Filing Number: 793815
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| Filing Accepted: 11/22/2024 |
| Last/Business Name
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SEYMOUR REALTY 1941 LLC
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First Name |
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| Street Address
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1941 N DIXIE HWY |
| City, State Zip
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POMPANO BEACH,
FL
33060
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| Email Address
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SERVICE@LRLC.LEGAL |
| Complainant Type:
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Insured |
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| Last/Business Name* |
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SEYMOUR REALTY 1941, LLC |
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First Name |
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| Policy # * |
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SEBP056853 |
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Claim #* |
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1.55958 |
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Attorney is Applicable
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| Last Name* |
STERN
First Name *
ALEX
Initial
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| Street Address* |
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16375 NE 18TH AVE., STE. 321 |
| City, State Zip* |
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NORTH MIAMI BEACH
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FLORIDA
33162
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| Email Address * |
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ALEX@LRLC.LEGAL |
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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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AMGUARD INSURANCE COMPANY
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| Insurer Name* |
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| Street Address* |
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| City, State Zip* |
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,
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NAIC Company Code 42390 |
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| Name of individual responsible for violation (if any):*
CAROL KOLASZ, ORLANDO MARTINOLI
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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 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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| 624.155(1)(b)(2) |
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Making claims payments to insureds or beneficiaries not accompanied by a statement setting forth the coverage under which payments are being made.
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| 624.155(1)(b)(3) |
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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.
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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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| 626.9541(1)(i)(3)(f) |
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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.
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| 626.9541(1)(i)(3)(g) |
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Failing to promptly notify the insured of any additional information necessary for the processing of a claim.
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| 626.9541(1)(i)(3)(h) |
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Failing to clearly explain the nature of the requested information and the reasons why such information is necessary.
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| 626.9541(1)(i)(3)(j) |
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Altering or amending an insurance adjuster’s report without:
(I) Providing a detailed explanation as to why any change that has the effect of reducing the estimate of the loss was made; and
(II) Including on the report or as an addendum to the report a detailed list of all changes made to the report and the identity of the person who ordered each change; or
(III) Retaining all versions of the report, and including within each such version, for each change made within such version of the report, the identity of each person who made or ordered such change;
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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.
SECTION I – PROPERTY
A. Coverage
We will pay for direct physical loss of or damage to
Covered Property at the premises described in the
Declarations caused by or resulting from any Covered
Cause of Loss.
1. Covered Property
Covered Property includes Buildings as described
under Paragraph a. below, Business Personal
Property as described under Paragraph b. below,
or both, depending on whether a Limit of Insurance
is shown in the Declarations for that type of property.
Regardless of whether coverage is shown in the
Declarations for Buildings, Business Personal
Property, or both, there is no coverage for property
described under Paragraph 2. Property Not Covered.
a. Buildings, meaning the buildings and structures
at the premises described in the Declarations,
including:
(1) Completed additions;
(2) Fixtures, including outdoor fixtures;
(3) Permanently installed:
(a) Machinery; and
(b) Equipment
...
5. Additional Coverages
a. Debris Removal
(1) Subject to Paragraphs (3) and (4), we will
pay your expense to remove debris of Covered
Property caused by or resulting from a
Covered Cause of Loss that occurs during
the policy period.
...
f. Business Income
(1) Business Income
(a) We will pay for the actual loss of Business
Income you sustain due to the necessary
suspension of your "operations"
during the "period of restoration".
...
g. Extra Expense
(1) We will pay necessary Extra Expense you
incur during the "period of restoration" that
you would not have incurred if there had
been no direct physical loss or damage to
property at the described premises.
...
l. Increased Cost Of Construction
(1) This Additional Coverage applies only to
buildings insured on a replacement cost basis.
(2) In the event of damage by a Covered Cause
of Loss to a building that is Covered Property,
we will pay the increased costs incurred
to comply with enforcement of an ordinance
or law in the course of repair, rebuilding or
replacement of damaged parts of that property,
subject to the limitations stated in Paragraphs
(3) through (9) of this Additional
Coverage.
(3) The ordinance or law referred to in Paragraph
(2) of this Additional Coverage is an
ordinance or law that regulates the construction
or repair of buildings or establishes zoning
or land use requirements at the described
premises, and is in force at the time
of loss.
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r. Limited Coverage For "Fungi", Wet Rot, Dry
Rot And Bacteria
(1) The coverage described in Paragraphs r.(2)
and r.(6) only applies when the "fungi", wet
or dry rot or bacteria are the result of a
"specified cause of loss" other than fire or
lightning that occurs during the policy period
and only if all reasonable means were used
to save and preserve the property from further
damage at the time of and after that occurrence.
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E. Property Loss Conditions
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2. Appraisal
If we and you disagree on the amount of loss, either
may make written demand for an appraisal of
the loss. In this event, each party will select a competent
and impartial appraiser. The two appraisers
will select an umpire. If they cannot agree, either
may request that selection be made by a judge of a
court having jurisdiction. The appraisers will state
separately the amount of loss. If they fail to agree,
they will submit their differences to the umpire. A
decision agreed to by any two will be binding. Each
party will:
a. Pay its chosen appraiser; and
b. Bear the other expenses of the appraisal and
umpire equally.
If there is an appraisal, we will still retain our right to
deny the claim.
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5. Loss Payment
In the event of loss or damage covered by this policy:
a. At our option, we will either:
(1) Pay the value of lost or damaged property;
(2) Pay the cost of repairing or replacing the lost
or damaged property;
(3) Take all or any part of the property at an
agreed or appraised value; or
(4) Repair, rebuild or replace the property with
other property of like kind and quality, subject
to Paragraph d.(1)(e) below.
b. We will give notice of our intentions within 30
days after we receive the sworn proof of loss.
c. We will not pay you more than your financial
interest in the Covered Property.
d. Except as provided in Paragraphs (2) through
(7) below, we will determine the value of Covered
Property as follows:
(1) At replacement cost without deduction for
depreciation, subject to the following:
(a) If, at the time of loss, the Limit of Insurance
on the lost or damaged property is
80% or more of the full replacement cost
of the property immediately before the
loss, we will pay the cost to repair or replace,
after application of the deductible
and without deduction for depreciation,
but not more than the least of the following
amounts:
(i) The Limit of Insurance under Section
I – Property that applies to the lost or
damaged property;
(ii) The cost to replace, on the same
premises, the lost or damaged property
with other property:
i. Of comparable material and quality;
and
ii. Used for the same purpose; or
(iii) The amount that you actually spend
that is necessary to repair or replace
the lost or damaged property.
If a building is rebuilt at a new premises,
the cost is limited to the cost which would
have been incurred had the building been
built at the original premises.
(b) If, at the time of loss, the Limit of Insurance
applicable to the lost or damaged
property is less than 80% of the full replacement
cost of the property immediately
before the loss, we will pay the
greater of the following amounts, but not
more than the Limit of Insurance that applies
to the property:
(i) The actual cash value of the lost or
damaged property; or
(ii) A proportion of the cost to repair or
replace the lost or damaged property,
after application of the deductible and
without deduction for depreciation.
This proportion will equal the ratio of
the applicable Limit of Insurance to
80% of the cost of repair or replacement.
(c) You may make a claim for loss or damage
covered by this insurance on an actual
cash value basis instead of on a replacement
cost basis. In the event you
elect to have loss or damage settled on
an actual cash value basis, you may still
make a claim on a replacement cost basis
if you notify us of your intent to do so
within 180 days after the loss or damage.
(d) We will not pay on a replacement cost
basis for any loss or damage:
(i) Until the lost or damaged property is
actually repaired or replaced; and
(ii) Unless the repairs or replacement are
made as soon as reasonably possible
after the loss or damage.
However, if the cost to repair or replace
the damaged building property is $2,500
or less, we will settle the loss according
to the provisions of Paragraphs d.(1)(a)
and d.(1)(b) above whether or not the actual
repair or replacement is complete.
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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.
This Civil Remedy Notice is filed against AmGUARD Insurance Company (“Carrier”) for violations of Florida law, including Fla. Stat. § 624.155 and Fla. Stat. § 626.9541, resulting from the Carrier’s improper handling of the insured’s loss, and ultimate underpayment of the claim. The Carrier’s actions demonstrate a lack of good faith, fair dealing, and due regard for the interests of its policyholder, causing unnecessary litigation, additional damages, and financial harm to the insured. Carrier issued insurance policy number SEBP056853 (the “Policy”) to Seymour Realty 1941 LLC (“Policyholder”). The Policy provides insurance coverage Policyholder’s property located at 1941 N Dixie Hwy, Pompano Beach, FL 33060-5048 (the “Property”). The Policy is an “all-risks” policy, meaning that all damages are covered unless specifically excluded by the Policy.
The insured’s property sustained significant damage due to a car crashing into the Property during the Policy’s period. The insured reported the loss, complied with all post-loss conditions, and allowed the Carrier to inspect the Property multiple times. Following its inspection, the Carrier admitted coverage for the loss, finding covered damage to Property. However, the Carrier’s evaluation grossly undervalued the loss, resulting in an initial payment of well below the amount necessary to restore the property to its pre-loss condition. The Carrier’s estimate failed to include critical components of the repair costs. These omissions rendered the Carrier’s initial payment wholly inadequate and contrary to industry standards and the policy’s terms. Moreover, Carrier’s claim payment was not accompanied with a statement adequately setting forth the coverage under which payments are being made or the reason for the compromise lowball settlement. If Carrier had adopted and implemented standards for the proper investigation of claims, Carrier would not have made the lowball, inadequate payment and coverage determination. Carrier’s payment misrepresented the pertinent facts or insurance policy provisions relating to coverages at issue by representing that Carrier’s lowball estimate was the full extent of coverage available under the Policy.
Recognizing the inadequacy of the Carrier’s lowball estimate, the insured invoked their right to appraisal under the policy to resolve the dispute regarding the amount of loss. Despite this valid demand, the Carrier failed to respond to the appraisal request, delaying the resolution of the claim. The Carrier’s failure to respond or engage in appraisal forced the insured to file a lawsuit. Even after the lawsuit was filed, the Carrier opposed the lawsuit and failed to make any additional payment, further delaying resolution.
Ultimately, a jury determined that Carrier undervalued the loss and that Carrier owed Policyholder an additional $30,000, a figure nearly double the Carrier’s initial valuation proving Carrier failed to properly investigate and evaluate the loss. Had the Carrier properly investigated the loss, adequately evaluated the damage, and acted in good faith when the appraisal demand was made, this dispute could have been resolved without the need for litigation. Instead, the Carrier’s failure to respond to the appraisal demand and its subsequent delays caused the insured to incur unnecessary attorney’s fees, costs, and additional damages including liens and costs imposed by the government based on the Property’s condition, inability to sell the Property, lost rents, and additional repair costs made in attempt to mitigate Policyholder’s damages. These are recoverable as part of the insured’s bad faith damages.
Carrier failed to respond to the insured’s valid appraisal demand for an unreasonable amount of time, delaying resolution of the claim and forcing the insured into litigation. This violates Fla. Stat. § 626.9541(1)(i)(3)(c), which requires insurers to acknowledge and act promptly upon communications regarding claims. Moreover, Carrier failed to settle the insured’s claim in good faith despite its liability being reasonably clear, as evidenced by the significant discrepancy between the initial payment and the jury’s verdict. This is a violation of Fla. Stat. § 624.155(1)(b)(1). Furthermore, Carrier failed to conduct a reasonable and thorough investigation of the insured’s claim, resulting in a grossly inadequate estimate that omitted critical repair costs. This violates Fla. Stat. § 626.9541(1)(i)(3)(a), which requires insurers to adopt and implement proper standards for claim investigations. Carrier also failed to pay the full amount owed under the Policy in violation of Fla. Stat. § 626.9541(1)(i)(4), which prohibits insurers from failing to pay undisputed amounts of partial or full benefits owed under the policy. Carrier’s unreasonable opposition the insured’s efforts to seek appraisal, despite the policy clearly providing for appraisal as the mechanism to resolve disputes over the amount of loss. This demonstrates bad faith conduct designed to delay resolution and underpay the claim.
Carrier must pay all monies owed under the Policy and any additional damages resulting from the Carrier’s unreasonable delay in handling the claim and resulting litigation. Carrier must also reimburse the insured for all attorney’s fees and costs incurred as a result of the Carrier’s failure to properly investigate the claim, undervaluation of the loss, and failure to respond to the appraisal demand. Further, Carrier must adopt and implement procedures to ensure timely responses to appraisal demands and compliance with the policy’s appraisal provisions in the future; and conduct a thorough review of its claims handling practices to ensure compliance with Florida law and industry standards, particularly regarding proper investigation, evaluation, and timely payment of claims.
Carrier failed to abide by the duties owed its Policyholder, committed unfair insurance trade practices, and violated Florida Statute Section 624.155 by, for example, not making good faith efforts to settle the claim when under the circumstances Carrier could and should have done so had it acted fairly and honestly toward its insured and with due regard for Policyholder’s interests because; by making claims payments to insureds or beneficiaries not accompanied by a statement setting forth the coverage under which payments are being made; by 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; by making a material misrepresentation to Policyholder for the purpose and with the intent of effecting settlement of such claims, loss, or damage under such contract or policy on less favorable terms than those provided in, and contemplated by, such contract or policy; and by failing to pay undisputed amounts of partial or full benefits owed under this first-party property insurance Policy within 90 days after an Carrier received notice of the Claim, properly determined the amounts of partial or full benefits, and agreed to coverage because Carrier failed to pay the full amounts due and owing under the Policy within 90 days of the Claim being reported. Moreover, Carrier fails to abide by the duties owed its policyholders, commits unfair insurance trade practices, and violates Florida Statute Section 624.155 with such frequency as to indicate a general business practice by, for example, failing to adopt and implement standards for the proper investigation of claims because in multiple instances including this Claim Carrier failed to conduct a thorough and proper investigation by failing to conduct an investigation designed to discover facts beneficial to Policyholder; misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue by not providing policyholders fair and adequate explanation of the coverages available, not explaining to policyholders the benefits available under an all-risks policy; failing to acknowledge and act promptly upon communications with respect to claims by not responding to policyholders’ submission of documents and requests for information; denying claims without conducting reasonable investigations based upon available information; 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; 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; failing to promptly notify the insured of any additional information necessary for the processing of a claim; or failing to clearly explain the nature of the requested information and the reasons why such information is necessary.
To remedy the violations described herein, Carrier must unconditionally tender all amounts under the Policy inclusive of interest, all attorney fees and costs incurred by Policyholder, and for the additional damages incurred by Policyholder including any liens, fines, lost rents, or amounts incurred by Policyholder attempting to mitigate its damages arising form Carrier’s mishandling of the Claim.
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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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