Civil Remedy Notice of Insurer Violations
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Filing Number:     786802
Filing Accepted:  10/14/2024
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Complainant
Last/Business Name *  
AVELINO COSTA   First Name   JOSEMY
Street Address * 2800 CHERRY BLOSSOM LOOP
City, State Zip * ST. CLOUD, FL 34771
Email Address * INTAKE2@THEKRFIRM.COM
Complainant Type: * Insured
Insured
Last/Business Name*   AVELINO COSTA   First Name   JOSEMY
Policy # * ATH1092476 Claim #* AH141850
Attorney
Attorney is Applicable
Last Name* KADIR First Name * ALI Initial A.
Street Address* 986 DOUGLAS AVE, STE. 102
City, State Zip* ALTAMONTE SPRINGS , FL 32714
Email Address * INTAKE2@THEKRFIRM.COM
Violation
Insurer Type *   Authorized Insurer Unauthorized Insurer
 
Insurer Name*   AMERICAN TRADITIONS INSURANCE COMPANY
NAIC Company Code 12359
 
Name of individual responsible for violation (if any):* SARAH AARON, STORM KING CLAIMS SERVICES LLC, SLEUTH INC., AND ALL AMERICAN TRADITIONS CLAIMS ADJUSTERS, EMPLOYEES, REPRESENTATIVES, AGENTS, VENDORS, AND/OR ENGINEERS WHO HANDLED THE CLAIM.
Type of Insurance * Residential Property & Casualty   
Reason for Notice *
Claim Denial
Claim Delay
Unsatisfactory Settlement Offer
Unfair Trade Practice
Other : Misrepresentation
* 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)(e) Failing to affirm or deny full or partial coverage of claims, and, as to partial coverage, the dollar amount or extent of coverage, or failing to provide a written statement that the claim is being investigated, upon the written request of the insured within 30 days after proof-of-loss statements have been completed.
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.
Enter all words or phrases (one at a time) that should be used to filter.

“We insure against risk of direct loss to property described in Coverages A and B only if that loss is a physical loss to property.” American Traditions possesses a complete copy of the subject insurance policy. Ms. Avelino Costa is not in possession of a complete copy of the subject policy and is requesting a copy from American Traditions. Thus, this CRN cannot cite subject policy language verbatim due to such. Notwithstanding, the subject policy is an all-risks insurance policy and the applicable policy language is the provision regarding coverage of all risks for the dwelling (Language such as “We insure against direct physical loss to property…”, “We insure against risk of direct loss to property…”, among other similar policy language etc. is typically used.) and provisions regarding exclusions or limitations to this all-risks provision.
 
* Facts and circumstances giving rise to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

Josemy Avelino Costa is a homeowner insured with an all-risks policy issued by American Traditions Insurance Company (“American Traditions”). The insured property or home is located at 2800 Cherry Blossom Loop, St. Cloud, Florida 34771. In July of 2024, a pipe break caused extensive damage to Ms. Avelino Costa’s home. Ms. Avelino Costa timely reported an insurance claim for this damage to American Traditions and fully cooperated with all requests for inspections. She provided all requested documentation, if any, and complied with all post loss policy conditions. A Leak Detection invoice and an estimate for repair of all damages were prepared on her behalf totaling $103,031.05 and were submitted to American Traditions. After reporting the claim, American Traditions retained an unqualified and biased field adjuster who has a financial relationship with American Traditions. This field adjuster inspected Ms. Avelino Costa’s home in an apparent effort to minimize American Traditions’ losses instead of adjusting the claim in good faith in due regard for Ms. Avelino Costa’s interests. American Traditions also hired a biased Leak Detection Company, Sleuth, Inc. (“Sleuth”), who has a financial relationship with American Traditions. Like the field adjuster, this Leak Detection technician’s goal was to provide incorrect and erroneous findings; again in an apparent effort to minimize American Traditions’ losses to the detriment of Ms. Avelino Costa. Indeed, Sleuth incredulously found “no evidence of any active pressurized water leaks.” Rather, Sleuth stated that the damage was due to ‘long-term leakage.” Based on these findings, American Traditions completely denied coverage for Ms. Avelino Costa’s claim. Due to such bad faith claim handling, Ms. Avelino Costa has been unable to permanently repair her home. Based on these facts, it is clear American Traditions unreasonably denied coverage for Ms. Avelino Costa’s claim in bad faith. It denied coverage for the claim without conducting a reasonable investigation based upon the available information. It misrepresented pertinent policy provisions and facts and did not act fairly and honestly with Ms. Avelino Costa in due regard for her interests. American Traditions also delayed the claim and failed to timely respond to communications. It further failed to adopt and implement standards for the proper investigation of this claim. This has become a common business practice of American Traditions. Florida Statute § 624.02 defines insurance as a contract whereby one undertakes to indemnify another or pay or allow a specified amount or a determinable benefit based on determinable contingencies. Inherent is the fact that payment must be made timely and promptly so that insureds may mitigate their damages and be put back into the position they were in prior to the loss as quickly as possible. American Traditions has breached this duty by refusing to properly and timely adjust the loss. As a result, Ms. Avelino Costa will have no choice but to retain the undersigned counsel to file a lawsuit against American Traditions. American Traditions has more than enough information and is still refusing to accept coverage for this claim. This continued and repeated reckless claim delay and denial of coverage will result in a significant punitive damage award if a bad faith lawsuit is filed. American Traditions can avoid a lawsuit for bad faith by immediately accepting full coverage under the subject insurance policy for this claim and by paying Ms. Avelino Costa based on her $103,031.05 estimate and invoice.
Comments
User Id Date Added Comment
Jamie@bcflalaw.com 12-13-2024 December 13, 2024 VIA EMAIL: Josemy Avelino Costa c/o Ali A. Kadir intake2@thekrfirm.com RE Policyholders: Avelino Costa Claim Number: AH141850 Policy Number: ATH1092476 CRN Filing Number: 786802 Dear Attorney, Kadir: This is the formal response of American Traditions Insurance Company (“ATIC”) to the purported Civil Remedy Notice of Insurer Violations (“Purported Notice”) that was filed on behalf of Josemy Avelino Costa. The Florida Department of Financial Services accepted the Purported Notice, in form only, on October 14, 2024. The Purported Notice was filed in connection with Josemy Avelino Costa’s insurance claim for property damage. The Purported Notice names ATIC and alleges claim denial, claim delay, unsatisfactory settlement offer, unfair trade practice, and misrepresentation allegedly in violation of 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)(e), 626.9541(1)(i)(3)(f), 626.9541(1)(i)(3)(g), 626.9541(1)(i)(3)(h) Florida Statutes. The Purported Notice is a legal nullity for the four reasons discussed below. ATIC reserves all (and waives none) of its rights or defenses, including its right to assert additional deficiencies in the Purported Notice. Under Section 624.155(3), Florida Statutes, a claimant must file a notice with the Florida Department of Financial Services (“the Department”) at least 60 days before filing a Statutory “bad faith” lawsuit. This notice is commonly referred to as a “civil remedy notice” (“CRN”). Section 624.155(3), Florida Statutes sets out five pieces of information which must be included in a CRN: 1. The statutory provision, including the specific language of the statute, which the authorized insurer allegedly violated; 2. The facts and circumstances giving rise to the violation; 3. The name of any individual involved in the violation; 4. Reference to specific policy language that is relevant to the violation, if any. If the person bringing the civil action is a third-party claimant, she or he shall not be required to reference the specific policy language if the authorized insurer has not provided a copy of the policy to the third party claimant pursuant to written request; and 5. A statement that the notice is given in order to perfect the right to pursue the civil remedy authorized by this section. The statute also provides that, in addition to these five requirements, the CRN shall be “on a form provided by the [Department] and shall state with specificity . . . such other information as the department may require.” (emphasis added); The Florida Supreme Court has held that Section 624.155, Florida Statutes “must be strictly construed.” Talat Enterprises, Inc. v. Aetna Cas. and Sur. Co., 753 So. 2d 1278, 1283 (Fla. 2000). Strict construction is appropriate as “this statute is in derogation of the common law.” Id. When interpreting a statute in derogation of the common law, “[a] court will presume that such a statute was not intended to alter the common law other than as clearly and plainly specified in the statute.” Time Ins. Co., Inc. v. Burger, 712 So. 2d 389, 393 (Fla. 1998). Accordingly, such an interpretation would mean that statutory bad faith cases cannot proceed unless the claimant has specifically complied will all statutory requirements. Deficiency #1 Section 624.155(3)(b)(2), Florida Statutes, requires that the CRN state with specificity the facts and circumstances giving rise to the violation. The Purported Notice does not supply specific facts or circumstances that explain the allegations and fails to explain how the purported facts constitute violations of Florida law. Thus, the Purported Notice is invalid for noncompliance with Section 624.155(3)(b)(2), Florida Statutes. This deficiency applies to all allegations in the Purported Notice, including but not limited to claim denial, claim delay, unsatisfactory settlement offer, unfair trade practice, and misrepresentation allegedly in violation of 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)(e), 626.9541(1)(i)(3)(f), 626.9541(1)(i)(3)(g), 626.9541(1)(i)(3)(h) Florida Statutes. Deficiency #2 Section 624.155(3)(b)(3), Florida Statutes requires that the name of any individual involved in the violation be stated with specificity. The Purported Notice lists one individual but continues by including “Storm King Claim Services, LLC, Sleuth Inc., and all American Traditions claims Adjusters, employees, representatives, agents, vendors, and/or engineers who handled the claim.” Thus, the Purported Notice is invalid for noncompliance with Section 624.155(3)(b)(3), Florida Statutes. This deficiency applies to all allegations in the Purported Notice, including but not limited to claim denial, claim delay, unsatisfactory settlement offer, unfair trade practice, and misrepresentation allegedly in violation of 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)(e), 626.9541(1)(i)(3)(f), 626.9541(1)(i)(3)(g), 626.9541(1)(i)(3)(h) Florida Statutes. Deficiency #3 Section 624.155(3)(b)(4), Florida Statutes, requires the CRN to reference specific policy language that is relevant to the violation, if any. If the person bringing the civil action is a third-party claimant, she or he shall not be required to reference the specific policy language if the authorized insurer has not provided a copy of the policy to the third-party claimant pursuant to written request. Your client is not a third-party claimant; therefore, the Purported Notice must include specific language from the subject policy that is relevant to the alleged violations. It does not. The Purported Notice alleges several “policy-related” violations; therefore, it must cite the policy language that is relevant to such violations. For example, the Purported Notice alleges that American Traditions “misrepresented pertinent policy provisions” but does not cite which provisions were allegedly misrepresented. Thus, the Purported Notice is invalid for noncompliance with Section 624.155(3)(b)(4), Florida Statutes. This deficiency applies to all allegations in the Purported Notice, including but not limited to claim denial, claim delay, unsatisfactory settlement offer, unfair trade practice, and misrepresentation allegedly in violation of 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)(e), 626.9541(1)(i)(3)(f), 626.9541(1)(i)(3)(g), 626.9541(1)(i)(3)(h) Florida Statutes. On March 3, 2021, the Fourth District Court of Appeal issued a relevant opinion in Junior Julien v. United Property and Casualty Insurance Company, No. 4D19-2763. In Julien, the insured appealed the circuit court’s dismissal of his lawsuit against his insurer, finding that the insured’s Civil Remedy Notice (“CRN”) failed to satisfy the statutory requirement that an insured “state with specificity” the policy language and the statutory provisions at issue. In his CRN, the insured cited numerous statutory provisions and listed nearly every provision in the insurance policy. On appeal, the Fourth District affirmed the dismissal and agreed with the circuit court that the CRN failed to specify the statutory and policy provisions at issue. Like the CRN in Julien, the Purported Notice fails to “state with specificity” the policy language at issue. Deficiency #4 The Purported Notice does not supply necessary information that would allow ATIC to “cure” the alleged violations, as required by Florida law. In Talat Enter., Inc. v. Aetna Cas. and Sur. Co., 753 So. 2d 1278, 1283 (Fla. 2000), the Florida Supreme Court stated that alleged statutory violations may be “cured,” in the context of a first-party insurance claim, by payment of “the contractual amount due the insured” within the 60 days following the acceptance of a valid notice. The Purported Notice improperly and indirectly demands payment for attorneys’ fees as a lawsuit was filed prior to the expiration of the cure period and this monetary demand is made while such lawsuit is pending. Despite the monetary demand, the Purported Notice commingles both monetary and non-monetary demands by requiring ATIC to “[accept] full coverage under the policy… [and pay an amount based on an estimate].” However, the Purported Notice does not tell ATIC what amount your client would accept as a “cure.” This deficiency applies to all allegations in the Purported Notice, including but not limited to claim denial, claim delay, unsatisfactory settlement offer, unfair trade practice, and misrepresentation allegedly in violation of 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)(e), 626.9541(1)(i)(3)(f), 626.9541(1)(i)(3)(g), 626.9541(1)(i)(3)(h) Florida Statutes. Notwithstanding the deficiencies in, and the invalidity of, the Purported Notice, ATIC denies any wrongdoing. It specifically denies that it violated the insurance policy or Florida Statutes, as alleged in the Purported Notice. Please be advised, by this letter, ATIC neither waives, nor is estopped, from asserting any and all rights it may have in law, or, under the terms of the policy. In fact, ATIC hereby again, expressly, and specifically, reserves all of its rights, without exception or limitation. If you have any questions or concerns with this response, or, regarding any other matter, please contact me in writing. Sincerely, /s/ Joseph A. Buhrts Joseph A. Buhrts BICKFORD & CHIDNESE, LLP 1860 N. Avenida Republica de Cuba Tampa, FL 33605 (813) 576-0096 jbuhrts@bcflalaw.com
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