to acknowledge communications regarding claims; investigation
(1)(a) Upon an insurer’s receiving a communication with respect to a claim, the insurer shall, within 14 calendar days, review and acknowledge receipt of such communication unless payment is made within that period of time or unless the failure to acknowledge is caused by factors beyond the control of the insurer which reasonably prevent such acknowledgement. If the acknowledgement is not in writing, a notification indicating acknowledgement shall be made in the insurer’s claim file and dated. A communication made to or by an agent of an insurer with respect to a claim shall constitute communication to or by the insurer.
(b) As used in this subsection, the term “agent” means any person to whom an insurer has granted authority or responsibility to receive or make such communications with respect to claims on behalf of the insurer.
(c) This subsection shall not apply to claimants represented by counsel beyond those communications necessary to provide forms and instructions.
(2) Such acknowledgement shall be responsive to the communication. If the communication constitutes a notification of a claim, unless the acknowledgement reasonably advises the claimant that the claim appears not to be covered by the insurer, the acknowledgement shall provide necessary claim forms, and instructions, including an appropriate telephone number.
(3) Unless otherwise provided by the policy of insurance or by law, within 10 working days after an insurer receives proof of loss statements, the insurer shall begin such investigation as is reasonably necessary unless the failure to begin such investigation is caused by factors beyond the control of the insurer which reasonably prevent the commencement of such investigation.
(4) For purposes of this section, the term “insurer” means any residential property insurer.
(5) Within 90 days after an insurer receives notice of a property insurance claim from a policyholder, the insurer shall pay or deny such claim unless the failure to pay such claim is caused by factors beyond the control of the insurer which reasonably prevent such payment. Failure to comply with this subsection constitutes a violation of this code.
***Specific policy language that is relevant to the violation***
Frontline Insurance Unlimited Company (Frontline) failed to adequately adjust and pay the claim covered under the subject insurance policy. Specifically, but not limited to, Frontline failed to properly apply the Loss Settlement and Loss Payment provisions of the policy. In addition to the policy sections specifically cited herein, any endorsements or changes to said sections are relevant to the Insured’s claim for civil remedy. There may be additional policy language relevant to this violation that may be discovered.
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Facts and circumstances giving rise to the violation.
Enter all words or phrases (one at a time) that should be used to filter.
Pointe South of Ft. Myers Beach Condominium Association’s (Pointe South) claim results from wind and water damage from Hurricane Ian which occurred on or about September 28, 2022, to the property located at 5000 Estero Blvd. Ft. Myers, FL 33931. This property was insured under policy number 5817565876. The wind from the hurricane ripped off large sections of roof from the main six story condominium building, also ripping off sections of balcony, damaging windows and doors, and otherwise battering the exterior of the property. In turn, this damage resulted in rain pouring down throughout the building. The claim was reported to Frontline Insurance Unlimited Company, D.B.A. Frontline Insurance (Frontline). Frontline assigned the claim number 05000001179. After its initial inspection, Frontline issued payments of only $688,920.51 for the main building, which failed to include any interior damage, and $61,445.16 for building 2. Frontline issued the initial payments in November of 2022, but did not issue any supplemental payments until July of 2023.
Following the loss, Frontline also sent HAAG Engineering to evaluate the damage. HAAG Engineering is well known in the industry for creating biased reports which cater to insurers by using exclusionary policy language. Insurers then use these reports to deny or underpay claims. This instance was no different, and HAAG concluded that none of the windows required complete replacement, instead proposing they be cleaned, and some reglazed with hardware repairs. HAAG also concluded that there was no wind related damage to the elevator, despite the storm surge only affecting the bottom levels of the elevator.
Months after its initial payment, Frontline desk adjuster Mary Hamilton sent a supplemental payment letter attached to a new estimate prepared by Stephen Fitts and approved by Petrina Moten. This new estimate made few improvements to the exterior scope of the first estimate, with the majority of the additions being for the interior, where Mr. Fitts included mostly just drywall and insulation repairs. This estimate also reflected simply cleaning most of the windows rather than replacing them. Pursuant to this estimate, Frontline issued supplemental payments of just $44,965.79 for the main building, $638.45 for building 2 and $120,950 for mitigation, which supposedly covered all interior wind damages.
Pointe South retained Serv Pro to conduct water mitigation services which totaled $963,932.40. Frontline sent Keystone Experts + Engineers (Keystone) to evaluate the mitigation services. Keystone, for its part, evaluated Serv Pro’s documentation and concluded that payment for their services should be $952,446.23, a difference of $11,486.17. Accordingly, Frontline failed to pay the full amount invoiced by Serv Pro.
Pointe South hired MAF, Inc. d/b/a Ironclaim (“Ironclaim”) to represent its interests in the claim. Ironclaim inspected the property and assisted with the preparation of a proof of loss totaling $2,827,590.25. By this time, a different desk adjuster, Kristin Fitch had been assigned by Frontline. Ms. Fitch advised that Frontline disagreed with the proof of loss, but also indicated that she would have to review Ironclaim’s estimate to identify the dispute, demonstrating that Frontline disputed the proof of loss without even knowing what was included. After requesting a reinspection and coordinating the date and time, Ms. Fitch indicated that she did not have approval for reinspection after all, and Frontline never wound up reinspecting. After this, Ms. Fitch was taken off the claim and a new desk adjuster, Kim Gateb was assigned. Ironclaim reached out to Ms. Gateb about a reinspection, but after agreeing to look over the file, Ms. Gateb never responded.
Several weeks later, yet another adjuster, James Carpenter, was assigned to the claim. Mr. Carpenter issued correspondence asserting that the proof of loss was improper, but included no details about what was in dispute, and incorrectly referred to the property as a five-story building. After Ironclaim followed up with Mr. Carpenter several times to no avail, yet another desk adjuster was assigned, Carol Crump. Ms. Crump indicated they would send Mike Rega to provide a supplemental evaluation. Ironclaim and Mr. Rega began working together to discuss the claim and damage, and Mr. Rega indicated that his report would soon be completed, but that he needed guidance from Ms. Crump. With Mr. Rega’s report seemingly on the way, Ms. Crump then reassigned the claim to a different consultant, wasting all of the time and effort spent working on the claim with Mr. Rega. Instead, Frontline had RMC Group begin reevaluating the loss. Even though Ironclaim and RMC group had concurred that the supplemental estimate would total more than $1 million, the RMC estimate produced by Frontline included only 11-line items and totaled just $761,519.07. This estimate did not include the full scope of the loss, addressing just the exterior and the elevator. The RMC estimate yielded a supplemental payment of only $265,663.10, the last payment issued by Frontline on this claim. It did not include any interest, and did not address any of the deficiencies of the interior damage estimate besides the elevator. Unfortunately, there is no proof the carrier ever actually considered the information sent by Ironclaim or did anything further to adjust the loss. In fact, it is evident that Frontline has “pulled the rug out” on the insured, Ironclaim, and even its own consultants on this claim on multiple occasions whether through malice or recklessness.
In Florida, the work of adjusting insurance claims engages the public trust. Frontline has breached this duty in the adjustment of this loss by refusing to provide proper indemnity, failing to make payments it is aware are owed, unnecessarily delaying resolution of the claim, and failing to take into consideration documentation provided to them which would support further compensation. Frontline has failed to create and implement adequate guidelines for proper investigation of claims handling and for training and supervision of employees and representatives which have resulted in some of the statutory violations set forth above.
Frontline charged Pointe South a substantial premium for these coverages but has refused to tender proper payment when under all circumstances it could have and should have done so had it acted fairly and honestly. Additionally, it appears this is done companywide. The Insured has been forced to consider legal counsel to protect his interests.
Therefore, to cure the defects outlined in this Civil Remedy Notice, Frontline must:
1. Immediately tender all insurance monies due to the Insureds for the loss;
2. Act fairly and honestly towards the Insureds and with due regard for their interests in attempting to settle the claim;
3. Pay statutory interest on the amount of unpaid contractual damages from the date the claim was reported;
4. Cease and desist all present and future bad faith actions with regard to the Insureds’ claim;
Failure to cure all defects during the 60-day safe harbor period may result in additional extra-contractual damages.
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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.
Before submitting a Notice using this system, please verify that all text has been entered
correctly and completely. Once the Notice has been submitted, the text cannot be changed
or deleted.
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DFS-10-363
Rev. 10/14/2008
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