Civil Remedy Notice of Insurer Violations
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Filing Number:     788247
Filing Accepted:  10/23/2024
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Complainant
Last/Business Name *  
PRIDE CLEAN RESTORATION INC.   First Name  
Street Address * 6511 NOVS DR. #294
City, State Zip * DAVIE, FL 33317
Email Address * ERIK@DIENERFIRM.COM
Complainant Type: * Other
Insured
Last/Business Name*   STUCKEY   First Name   GEORGE
Policy # * FPH3-000051417 Claim #* 01-11792
Attorney
Attorney is Applicable
Last Name* DIENER First Name * ERIK Initial D
Street Address* 5599 S. UNIVERSITY DR. #305
City, State Zip* DAVIE , FL 33328
Email Address * ERIK@DIENERFIRM.COM
Violation
Insurer Type *   Authorized Insurer Unauthorized Insurer
 
Insurer Name*   FIRST PROTECTIVE INSURANCE COMPANY
NAIC Company Code 10897
 
Name of individual responsible for violation (if any):* UNKNOWN
Type of Insurance * Residential Property & Casualty   
Reason for Notice *
Claim Denial
Claim Delay
Unsatisfactory Settlement Offer
Unfair Trade Practice
* 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.
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)(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.
* Specific policy language that is relevant to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

SECTION I - PERILS INSURED AGAINST COVERAGE A - DWELLING and COVERAGE B - OTHER STRUCTURES We insure against risk of direct loss to property described in Coverages A and B only if that is a physical loss to property. . . . LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE . . . SECTION I - PROPERTY COVERAGES ADDITIONAL COVERAGES The following Additional Coverage 12. is added: 12. "Fungi", Wet Or Dry Rot, Or Bacteria a. The amount shown in the Schedule above is the most we will pay for: (1) The total of all loss payable under Section I - Property Coverages caused by "fungi", wet or dry rot, or bacteria; (2) The cost to remove "fungi", wet or dry rot, or bacteria from property covered under Section I - Property Coverages; (3) The cost to tear out and replace any part of the building or other covered property as needed to gain access to the "fungi", wet or dry rot, or bacteria; and (4) The cost of testing of air or property to confirm the absence, presence or level of "fungi", wet or dry rot, or bacteria, whether performed prior to, during or after removal, repair, restoration or replacement. The cost of such testing will be provided only to the extent that there is a reason to believe that there is the presence of "fungi", wet or dry rot, or bacteria. b. The coverage described in 12.a. only applies when such loss or costs are a result of a Peril Insured Against that occurs during the policy period and only if all reasonable means were used to save and preserve the property from further damage at and after the time the Peril Insured Against occurred. c. The Each Covered Loss amount shown in the Schedule for this coverage is the most we will pay for the total of all loss or costs payable under this Additional Coverage resulting from any one covered loss; and The Policy Aggregate amount shown in the Schedule for this coverage is the most we will pay for the total of all loss or costs payable under this Additional Coverage for all covered losses, regardless of the number of locations insured under this endorsement or number of claims made. d. If there is covered loss or damage to covered property, not caused, in whole or in part, by "fungi", wet or dry rot, or bacteria, loss payment will not be limited by the terms of this Additional Coverage except to the extent that "fungi", wet or dry rot, or bacteria causes an increase in the loss. Any such increase in the loss will be subject to the terms of this Additional Coverage. This coverage does not increase the limit of liability applying to the damaged covered property.
 
* Facts and circumstances giving rise to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

Pride Clean submitted a $35,878.00 invoice to the insurer for work performed for its insured under an assignment of benefits. The invoice was prepared using Xactimate and is in Xactimate format. Xactimate categorized the services performed by Pride Clean as "General Demolition", "Hazardous Material Remediation", "Labor Only", and "Water Extraction & Remediation". Xactimate attributed $6,005.76 of Pride Clean's invoice to "Hazardous Material Remediation", or mold remediation services. The insurer paid a portion of Pride Clean's invoice alleging the entire invoice is subject to the policy's $10,000 special limit of liability for mold remediation services even though mold remediation services only increased the loss by $6,005.76. The insurer has presented no evidence or witnesses who can testify the presence of mold increased the loss by more than $6,005.76. The policy specifically states, "If there is covered loss or damage to covered property, not caused, in whole or in part, by 'fungi', wet or dry rot, or bacteria, loss payment will not be limited by the terms of this Additional Coverage except to the extent that 'fungi', wet or dry rot, or bacteria causes an increase in the loss. Any such increase in the loss will be subject to the terms of this Additional Coverage." The insurer filed a motion for sanctions against Pride Clean pursuant section 57.105, Florida Statutes, alleging Pride Clean's lawsuit to recover the balance of its invoice is without merit or "frivolous". An in-person, evidentiary hearing was held on the insurer's motion. The insurer's corporate representative testified under oath at the hearing. The insurer's corporate representative was asked whether the insurer ever considered subparagraph "d." of the "LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE" endorsement when determining how much was owed toward Pride Clean's invoice. The corporate representative testified under oath that she does not know what subparagraph "d." means because she is not a lawyer even though the policy is printed in plain English and is clear and unambiguous. The insurer's corporate representative did not have any personal knowledge regarding any issue in dispute in the lawsuit. Not surprisingly, the court denied the insurer's motion for sanctions writing ". . . the evidence and testimony at the hearing failed to establish that the suit was clearly devoid of merit on the facts and the law and instead indicated that the possibility of justiciable issues existed at the inception of the filing of the complaint." The insurer filed a motion for rehearing, which the court denied. The insurer recently filed another motion for sanctions making the same arguments previously rejected twice by the court. The insurer has no evidence that the presence of mold increased the loss by more than $6,005.76. The insurer is choosing to maliciously pursue motion after motion seeking sanctions against Pride Clean and its counsels instead of paying what is clearly owed under the policy. The insurer routinely ignores subparagraph "d." of the "LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE" endorsement when applying the endorsement's $10,000 special limit of liability to save money and to cheat insureds and/or their assignees out of benefits they are owed under their respective policies. This is the insurer's regular business practice. The insurer will spend multiples of what the insurer owes under a policy on defense counsel rather than pay what is owed under the policy. The insurer violated sections 626.9541(1)(i)(3)(a) and 626.9541(1)(i)(3)(b) by failing to train its representatives how to properly interpret subsection "d." of the LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE endorsement and by intentionally misinterpreting and misapplying the $10,000 LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE limit to save money and to cheat insureds and/or their assignees. The insurer violated sections 624.155(1)(b)(1); 626.9541(1)(i)(3)(d); and 626.9541(1)(i)(3)(f) by intentionally continuing to misinterpret and misapply the $10,000 LIMITED FUNGI, WET OR DRY ROT, OR BACTERIA COVERAGE limit to save money and to cheat Pride Clean after the insurer was shown that mold increased the loss by only $6,005.76 and the balance of Pride Clean's invoice is owed. The insurer can correct the foregoing violations by paying Pride Clean $27,764.15 (which was calculated as follows: $35,878 invoice - $6,980 prior payment - $1,133.85 costs judgment = $27,764.15 outstanding amount owed to Pride Clean) and stipulating to Pride Clean's entitlement to attorney fees under section 627.428, F.S. (2019) and taxable litigation costs pursuant to section 57.041, F.S. (2019).
Comments
User Id Date Added Comment
kfernandes@kelleykronenberg.com 12-07-2024 Frontline denies any of its actions have resulted in any violation(s) of Florida's bad faith laws, including sections 624.155 and 626.9541, Florida Statutes, as alleged in the civil remedy notice. Instead, Frontline has acted in good faith in its investigation and payment of this claim, and in defense of litigation brought under this claim. While Frontline welcomes the opportunity to respond to this civil remedy notice and explicitly denies every allegation contained in the civil remedy notice referenced above, Frontline asserts the civil remedy notice is deficient as it fails to comply with several of the requirements of the civil remedy notice provisions found in section 624.155, Florida Statutes, and Florida case law. Under Florida law, a first-party bad-faith action is not recognized under common law. Baxter v. Royal Indemnity Co., 285 So.2d 652 (Fla. 1st DCA 1973). In 1982, the Florida Legislature enacted §624.155, which created a statutory first-party bad-faith cause of action by an insured (or an insured’s assignee such as the complainant) against the insurance carrier. See §624.155, Fla. Stat.; State Farm Mut. Auto. Ins. Co. v. Laforet, 658 So.2d 55, 59 (Fla. 1995). As a derogation of common law, this statute is strictly construed. Nowak v. Lexington Ins. Co., 464 F. Supp.2d 1248 (S.D. Fla. 2006); Aetna Cas. & Sur. Co. v. Buck, 594 So.2d 280, 281 (Fla. 1992) (stating that a person seeking the benefit of a statutorily created remedy has to strictly comply with the requirements of the statute because the remedy is "purely a creature of statute"). The Florida Supreme Court has specifically applied this rule of construction to section 624.155. See Talat Enterprises, Inc. v. Aetna Casualty and Surety Co., 753 So.2d 1278, 1283-4 (Fla. 2000). As stated by the Florida Supreme Court, the purpose of a Notice is to put the insurer on notice of an alleged violation, the circumstances surrounding same, and indicate the details of the alleged violation in order to provide an insurer with 60 days to "cure" the alleged claim defects. Id. The purpose of section 624.155, Florida Statutes, is to provide the insurer with an opportunity to resolve a first-party coverage dispute and otherwise avoid litigation. Id; see also Lane v. Westfield Ins. Co., 862 So.2d 744 (Fla. 5th DCA 2003). Here, the complainant initially sought benefits from Frontline in 2018 and was paid pursuant to Frontline’s policy limits in an endorsement entitled “Limited Fungi, Wet or Dry Rot, or Bacteria Coverage.” Thereafter, the complainant pursued litigation against Frontline for the payment of additional money beyond the policy endorsement limit from June 29, 2019, until September 6, 2023, when the complainant voluntarily dismissed its lawsuit against Frontline on the eve of trial. During the course of that litigation, Frontline deposed the complainant’s corporate representative, who testified under oath that absolutely all of the work performed by the complainant was related to mold remediation. In fact, the estimate prepared by the complainant was referenced, line by line, in the corporate representative’s deposition and he testified, line by line, that each entry was for mold remediation. Also during the course of that litigation, the complainant deposed no one and presented no evidence to support their four-year pursuit of more money from Frontline in excess of the policy limit already paid by Frontline. The relevant statute requires the complainant’s civil remedy notice to: [S]tate with specificity the following information . . . (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 such violation[;] (3) the name of any individual involved in the violation[;] (4) reference the specific policy language that is relevant to the violation, if any . . . [;] (5) a statement that the notice is given in order to perfect the right to pursue the civil remedy authorized by this section. §624.155(3)(a), Fla. Stat. This statute has been interpreted to require that the Notice be sufficiently specific to provide the insurer with an opportunity to cure the alleged violations. This would include i) identifying the specific policy provision(s) at issue, ii) citing the specific language of the statutory provision(s) the insurer allegedly violated, and iii) specifically identifying what actions the insurer must take to remedy the alleged violations. Rousso v. Liberty Surplus Ins. Corp., 2010 WL 7367059 (S.D. Fla. 2010); Heritage Corp. of S. Fla. v. Nat’l Union Fire Ins. Co. of Pittsburg, PA, 580 F. Supp.2d 1294, 1299-1300 (S.D. Fla. 2008). In addition, providing vague reference to the policy is insufficient to put the insurer on notice of its alleged policy violation. See Julien v. United Prop. & Cas. Ins. Co., 311 So.3d 875, 879 (Fla. 4th DCA 2021). The complainant alleges that Frontline violated the following statutes and applicable language and Frontline responds accordingly: 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 towards its insured and with due regard for his or her interests. Response: Denied. There are no facts, nor specificity, demonstrating how Frontline failed to operate in good faith. Frontline conducted a complete, thorough, and timely investigation of the loss utilizing an independent adjuster to inspect the Property and determine whether a covered loss occurred. Based upon the investigation, Frontline issued a payment to the complainant which exhausted the mold limit under the pertinent policy endorsement applicable to the claim. Based upon payments which exhausted the policy limit under the relevant endorsement, Frontline owes no more money to the complainant, including settlement money. Furthermore, Frontline’s insured, George Stuckey, obtained mold remediation services for his property which were covered by his Frontline policy. Therefore, Frontline acted fairly and honestly towards its insured, George Stuckey, and toward the insured’s assignee, the complainant, and no violations of §624.155(1)(b)(1) have occurred. 626.9541(1)(i)(3)(a) Failing to adopt and implement standards for the proper investigation of claims. Response: Denied. The complainant provides no specific allegations regarding what standards were violated or what acts constituted an improper investigation other than conclusory statements. There is no record evidence supporting these conclusory statements. Additionally, Frontline has adopted all proper and best practices and standard operating procedures for claims handling with regard to §626.9541(1)(i)(3)(a). Frontline conducted a complete, thorough, and timely investigation and paid the mold remediation limit under the policy. Frontline’s defense in the litigation instituted by the complainant resulted in the sworn testimony of the complainant’s corporate representative that all of the complainant’s work fell under the mold remediation policy endorsement, which was exhausted in payments made by Frontline. Therefore, no violations of §626.9541(1)(i)(3)(a) have occurred. 626.9541(1)(i)(3)(b) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue. Response: Denied. There are no specific allegations to support a misrepresentation. The complainant makes no reference to any misrepresentation other than a general conclusion that Frontline failed to properly apply subsection “d” of its policy endorsement under this claim. The complainant takes no responsibility for its sole testimony admitting that its services fell under the limit established in the policy endorsement. 100% of the complainant’s sworn testimony supports Frontline’s payments being limited to the $10,000 cap provided in the policy endorsement. The complainant’s allegations of a misrepresentation are deficient as a matter of law. Frontline has not misrepresented any policy provisions and has provided the complainant with express language from the policy endorsement to explain the results of its investigation and the payment made to the complainant. Therefore, no violations of §626.9541(1)(i)(3)(b) have occurred. 626.9541(1)(i)(3)(d) Denying claims without conducting reasonable investigations based upon available information. Response: Denied. Once again, the complainant provides no specific allegations regarding what led to its conclusion that an unreasonable investigation was conducted. This conclusion must be supported by specific allegations. Additionally, Frontline has adopted all proper and best practices and standard operating procedures for claims handling with regard to §626.9541(1)(i)(3)(d). Frontline conducted a complete, thorough, and timely investigation and paid the policy endorsement limit for the complainant’s mold remediation work. The only evidence provided by the complainant to Frontline during Frontline’s investigation of the claim and defense of the complainant’s lawsuit was an invoice exceeding the policy endorsement amount and unequivocal testimony that all of the invoiced work pertained to mold remediation covered by the policy endorsement. The complainant presented nothing else in support of its position in the litigation, other than its counsel’s legal arguments made during proceedings for sanctions against the complainant. Therefore, no violations of §626.9541(1)(i)(3)(d) have occurred. 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. Response: Denied. Again, there is no factual support for this allegation. This is a blanket assertion with no specificity to allow Frontline to investigate this claim. On the contrary, a claim decision was issued and payment was made to the complainant which exhausted the limit provided in the policy endorsement for mold remediation. This was expressly stated in Frontline’s correspondence issued to the complainant at the time of the payment. Relevant to this statutory provision, no denial of the claim was issued by Frontline and no offer of a compromise settlement was issued by Frontline. Frontline paid the policy limit for the work performed by the complainant. On the eve of trial, the complainant asserted for the first time through counsel that only $6,005.76 of its entire invoice was subject to the mold remediation policy endorsement and the remainder of the invoice should have been paid under other policy provisions. Then, after stating this position for the first time through counsel on the eve of trial, the complainant voluntarily dismissed its own lawsuit and erased its eleventh-hour legal argument from the litigation. Thereafter, the complainant filed a new lawsuit and revived its argument anew, but the argument is still not supported by the record evidence gathered in the prior litigation, and no further record evidence has been gathered or disclosed in the new litigation initiated by the complainant five years after this claim was opened. The CRN is insufficient on its face and should be rejected since, contrary to the requirements of section 624.155, Florida Statutes, the CRN does not specifically describe the facts or circumstances giving rise to each specific violation alleged against Frontline. The civil remedy notice asserts five statutory violations and generally asserts violations of section one (1) coverage and additional coverages under the policy without any factual support. The CRN makes generalized, unsupported, and incorrect statements without specifically identifying the facts that give rise to each allegation pursuant to the cited statutory provisions. In fact, the CRN seems to assert that Frontline is guilty of violating the statutory provisions cited in the CRN because Frontline has pursued sanctions against the complainant for frivolous litigation. There is no nexus to any of the above alleged statutory violations within the narrative to provide any notice to Frontline of the violations allowing for time to cure. Notwithstanding the deficiencies, Frontline denies that it acted in any manner that would have violated the statutes cited or any other statutory provisions, and it asserts this is another reason why the CRN should be rejected. Frontline adamantly denies each and every allegation outlined in the CRN of insurer violation. The complainant also fails to state any factual basis for bad faith. A review of the CRN narrative fails to set forth any specific acts of misconduct or otherwise advise Frontline of specific facts underlying the alleged insurer violations. Frontline’s pursuit of sanctions against the complainant does not constitute bad faith, nor does it constitute a violation of any of the statutory provisions cited in the CRN.
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