Filing Number: 795474
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| Filing Accepted: 12/5/2024 |
| Last/Business Name
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| Street Address
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1349 W 28TH ST |
| City, State Zip
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RIVIERA BEACH,
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33404
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| Email Address
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BELINDACSMITH82@GMAIL.COM |
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Insured |
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| Last/Business Name* |
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ADAMS |
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First Name |
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JAMES |
| Policy # * |
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161001012 |
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Claim #* |
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0769436924 |
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Attorney is Applicable
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| Last Name* |
ZANAKOS
First Name *
CHRISTINA
Initial
N
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| Street Address* |
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20283 FL 7 SUITE 422 |
| City, State Zip* |
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BOCA RATON
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FL
33498
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| Email Address * |
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CHRISTINA@ELITELEGALPA.COM |
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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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CASTLE KEY 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 30511 |
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| Name of individual responsible for violation (if any):*
PIERRE DE LEON ON BEHALF OF CASTLE KEY, GUSTAVO ARZUAGA ON BEHALF OF CASTLE KEY, AND ALL OTHER ADJUSTERS, ENGINEERS, SUPERVISORS, MANAGERS, AND INDIVIDUALS ASSOCIATED WITH THE HANDLING OF THEIR CLAIM.
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| Type of Insurance
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Residential Property & Casualty
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| Reason for Notice
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Claim Denial
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Unfair Trade Practice
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Other
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Disregarding Covered peril damage
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Other
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Placing Unreasonable Requirements on the Insured to Properly Adjust the Claim
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Other
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Failure to Respond to the Insured in a Timely Manner
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Other
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Wrongful denial of a covered AC loss
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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)(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)(2) |
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A material misrepresentation made to an insured or any other person having an interest in the proceeds payable under such contract or policy, 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.
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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)(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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Specific policy language that is relevant to the violation.
Enter all words or phrases (one at a time) that should be used to filter.
In addition to the above statutory provisions that have been violated, the following provisions of the Florida Administrative Code regarding ethical requirements for adjusters have also been violated:?
69B-220.201(3)(B) – An adjuster shall treat all claims equally.
69B-220.201(3)(C) – An adjuster shall not approach investigations, adjustments, and settlements in a manner prejudicial to the insured.
69B-220.201(3)(E) – An adjuster shall handle every adjustment and settlement with honesty and integrity, and allow a fair adjustment or settlement to all parties.
69B-220.201(3)(F) – An adjuster, upon undertaking the handling of a claim, shall act with dispatch and due diligence in achieving a proper disposition of the claim
Despite request, including in writing from the Public Adjuster on 9/19/24, Castle Key has failed and refused to provide a certified copy of the Insured’s insurance policy. The Insured is not required to provide policy language when the carrier refuses to provide the certified policy. Notwithstanding, to the best of the Insured’s information and belief, the following policy provisions were violated by CASTLE KEY in the improper handling of the claim, pursuant to Policy Number 161001012:
COVERAGE A – DWELLING
1. We cover:
a. the dwelling on the “residence premises” shown in the Declarations, including structures attached to the dwelling;
SECTION I – PERILS INSURED AGAINST
COVERAGE A – DWELLING AND COVERAGE B – OTHER STRUCTURES
1. We insure against direct physical loss to property described in Coverages A and B
F. Additional coverages
2. Reasonable Emergency Measures
SECTION I – CONDITIONS
3. Loss Settlement
10. Loss Payment
Including all definition sections, coverage sections, and loss payment provision sections of the Policy.
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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 notice is given in order to perfect the right to pursue the civil remedy authorized by section 624.155, Florida Statutes. In Florida, the work of adjusting insurance claims engages the public trust. The insurance company has breached this duty in the adjustment of the Insured’s claim of loss. Insurance company has failed to create and implement adequate guidelines for proper investigation of claims handling and for training and supervision of employees resulting in statutory violations (as set forth above). Further, insurance company has failed and/or refused to thoroughly, accurately, and completely investigate, evaluate, and pay the Insured’s insurance claim for damages. Insurance company has also ignored important information that would benefit the Insured, as described in further detail below. Though the Insured sustained a loss that, pursuant to the terms of the policy, should be covered by CASTLE KEY, the carrier has failed to tender all monies due and owing to the Insured for the damage caused to the insured property. The entire concept of insurance promises the Insured timely and prompt indemnity in exchange for the Insured’s premium payments to the Insurance company.?
Florida Statute section 624.02 defines insurance as a contract whereby one undertakes to indemnify another or pay or allow a specified amount or a determinable benefit upon determinable contingencies. Inherent is the fact that the insurance company must issue payment for a covered loss in a timely manner so that the Insureds may mitigate their damages and put them back in the position they were in prior to the loss as quickly as possible. Insurance company has breached this duty by refusing and failing to tender all insurance proceeds due and owing to the Insured upon her proper and timely submission of a claim. Insurance company charged the Insured a premium for coverage under the policy of insurance but refused and/or failed to fulfill its obligations per the Policy, when under all circumstances it could and should have done so had it acted fairly and honestly towards the Insured.
Furthermore, the Insured believes Insurance Company repeatedly and as a standard business practice engages in this behavior to deprive its Insureds of their rightful insurance proceeds when they experience a covered loss. Insured contends other Insureds have been refused insurance proceeds due and owing under the policy in the same or similar circumstances, and have been provided inadequate insurance monies under the same or similar facts or circumstances. The Insured further contends that Insurance company commits this standard business practice only to keep the claims adjustment process open and pending so that it does not have to pay fully on the claim. This is wrongful conduct and directly violates the purpose of insurance coverage. Insurance company’s wrongful conduct and omissions include, but are not limited to: claim delay, not conducting a full and prompt investigation, not treating the policyholder with good faith claims conduct, looking for ways to deny recovery to Insured; not responding to the Insured or her representatives; failing and refusing to review documents sent by the Insured; looking for ways to delay full recovery to Insured; wrongfully denying the claim; holding back and failing to pay portions of claim clearly owed; not adjusting the claim and evaluating the loss properly, promptly and fairly to provide full and prompt indemnity to the Insured; not training, supervising or managing adjusters properly so that prompt and full payments are made, but rather placing the company’s interests before the policyholder’s interests; establishing severity control initiatives and otherwise establishing a culture of not fully and promptly paying claims following losses; and failing to pay the full amount of the Insured’s damage despite knowing it must do so.
In Florida, the work of adjusting insurance claims engages the public trust. CASTLE KEY has breached this trust by its adjustment of the Insured’s claim of loss by refusing to properly indemnify the Insured for her air conditioning leak loss per the terms of the Policy and Florida Statutes.
On or about August 19, 2024, the Belinda Smith (the Insured) suffered damage to the interior of her Property, located at 1349 W 28th St, Riviera Beach, FL 33404, caused by a sudden and accidental air conditioning leak. The Insured noticed the carpet in her home was suddenly wet and damaged. The carpets at the property were recently installed by Empire in 2022, so the Insured contacted Empire to see if the carpets were still under warranty. The Insured also immediately contacted Progressive J’s Air Conditioning and Refrigeration, LLC, who came to the Property to investigate the cause of the water damage. At the time of the loss, the Property was insured by Castle Key under an all-risk policy, which includes coverage for direct, physical damages caused by a sudden and accidental air conditioning leak. The Insured promptly reported the loss to the carrier, per her Policy. The Insured is also the trustee for the Trust of James E Adams, her father who has since passed away, as well as an insured.
Progressive J’s Air Conditioning company came to the Property on August 21, 2024, two days after the loss was suffered, and advised the homeowner the air conditioning unit was leaking. Progressive J’s installed a new air conditioning unit the same day and the Insured has had no further problems since installation. This invoice for $5,000 for the leak detection, installation and other air conditioning work has been provided to Castle Key.
The Insured also retained Tropical Loss Consultants, a licensed and insured public adjusting company, to assist her with the loss. Tropical Loss Consultants prepared an XACTIMATE estimate for the total damages to the Property totaling $65,126.30, which accurately reflects the damages suffered at the Property as the result of the air conditioning leak. The PA also provided extensive photographs of the damages to the Property, including several photos of moisture meter readings showing excessive water levels in the walls surrounding the air conditioning closet and on the damaged carpet.
Castle Key assigned an adjuster to inspect the property, who did not conduct a thorough inspection. No moisture meter or any other tools were used to identify the cause of the water loss or note the saturation levels of the walls or carpeting. However, following the inspection, on September 25, 2024, at 2:30 pm, the public adjuster spoke with Gustavo Arzuaga, who verbally denied the claim on behalf of Castle Key. Gustavo advised the Insured during the inspection “he used to work at a water mitigation company and knew exactly what needed to be done to bring the homeowner back to pre-loss condition.” Additionally, the adjuster on behalf of Castle Key mentioned the walls were plaster, not dry wall, and that he would add the correct line items to his estimate. Despite the representations made by Castle Key’s adjuster during the inspection and adjustment of the claim to the public adjuster and the homeowner, a denial was received stating the damages were somehow pre-existing, even though Castle Key did not inspect the Property prior to the loss to determine if this was true. No recorded statement was ever requested by Castle Key or obtained to determine the timeline of events or confirm if any damages were pre-existing before the date of loss. It is blatant Castle Key failed and refused to perform a thorough inspection and denied the claim in an effort to avoid paying the homeowner for her covered loss, pursuant to the policy and Florida Statutes.
Despite inspection and receipt of extensive documentation provided by the Insured’s public adjuster, Castle Key has continued to fail and refuse to properly tender insurance proceeds to the Insured for her covered loss. Castle Key also failed and refused to investigate the loss thoroughly and determined coverage was denied based on allegations that were never confirmed.
Pursuant to Florida Statute §624.155(1)(b)(1), the Insurer, CASTLE KEY, has a duty to attempt, 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 the Insured and with due regard for her interests. CASTLE KEY has breached these duties in the handling of the Claim for financial gain and profit. CASTLE KEY did so when it refused to properly adjust the claim, purposefully delayed the claim process, and ignored information from the Insured that would assist the Insured in resolving her claim. Consequently, CASTLE KEY has violated Florida Statute §624.155(1)(b)(1). It would seem that CASTLE KEY is indifferent to the needs of its loyal customers, whose insurance premiums it did not hesitate to collect. CASTLE KEY had the duty to investigate and settle the Insured’s Claim in an honest manner and according to the coverage provided under the Policy. To be clear, CASTLE KEY and its representatives had a duty to investigate the Claim and pay the Insured the benefits she would be entitled to for the repairs under the terms and conditions outlined in the Policy and under Florida law. It has not done so to date, despite the Insured and her representatives making every effort to resolve the claim in the meantime. What CASTLE KEY did was wrongfully and intentionally deny the Claim without conducting a reasonable investigation with qualified and competent adjusters and experts, despite the fact that the evidence clearly shows the property was damaged by a covered cause of loss, resulting in significant damage. This unfair and unsupported underpayment of the Claim is evidence that CASTLE KEY has mishandled the Claim and its conduct is nothing less than common bad faith claims handling practices.
Pursuant to Florida Statute §626.9541(1)(i)(3)(a), CASTLE KEY had a duty to adopt and implement standards for the proper investigation and settlement of claims. It is clear from the facts in this case that CASTLE KEY was ill equipped to handle the Claim. The representatives sent to the Property by CASTLE KEY failed to correctly attribute the cause of loss and proper scope of damages resulting from the air conditioning leak, despite its rushed inspection of the Property and the extent of documentation sent from the Insured’s representatives evidencing the damages.
To date, the Insured still has not been properly compensated for her loss. The Insured is at a loss of how to proceed, as CASTLE KEY has failed and refused to properly assist the Insured with her covered loss despite its ethical, contractual, and statutory obligation to do so. Castle Key has refused to review the documents sent by the Insured’s public adjuster, as evidenced by Castle Key’s denial based on allegations never confirmed or even requested of the homeowner.
There may be further wrongful conduct which has not yet been made known to the Insured at this time. For example, certain conduct or actions cannot be verified without a complete review of CASTLE KEY’s claim file and claim guidelines. The Insured therefore retains the right to address additional concerns as they become known.?
CASTLE KEY improperly shifted the burden of proving the loss onto the Insured before adequately tendering insurance proceeds (which CASTLE KEY still has not done). This completely defeats the purpose of insurance, as the insurance company should adequately compensate its Insured for covered losses properly at the outset of a claim, not after months of being chased by and sent multiple pages of documentation by the Insured and her representatives, fighting to have her covered loss properly compensated.
Pursuant to Florida Statutes, Section 624.155, punitive damages may be awarded against an insurance company if the acts giving rise to the violation occur with such frequency as to indicate a general business practice and these acts are:?
(a) willful, wanton, and malicious;?
(b) in reckless disregard for the rights of any insured; or?
(c) in reckless disregard for the rights of a beneficiary under a life insurance contract.?
It is the Insured’s position that Insurance Company engages in the practice of wrongfully denying or underpaying insurance claims as a general business practice in a willful effort to increase profits and in reckless disregards for the Insured’s rights. This is wrongful conduct. This can be determined from a brief review of DFS’ Civil Remedy Notice website and the extensive filings against Castle Key for similar conduct, as well as a brief search of the Florida Court dockets which show the same behavior resulting in unnecessary litigation, which would not have occurred but for Castle Key’s mishandling of covered property losses in an effort to save itself money and deny or undervalue payment to its Insureds.
Notwithstanding the above, to cure the defects outlined in this Civil Remedy Notice, CASTLE KEY must do the following:?
(1) CASTLE KEY must act promptly, fairly and honestly towards the Insureds and with due regard for their interests in attempting to resolve the Insureds’ claim;
(2) CASTLE KEY must timely tender all insurance proceeds due and owing the Insured for the fair value of her claim which is fairly owed under the insurance policy that would reasonably place the Insured back to pre-loss condition, which is the full amount of the Insured’s estimate previously provided in the amount of $64,126.30, after the application of the applicable deductible of $1,000;
(3) CASTLE KEY must agree to reimburse the Insured for the unnecessary expenses incurred by having to retain legal counsel and her own experts to present her claim, which will be provided upon request to counsel based on the fees and costs accrued at the time of the request;
(4) CASTLE KEY must timely tender statutory pre-judgment interest pursuant to Florida Statute Section 627.70131 and/or Section 55.03.
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.
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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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