Civil Remedy Notice of Insurer Violations
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Filing Number:     793943
Filing Accepted:  11/25/2024
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Complainant
Last/Business Name *  
LENNAR HOMES, LLC   First Name  
Street Address * 5505 WATERFORD DISTRICT DRIVE
City, State Zip * MIAMI, FL 33126
Email Address * LKERR@COGBURNLEGAL.COM
Complainant Type: * Insured
Insured
Last/Business Name*   S&T PAINTING ENTERPRISE INC.   First Name  
Policy # * BIFL11980201 Claim #* 17F86K512509
Attorney
Attorney is Applicable
Last Name* KERR First Name * LAUREN Initial D
Street Address* 777 S. HARBOUR ISLAND BLVD., SUITE 245
City, State Zip* TAMPA , FL 33602
Email Address * LKERR@COGBURNLEGAL.COM
Violation
Insurer Type *   Authorized Insurer Unauthorized Insurer
 
Insurer Name*   CLEAR BLUE INSURANCE COMPANY
NAIC Company Code 28860
 
Name of individual responsible for violation (if any):* LANDON SIMS
Type of Insurance * Commercial Property & Casualty   
Reason for Notice *
Claim Delay
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)(c) Failing to acknowledge and act promptly upon communications with respect to claims.
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.
* Specific policy language that is relevant to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

S&T Painting Enterprise Inc. (“S&T”) purchased at least one commercial general liability (“CGL”) policy from Clear Blue Insurance Company ("Clear Blue") providing ongoing and products-completed operations coverage for liability because of property damage resulting from S&T”s work, specifically Policy Number BIFL11980201 (the "Policy"). The insuring agreement of the Policy states: We will pay those sums that the insured becomes legally obligated to pay as damages because of … “property damage” to which this insurance applies. We will have the right and duty to defend the insured against any “suit” seeking those damages … The Policy defines “property damage” to include: a. Physical injury to tangible property, including all resulting loss of use of that property … or b. Loss of use of tangible property that is not physically injured … For coverage to be afforded, “property damage” must have been caused by an “occurrence,” which is defined under the Policy as “an accident, including continuous or repeated exposure to substantially the same general harmful conditions. In the event of continuing or progressively deteriorating damage over any length of time, such damage shall be deemed to be one occurrence, and shall be deemed to occur only when such damage first commences.” Not only does the Policy provide coverage to the named insured, S&T, it also provides coverage to Lennar Homes, LLC (“Lennar”) as an additional insured. The Policy contains the following endorsement in relevant part: ADDITIONAL INSURED – OWNERS, LESSEES OR CONTRACTORS – SCHEDULED PERSON OR ORGANIZATION This endorsement modifies insurance provided under the following: COMMERCIAL GENERAL LIABILITY COVERAGE PART A. Section II – Who Is An Insured is amended to include as an additional insured the person(s) or organization(s) shown in the Schedule . . . SCHEDULE All covered under FCG 1001 12 12 (FCG 1001 12 12 extends coverage when required by contract) The Policy also contains a similar endorsement extending the additional insured coverage to S&T’s Completed Operations. The subcontract between S&T and Lennar required that S&T name Lennar as an additional insured on its policies of insurance.
 
* 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 being filed because Clear Blue Insurance Company ("Clear Blue") has failed to address Lennar Homes, LLC’s (“Lennar”) tenders of defense in good faith. The Clear Blue policy implicated is Policy Number BIFL11980201 (the "Policy"). Lennar has been named as a defendant in a lawsuit styled as Bridgehaven at Citrus Park Homeowners Association, Inc. v. Lennar Homes, LLC, et al, Case No. 22-CA-009092, Hillsborough County, Florida (now pending before the American Arbitration Association) (the “Lawsuit”). The Lawsuit alleges property damage resulting from work performed at the Bridgehaven community (the “Project”), including the painting and sealant work performed by Lennar’s subcontractor, S&T Painting Enterprise Inc. (S&T”). During original construction, S&T performed work at the Project pursuant to the terms and conditions of its subcontract with Lennar. Included in the subcontract between Lennar and S&T was a requirement that S&T would secure commercial general liability ("CGL") insurance and name Lennar as an Additional Insured. S&T purchased at least one CGL policiy, the Policy, from Clear Blue, which provides ongoing and products-completed operations coverage for liability because of property damage resulting from S&T’s work. This coverage extends to both the named insured, S&T, and the additional insured, Lennar. As described supra, the Policy extends coverage to additional insureds where required by contract. Because the written subcontract between Lennar and S&T required S&T to name Lennar as an additional insured, Lennar is an additional insured under the Policy. Lennar tendered its defense to Clear Blue on December 22, 2022 and December 5, 2023. Although Clear Blue acknowledged receipt of the claim, for nearly two years, Clear Blue has refused to issue a coverage determination as to Lennar’s tenders of defense, nor has Clear Blue provided Lennar with a defense in the Lawsuit. Clear Blue’s refusal to provide a defense to Lennar is knowingly wrongful because the Lawsuit, as pled, implicates coverage under the Policy and does not clearly implicate any exclusions under the Policy. "Under Florida law, an insurer's duty to defend its insured against legal action is quite broad, and 'is determined by comparing the allegations contained within the four corners of the underlying complaint with the language of the policy.'" Zurich Am. Ins. Co. v. Southern- Owners Ins. Co., 314 F. Supp. 3d 1284, 1299 (M.D. Fla. 2018) (Howard, J.) citing Addison Ins. Co. v. 4000 Island Blvd. Condo. Ass'n, Inc., 263 F. Supp. 3d 1266, 1269 (S.D. Fla. 2016) (quoting Jones v. Fla. Ins. Guar. Ass'n Inc., 908 So. 2d 435, 443 (Fla. 2005)). That is, an insurer's duty to defend is determined solely by the allegations in the underlying complaint. Zurich, 314 F. Supp. 3d at 1299 citing Category 5 Mgmt. Grp., LLC v. Companion Prop. & Cas. Ins. Co., 76 So. 3d 20, 23 (Fla. 1st DCA 2011); Lawyers Title Ins. Corp. v. JDC (Am.) Corp., 52 F. 3d 1575, 1580 (11th Cir. 1995). "The duty arises when the relevant pleadings allege facts that 'fairly and potentially bring the suit within policy coverage.'" Id. citing Lawyers Title Ins. Corp., 52 F. 3d at 1580 (quoting Lime Tree Vill. Cmty. Club Ass'n, Inc. v. State Farm Gen. Ins. Co., 980 F. 2d 1402, 1405 (11th Cir. 1993)). The actual facts of the situation are not relevant, such that "the insurer must defend even if facts alleged are actually untrue or legal theories unsound." Id. As a result, "an insurer's duty to defend is distinct from, and broader than, the duty to indemnify," Id. citing Sinni v. Scottsdale Ins. Co., 676 F. Supp. 2d 1319, 1323 (M.D. Fla. 2009), which "must be determined by analyzing the policy coverage in light of the facts in the underlying case," J.B.D. Constr., Inc. v. Mid-Continent Cas. Co., 571 F. App'x 918, 927 (11th Cir. 2014) (emphasis added). In addition, where an injured party "alleges facts partially within and partially outside the coverage of the policy, the insurer is obligated to defend the entire suit." Category 5 Mgmt. Grp., LLC, 76 So. 3d at 23. Clear Blue’s failure to defend Lennar has prejudiced and damaged Lennar. Due to Clear Blue’s unreasonable claims handling practices, Lennar has been and will be forced to incur significant defense costs in the Lawsuit, for which Clear Blue is responsible. The Lawsuit includes allegations of losses covered under the Policy. Under Florida law, Clear Blue’s duty to defend Lennar was triggered by the Plaintiff’s allegations, whether they are proven to be true or not. Clear Blue appears to be employing a misguided strategy of simply ignoring the Lawsuit and Lennar’s tender of defense in an effort to avoid paying the defense costs to which Lennar is entitled. The attorneys' fees and costs that Lennar has incurred have unjustly burdened Lennar. Moreover, by refusing to defend Lennar, Clear Blue has greatly exposed its named insured, S&T, to a much larger claim for Lennar’s defense costs in this matter pursuant to the contractual indemnification provisions in the subcontract. Clear Blue must exercise its duty of good faith to Lennar and must employ “the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business.” Farinas v. Florida Farm Bureau Gen. Ins. Co., 850 So. 2d 555 (Fla. 4th DCA 2003) (internal citations omitted). Under Farinas, Clear Blue is obligated to (1) fully investigate all claims at hand to determine how to best limit its insured’s liability; (2) seek to settle as many claims as possible within the policy limits; (3) minimize the magnitude of possible excess judgments against its insureds by reasoned claim settlement; and (4) keep the insureds informed of the claim resolution process. Clear Blue’s obligations extend to all the insureds under the Policy and are not limited to the named insured. Thus, Clear Blue’s obligations extend to additional insureds, like Lennar. To date, Lennar is unaware of Clear Blue’s investigation, if any, of the claims against Lennar, or its efforts, if any, to seek to settle the claim within the policy limits. Likewise, Clear Blue has never advised Lennar how, or if, it intends to minimize the magnitude of a possible excess judgment against Lennar. Given Clear Blue’s lack of participation for over two years and the other facts outlined above, Clear Blue has failed or attempted to meet the standard for good faith in this matter. Lennar will be filing suit against Clear Blue but is also filing this notice in an effort to provide Clear Blue with a last opportunity to deal with Lennar in good faith as well as to perfect its right to pursue the remedies provided under Section 624.155, Florida Statutes. Clear Blue can cure by acknowledging its duty to defend Lennar, reimbursing Lennar for its reasonable defense costs, and working together with Lennar to resolve this claim, including without limitation participating at the mediation scheduled for December 10, 2024.
Comments
User Id Date Added Comment
kgillis@boydjen.com 04-09-2025 February 7, 2025 VIA ELECTRONIC FILING Florida Department of Financial Services Office of Insurance Regulation Civil Remedy Division 200 East Gaines Street Tallahassee, FL 32399-0326 Re: Complainant: Lennar Homes, LLC DFS Filing No.: 793943 Filing Accepted: 11/25/2024 Insured: S&T Painting Enterprise Inc. Claim No.: 17F86K512509 To Whom It May Concern: This is Clear Blue Insurance Company’s (“Clear Blue”) response to the Civil Remedy Notice of Insurer Violations (“CRN”) referenced above, following an agreed-upon extension of time to respond thereto by counsel for Complainant, Lennar Homes, LLC, counsel for Bridgehaven at Citrus Park Homeowners Association, Inc. (the “Association”), and counsel for Clear Blue. Counsel for Complainant has advised Clear Blue that the claims being made against Complainant by the Association and for which Complainant filed the CRN have been resolved and Complainant assigned its claims against the subcontractors, including Clear Blue’s named insured, S&T Painting Enterprise Inc. (“S&T Painting”), to the Association. It is, therefore, Clear Blue’s position that the CRN is moot. Subject to and without waiving its position that the CRN is moot, it is also Clear Blue’s position that the CRN is legally insufficient. As an initial matter, the CRN fails to allege facts and circumstances supporting each of the five statutory provisions allegedly violated by Clear Blue. For example, Complainant does not allege any facts to support its claim that Clear Blue violated section 626.9541(1)(i)(3)(c) for “[f]ailing to adopt and implement standards for the proper investigation of claims.” The CRN is also legally insufficient because it failed to give Clear Blue sixty days within which to cure the alleged defects. Specifically, the CRN, which was filed on November 25, 2024, states that Clear Blue could cure the alleged violations, in part, by participating in mediation scheduled for December 10, 2024—only fifteen days after it filed the CRN. Without waiving its position that the CRN is moot and legally insufficient, Clear Blue expressly denies all allegations that it has acted in bad faith, including all allegations in the CRN. As an initial matter, contrary to Complainant’s allegation that Clear Blue failed to issue a coverage determination with respect to Complainant’s tenders, Clear Blue, through its third-party administrator, denied Complainant’s tender for defense and indemnification via letter dated July 2, 2023, in which it detailed the reasons for the coverage denial and advised Complainant that it could provide additional information to Clear Blue for reconsideration. Clear Blue issued a commercial general liability policy to S&T Painting for the policy period from 06/05/2017 to 06/05/2018, and a renewal policy for the policy period from 06/05/218 until it terminated on 11/07/2018 (collectively referred to as the “Policy”). The Policy provides that Clear Blue “will pay those sums that the insured becomes legally obligated to pay as damages because of . . . ‘property damage’ to which this insurance applies. We will have the right and duty to defend the insured against any ‘suit’ seeking those damages.” Although the Policy contains an Additional Insured – Owners, Lessees or Contractors – Scheduled Person or Organization endorsement and an Additional Insured – Owners, Lessees or Contractors – Completed Operations endorsement, those endorsements only apply “if you [S&T Painting] and the person or organization have agreed in writing in a contract or agreement that such person or organization be added as an Additional Insured under your policy and only if such contract or agreement is executed by each party prior to the state of your work for such person or organization.” Despite requests for the same, Clear Blue has not been provided with any written contract or agreement between Complainant and S&T Painting in which S&T Painting agreed to add Complainant as an additional insured on its policy. Thus, Clear Blue’s obligation to defend Complainant as an additional insured on the Policy has not been triggered. Furthermore, the Additional Insured – Owners, Lessees or Contractors – Scheduled Person or Organization endorsement only provides coverage for property damage “caused, in whole or in part, by: 1. Your acts or omissions; or 2. The acts or omissions of those acting on your behalf; in the performance of your ongoing operations for the additional insured(s) . . . .” Similarly, the Additional Insured – Owners, Lessees or Contractors – Completed Operations endorsement only provides coverage for property damage “caused, in whole or in part, by, ‘your work’ at the location designated and described in the schedule of this endorsement performed for that additional insured and included in the ‘products-completed operations hazard’.” Even if Complainant qualified as an additional insured, the Policy does not provide additional insured coverage for Complainant’s own conduct. Finally, the Policy does not provide coverage for the costs of repairing or replacing Complainant’s or S&T Painting’s defective work, and it expressly precludes coverage for “‘property damage’ . . . which began prior to the inception date of this policy, and which is alleged to continue into this policy”; property damage to “that particular part of real property on which you or any contractors or subcontractors working directly or indirectly on your behalf are performing operations, if the ‘property damage’ arises out of those operations”; property damage to “that particular part of any property that must be restored, repaired or replaced because ‘your work’ was incorrectly performed on it”; and property damage “to ‘your work’ arising out of it or any part of it and included in the ’products completed operations hazard.’” Clear Blue will continue to review additional information submitted and will reevaluate its coverage position should any additional information be provided. If you require further information or have any questions, please feel free to contact us. Sincerely, Clear Blue Insurance Company cc: Lauren Kerr, Esq. Matthew Cogburn, Esq. Kelly Corcoran, Esq.
kgillis@boydjen.com 04-09-2025 The response to CRN filing number 793943 was inadvertently uploaded to CRN filing number 793493 on February 7, 2025. The CRN response for filing number 793943 was provided to counsel for Complaint and counsel for Bridgehaven at Citrus Park Homeowners Association, Inc. on the same date. The inadvertent clerical error has been brought to the attention of all counsel. The February 7, 2025 response is uploaded here as well.
karend@fwcrum.com 01-24-2025 VIA ELECTRONIC FILING Florida Department of Financial Services Office of Insurance Regulation Civil Remedy Division 200 East Gaines Street Tallahassee, FL 32399-0326 Re: Complainant: Lennar Homes, LLC DFS Filing No.: 793493 Filing Accepted: 11/25/2024 Insured: S&T Painting Enterprise Inc. Claim No.: 17F86K512509 To Whom It May Concern: This is Clear Blue Insurance Company’s (“Clear Blue”) initial response to the Civil Remedy Notice of Insurer Violations (“CRN”) referenced above. Complainant and Clear Blue have agreed to extend the deadline for responding the CRN for an additional two weeks. Clear Blue will respond to the CRN on or before February 7, 2025. By filing this initial response, Clear Blue does not waive any arguments relating to the sufficiency of the CRN or any other arguments in response thereto. If you require further information or have any questions, please feel free to contact us. Sincerely, /s/Karen Dunbar cc: Lauren Kerr, Esq.
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