Civil Remedy Notice of Insurer Violations
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Filing Number:     790607
Filing Accepted:  11/6/2024
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Complainant
Last/Business Name *  
MORANG   First Name   STEPHANIE
Street Address * 168 NORTH CORY DRIVE
City, State Zip * EDGEWATER, FL 32141
Email Address * STEPHANIELMORANG@GMAIL.COM
Complainant Type: * Insured
Insured
Last/Business Name*   MORANG   First Name   STEPHANIE
Policy # * P000088103 Claim #* 252404
Attorney
Attorney is Applicable
Last Name* ABAD First Name * FRANCISCO Initial I
Street Address* 1700 NW 64TH ST #460
City, State Zip* FORT LAUDERDALE , FLORIDA 33309
Email Address * FABAD@SCHILLINGSILVERS.COM
Violation
Insurer Type *   Authorized Insurer Unauthorized Insurer
 
Insurer Name*   SECURITY FIRST INSURANCE COMPANY
NAIC Company Code 10117
 
Name of individual responsible for violation (if any):* LOUIE LENOIR
Type of Insurance * Residential Property & Casualty   
Reason for Notice *
Unfair Trade Practice
Claim Denial
* Statutory provision(s) which the insurer allegedly violated.
 
626.9541(1)(i)(3)(b) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue.
* 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 CONDITIONS 2. Your Duties After Loss. The first paragraph of 2. Your Duties After Loss is deleted and replaced by the following: In case of a loss to covered property, we have no duty to provide coverage under this policy to an “insured”, or to an “assignee”, if the failure of you, an “insured” seeking coverage, an “assignee”, or a representative of any of these to comply with the following duties is prejudicial to us: 2.a.(2) is deleted and replaced by the following: (2) Any claim or “reopened claim”, as those terms are defined in Florida Statute 627.70132, is barred unless notice of the claim was given to us in accordance with the terms of the policy within 2 years after the date of loss. Any “supplemental claim”, as that term is defined in Florida Statute 627.70132 is barred unless notice of the “supplemental claim” was given to us in accordance with the terms of the policy within 3 years after the date of loss.
 
* Facts and circumstances giving rise to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

Stephanie Morang and Mistry Strother (f/k/a Misty Morang) (“Insureds”) purchased an insurance policy (“Policy”) from Security First Insurance Company. Security First issued a Policy bearing policy number P000088103, with policy period of July 27, 2022, to July 27, 2023, for the property located at 168 North Cory Drive, Edgewater, Florida 32141 (“Property”). On September 28, 2022, the Property sustained a substantial loss due to Hurricane Ian. Security First received notice of the claim and assigned claim number 252404 (the “Claim”). On December 7, 2023, a Security First field adjuster and a certified roofer from Southeast Roofing inspected the Property (together known as the “inspectors”). The inspectors observed creased shingles on the roof and leaking. The inspectors recommended that the main roof be replaced. The inspection further revealed ceiling stains in the living room, front bedroom, back bedroom, and garage. Despite these findings, Security First stated that hey were prejudiced by the Insureds’ alleged failure to promptly report the claim. Upon information and belief, the claim was reported on November 30, 2023, which is less than two (2) years after the date of loss. At the time the loss occurred, the Insureds were to report the claim within 2 years after the date of loss. Similarly, Fla. Stat. 627.70132’s applicability at the time of the date of loss stated that notice must be given to the insurer within 2 years after the date of loss. The denial letter also states that “[t]he reported date of loss exceeds the notice requirement pursuant to Fl. Statute 627.70132. This Florida Statute requires that all claims be reported before the expiration of one year from the date of loss.” For years, Florida Statute Section 627.70132 applied only to windstorm and hurricane claims, and it required that a claim “for loss or damage caused by the peril of windstorm or hurricane is barred unless notice of the claim, supplemental claim, or reopened claim was given to the insurer in accordance with the terms of the policy within 3 years after the hurricane first made landfall or the windstorm caused the covered damage.” See Florida Statute Section 627.70132 (2020). Then, effective July 1, 2021, the Statute was amended to apply to all claims, not just windstorm or hurricane. Furthermore, the timeframe for reporting an initial or reopened claim was reduced to 2 years, while still allowing 3 years for supplemental claims. See Florida Statute Section 627.70132 (2021). On December 16, 2022, the Statute was amended yet again, narrowing the timeframe for reporting even further. Now, the Statute provides that initial and reopened claims must be reported within 1 year of the date of the loss, and supplemental claims must be reported within 18 months. See Florida Statute Section 627.70132 (2022). Section 23, ch. 2023-172, provides that “[c]hapter 2022-271, Laws of Florida, shall not be construed to impair any right under an insurance contract in effect on or before the effective date of that chapter law. To the extent that chapter 2022-271, Laws of Florida, affects a right under an insurance contract, that chapter law applies to an insurance contract issued or renewed after the applicable effective date provided by the chapter law. This section is intended to clarify existing law and is remedial in nature.” Here, the subject Policy had a valid policy period of July 27, 2022, through July 27, 2023, and the reported date of loss is September 28, 2022. In fact, the subject Policy provides, in part, that “[i]n the case of a windstorm or ‘Hurricane loss,’ you must give us notice of the initial claim, ‘supplemental claim’ or ‘reopened claim’ within three years after the hurricane first made landfall or the windstorm caused the covered damage.” See Policy, attached as Exhibit “B” to Defendant’s Motion to Dismiss. More importantly, and more concerning, Security First completely ignores a portion of the Office of Insurance Regulation’s Filing Number 22-050476 out of its denial letters or motions filed in discovery. This Filing expresses a refusal to approve Security First’s endorsement to use the new law in existing policies. The Filing, dated January 17, 2023, express tates that the new form/law is APPROVED for use in new business (new policies) starting on February 1, 2023, and renewals starting on February 1, 2023. Therefore, the 1-year requirement of the new statute does not apply to this the subject claim. It is clear that Security First found covered damage to the Property but looked for any possible alternative to not deny the claim and not make a payment under this valid claim. Contrary to the terms of the Policy and applicable Florida law, Security First performed a subpar investigation of the claim to the detriment of the Insureds. Due to Security First’s gross mismanagement of the claim, the failure to properly investigate the loss and adjust this loss in good faith, the Insureds continues to suffer damages. By stating the above detailed facts, it is clear that Security First has violated the following Florida Statutes: 626.9541(1)(i)(3)(b) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue; Security First misrepresented the terms of the Policy; specifically, Security First stated that the Insureds were barred from coverage as they failed to report the claim within 1 year when, in reality, the Insureds had 2 years after the date of loss to report the claim. Here, the claim was reported within 2 years of the date of loss and Security First was able to properly identify the damages reported through 2 inspectors. Based on the above, it is irrefutable evidence that Security First knowingly and intentionally, performs sub-part investigations into its claim in order to further disadvantage the Insureds. The financial detriment caused to the Insured is a direct result of Security First’s reckless investigation. Upon information and belief, the aforementioned action complained of, among others, was made by Security First so often as to constitute a general business practice, evidencing a motive to enhance Security First’s profits, and designed to cause a detrimental effect to its policyholders. The above clearly depicts that Security First adjusted this claim in bad faith and that Security First is in direct violation of Unfair Claims Practices, by knowingly misinterpreting the Policy to the insured. This notice is given in order to perfect the right to pursue the civil remedy authorized by Section 624.155, Florida Statutes, should Security First fail to cure the violations set forth in this Civil Remedy Notice within the given cure period. Therefore, to cure the defects outlined in this Civil Remedy Notice, Security First must: Create and implement adequate guidelines for proper investigation and evaluation as to claims handling and for the training and supervision of employees, which will avoid future statutory violations as set forth above, and to avoid this from occurring in the future; Security First must create and implement adequate guidelines for the proper investigation and evaluation of these types of claims, and for the training and supervision of employees with regard to these types of claims to ensure Security First’s claims handling procedures with regard to these types of losses are adequate; Security First must act fairly and honestly towards the Insureds with due regard for their best interests in attempting to settle the claim; Security First must immediately tender all insurance benefits due and owing to the Insureds under the Policy pursuant to the relevant policy provisions provided therein that would reasonably place the property back to its pre-loss condition, including, but not limited to all interest due and owing under applicable Florida Statutes. The Insureds expect Security First to respond to this CRN stating that it does not comply with Florida Statutes and Security First will ignore the specific allegations herein and fail to refute them with any factual basis. Security First must immediately tender all insurance benefits in the amount of $67,297.95. This represents the balance of all damages, exclusive of attorney’s fees and costs. The Insured still hopes that this claim can be resolved amicably. Failure to cure the defects as described herein will result in additional extra-contractual damages. Should Security First fail to cure the violations set forth in this Civil Remedy Notice within the cure period, Insured reserves the right to seek restitution through litigation.
Comments
User Id Date Added Comment
alexandria.gordon@securityfirstflorida.com 11-13-2024 November 13, 2024 VIA ELECTRONIC FILING: Florida Department of Financial Services Bureau of Consumer Assistance c/o: Civil Remedy Section Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0322 VIA E-MAIL Francisco Abad, Esq. FABAD@SCHILLINGSILVERS.COM 1700 NW 64TH ST #460 FORT LAUDERDALE, FLORIDA 33309 Re: CIVIL REMEDY NOTICE OF INSURER VIOLATION Filing No.: 790607 Insured: STEPHANIE MORANG Insurer: Security First Insurance Company Claim No.: 252404 Policy No.: P000088103 Date of Loss: 9/28/2022 Dear Sir or Madam: This correspondence is in response to the Civil Remedy Notice of Insurer Violations (hereinafter referred to as the “CRN”) filed by Francisco Abad, Esq. on behalf of his client Stephanie Morang (hereinafter referred to as “Insured”). Please be advised that the undersigned attorney has been retained to represent the interests of Security First Insurance Company (hereinafter referred to as “Security First”) with respect to the above-referenced matter. The Florida Department of Financial Services (hereinafter referred to as “Department”) assigned this CRN an acceptance date of November 6, 2024 and DFS File No.: 790607. This matter concerns a property damage claim made by the Insured pursuant to a homeowners’ insurance policy provided by Security First Policy No. P000088103 and assigned Claim No. 252404. As the basis for filing the CRN against Security First, Stephanie Morang asserts in the “Reasons for Notice” section violations such as claim denial, unfair trade practice, along with the following statutory violation: 626.9541(1)(i)(3)(b): Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue; Security First welcomes this opportunity to respond to the CRN and denies each allegation contained therein. The allegations made in the CRN are premature, as the insured has failed to perfect the claim for bad faith and the CRN does not meet the specificity requirement of Section 624.155, Florida Statutes. This CRN does not sufficiently support the allegations stated above. As is standard procedure, upon the first notice of the claim, the subject property was dutifully inspected by an adjuster, which was documented through photographs. I. Perfecting a Claim for Bad Faith SFIC specifically denies all allegations set forth in the Notice. SFIC contends that the Notice should be rejected and returned by the Department of Financial Services as it is premature. Pursuant to statute, there is no potential violation until a breach of contract is established. § 624.1551, Florida Statutes. Accordingly, any Notice filed prior to a finding that SFIC has breached the terms of the policy, is not ripe and is premature and thus fails to perfect the Insureds rights to pursue civil remedies under Florida Statutes. II. Specificity Requirement The Insured’s CRN violates multiple requirements set forth in the Florida courts’ jurisprudence for Civil Remedy Notices. In addition, it fails to meet even the most basic requirements of the Statute. Pursuant to the terms of the statute, (3)(a) As a condition precedent to bringing an action under this section, the department and the authorized insurer must have been given 60 days’ written notice of the violations. Notice to the authorized insurer must be provided by the department to the e-mail address designated by the insurer under s. 624.422. a. The notice shall be on a form provided by the department and shall state with specificity the following information, and such other information as the department may require (emphasis added): b. (3)(a) As a condition precedent to bringing an action under this section, the department and the authorized insurer must have been given 60 days’ written notice of the violations. Notice to the authorized insurer must be provided by the department to the e-mail address designated by the insurer under s. 624.422. i. The statutory provision, including the specific language of the statute, which the authorized insurer allegedly violated. ii. The facts and circumstances giving rise to the violation. iii. The name of any individual involved in the violation. iv. 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. v. A statement that the notice is given in order to perfect the right to pursue the civil remedy authorized by this section. In interpreting this statute, courts have emphasized the importance of filing specific civil remedy notices. The civil remedy notice is “crucial to the procedural integrity of an action” under the Statute. Allstate Ins. Co. v. Clohessy, 32 F.Supp.2d 1328, 1333 (M.D. Fla. 1998). “It is, without a doubt, a condition that must be satisfied in order for one to perfect the right to sue under the statute.” Id. “In creating this statutory remedy for bad- faith actions, the Legislature provided this sixty-day window as a last opportunity for insurers to comply with their claim-handling obligations when a good-faith decision by the insurer would indicate that contractual benefits are owed.” Talat Enterprises, Inc. v. Aetna Cas. & Sur. Co., 753 So. 2d 1284 (Fla. 2000). Thus, the Notice cannot be “vague and ‘shotgun’ in nature,” rather than “the type of specific notice required by the statute that would allow [the insurer] an opportunity to cure.” Heritage Corp. of South Florida v. National Union Fire Ins. Co. of Pittsburgh, PA, 580 F. Supp. 2d 1294, 1299 (S.D. Fla. 2008). Because it is in derogation of the common law, Section 624.155(1)(b), Florida Statutes must be strictly construed. Talat, 753 So. 2d at 1283 (citing Baxter v. Royal Indem. Co., 285 So. 2d 652 (Fla. 1st DCA 1973). To perfect the right to sue under the statute, the insured must specifically notify the insured of any and all alleged violations claimed. Talat Enterprises, Inc. v. Aetna Casualty & Surety Co., 952 F.Supp. 773, 776 (M.D. Fla. 1996) (“Talat I”) See Fox v. Starr Indem. & Liab. Co., No. 8:16-CV-3254-T-23MAP, 2017 WL 1541294, at *2 (M.D. Fla. Apr. 28, 2017) (sufficiency means specificity). In Junior Julien v. United Property and Casualty Insurance Company, 311 So.3d 875, 879 (Fla. 4th DCA 2021), the Honorable Court stated: The Middle District of Florida was confronted with a civil remedy notice that was similarly broad in scope and concluded that listing nearly all policy provisions on the notice did not satisfy the statute. Fox v. Starr Indem. & Liab. Co., No. 8:16-CV-3254-T-23MAP, 2017 WL 1541294, at *2 (M.D. Fla. Apr. 28, 2017). The court explained that “[i]f the statute contained no specificity requirement, [then] the [insureds’] casual ‘reference’ to the entire insurance policy undoubtedly would suffice.” Id. But, the court continued, “the Legislature included ‘specific’ or a variant not once but twice in the statute.” Id. As a result, the insureds’ listing of whole sections of the insurance policy “appear[ed] to lack specificity.” Id. In Valenti, the District Court for the Middle District of Florida considered the practical consequences of an insured’s non-specific civil remedy notice. Valenti v. Unum Life Ins. Co. of America, 2006 WL 1627276 (M.D. Fla. 2006). The plaintiff’s civil remedy notice included allegations that the defendant conducted an inadequate investigation. The plaintiff, however, failed to identify with the requisite specificity the defendant’s actions that were inadequate. The Middle District held that the plaintiff’s civil remedy notice was insufficient, and stated the following: [T]he civil remedy notice must be specific enough to provide insurers notice of the wrongdoing so the insurer can cure the same within sixty days. … Plaintiffs’ counsel, during the hearing in this matter, argued a civil remedy notice that states “you denied my claim” should be sufficient to place the insurer on notice of what was needed to be cured. Plaintiffs’ counsel further argued that it was up to the insurer, as the insurance expert, to decipher what actions needed to be cured. This argument, in this Court's estimation, is illogical and is counter to the purpose of the civil remedy notice. If a simple “you denied my claim” was sufficient to put insurers on notice, the sixty-day cure period would be little more than a guessing game with the insurer attempting to correctly guess what errors the insured claimed it made in the claims handling process, or risk defending a bad faith action. This surely is not what the legislature had in mind when it created the civil remedy notice. Accordingly, this Court finds that Plaintiffs allegation that Defendant failed to conduct an adequate investigation is insufficient to provide Defendant an opportunity to cure. Id. at *2. The guidance for an insured could not be clearer. “The purpose of the civil remedy notice is to give the insurer one last chance to settle a claim with its insured and avoid unnecessary bad faith litigation.” Lane v. Westfield Insurance Co., 862 So. 2d 774, 779 (Fla. 5th DCA 2004). Its purpose is not “to give the insured a right of action to proceed against the insurer even after the insured’s claim has been paid or resolved.” Id. Ultimately, conclusory allegations without facts fail to perfect a statutory bad faith claim. Merely alleging the bare minimum allegations is insufficient pursuant to Florida courts’ interpretations of Section 624.155, Florida Statutes. Complainant’s CRN fails to allege the necessary specific facts to put Security First on notice of its allegations. Specifically, Complainant’s CRN alleges that Security First was only approved by the Office of Insurance Regulation via Filing 22-050476 to only include new policies. However, Security First did receive written approval from the Office of Insurance Regulation to amend and implement the 1 year reporting endorsement mid-term for all policyholders. The CRN then alleges, without supporting facts, that Security First’s investigation was deficient. Complainant’s CRN does not identify any steps in Security First’s investigation which were improper, or any steps Security First should have taken in its investigation and did not. Security First is again left to guess what the Complainant’s concerns are regarding Security First’s investigation. The most obvious example of Complainant’s lack of specificity is its argument that Security First mismanaged and failed to properly investigate the claim. This allegation, like the others, lacks the requisite specificity that would allow an appropriate response. The examples above reflect the complete lack of specificity in Complainant’s CRN and as such, the Department must reject the CRN. III. Applicability Security First received notice of the subject loss on 11/30/2023. Following this notice, Security First timely inspected the property through both a field adjuster and independent roofing company. Following its investigation, Security First timely issued a coverage decision to the named Insured. IV. Conclusion At all times, Security First has acted in good faith in its handling of the claim and it has acted fairly, honestly, and with due regard for the Insured’s interest and in determining obligations to Insured. Specifically, Security First has complied with its obligations under the applicable Florida Statutes and the applicable Security First Insurance policy. Security First specifically denies any claim for bad faith and argues that the insured’s claim for bad faith is premature. Security First continues to reserve all its rights under the policy, at law and in equity. Regardless, Insured’s conclusory allegations fail to place Security First on notice of any purported violations. Furthermore, the Civil Remedy Notice fails to identify how to cure the allegations set forth. The allegations are without basis. It is clear Security First properly handled and adequately investigated the claim. We hope that this response has answered any concerns regarding this matter. If the Department has any questions concerning this matter, please do not hesitate to contact the undersigned counsel. Sincerely, /s/ Alexandria Gordon Alexandria Gordon, Esq. Florida Bar No: 117736 Attorney for the Defendant Security First Insurance Company 1001 Broadway Avenue Ormond Beach, Florida 32714 Alexandria.gordon@securityfirstflorida.com Telephone Number: (386) 868-1117
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