Filing Number: 800376
|
| Filing Accepted: 1/10/2025 |
| Last/Business Name
*
|
|
|
CYPRESS COURT, LLC
|
|
First Name |
|
|
|
| Street Address
*
|
|
3604 SEMINOLE AVENUE |
| City, State Zip
*
|
|
FORT MYERS,
FL
33916
|
| Email Address
*
|
|
FRANK@CEDANOCRE.COM |
| Complainant Type:
*
|
|
Insured |
|
| Last/Business Name* |
|
CYPRESS COURT, LLC |
|
First Name |
|
KIMBERLY |
| Policy # * |
|
FSF16710143 001 |
|
Claim #* |
|
KY22K2914890 |
|
Attorney is Applicable
|
| Last Name* |
DELGADO
First Name *
JAVIER
Initial
|
| Street Address* |
|
777 S. HARBOUR ISLAND BLVD, SUITE 950 |
| City, State Zip* |
|
TAMPA
,
FLORIDA
33602
|
| Email Address * |
|
JDTEAM@MERLINLAWGROUP.COM |
|
|
| Insurer Type
*
|
|
Authorized Insurer
Unauthorized Insurer
|
|
|
| Insurer Name |
|
|
| Insurer Name* |
|
WESTCHESTER SURPLUS LINES INSURANCE COMPANY
|
| Insurer Name* |
|
|
| Street Address* |
|
|
| City, State Zip* |
|
,
|
|
NAIC Company Code 10172 |
|
|
| Name of individual responsible for violation (if any):*
NICHOLAS TAMBURELLO (PROPERTY CLAIM ANALYST), ZACH WASHAM WITH EASTERN CLAIM SERVICE CENTER (NATIONAL GENERAL ADJUSTER), DWIGHT C. ENNIS (GENERAL ADJUSTER), EASTERN CLAIM SERVICE CENTER (THIRD PARTY ADMINISTRATOR), CRAWFORD GLOBAL TECHNICAL SERVICES
|
| Type of Insurance
*
Commercial Property & Casualty
|
|
|
| Reason for Notice
*
|
|
Claim Delay
|
|
Unsatisfactory Settlement Offer
|
|
Other
:
Failure to Properly Investigate Claim with Due Regard to Insured’s Interest
|
|
|
*
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)(d) |
|
Denying claims without conducting reasonable investigations based upon available information.
|
|
*
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 Statutory violations set forth above, the specific policy language that is relevant to the violations includes, but is not limited to, the following:
DECLARATIONS PAGE
Loc. No. Address Bld. No. Limit of Insurance
1 3604 Seminole Avenue, Fort Myers, FL 33916 1 $835,000
1 3604 Seminole Avenue, Fort Myers, FL 33916 2 $830,000
1 3604 Seminole Avenue, Fort Myers, FL 33916 3 $835,000
COMMERCIAL PROPERTY CP 00 10 10 12
BUILDING AND PERSONAL PROPERTY COVERAGE FORM
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, as used in this Coverage Part, means the type of property described in this section, A.1., and limited in A.2. Property Not Covered, if a Limit Of Insurance is shown in the Declarations for that type of property.
a. Building, meaning the building or structure described in the Declarations, including:
(1) Completed additions;
(2) Fixtures, including outdoor fixtures;
(3) Permanently installed:
(a) Machinery; and
(b) Equipment;
(4) Personal property owned by you that is used to maintain or service the building or structure or its premises, including:
(a) Fire-extinguishing equipment;
(b) Outdoor furniture;
(c) Floor coverings; and
(d) Appliances used for refrigerating, ventilating, cooking, dishwashing or laundering;
(5) If not covered by other insurance:
(a) Additions under construction, alterations and repairs to the building or structure;
(b) Materials, equipment, supplies and temporary structures, on or within 100 feet of the described premises, used for making additions, alterations or repairs to the building or structure.
4. Additional Coverages
e. Increased Cost Of Construction
(1) This Additional Coverage applies only to buildings to which the Replacement Cost
Optional Coverage applies.
(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 the minimum standards
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 e.(3) through e.(9) of this Additional
Coverage.
(3) The ordinance or law referred to in e.(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.
***
E. Loss Conditions
4. Loss Payment
a. In the event of loss or damage covered by this Coverage Form, 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, subject to b. below;
(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 b. below.
We will determine the value of lost or damaged property, or the cost of its repair or
replacement, in accordance with the applicable terms of the Valuation Condition in this
Coverage Form or any applicable provision which amends or supersedes the Valuation
Condition.
b. The cost to repair, rebuild or replace does not include the increased cost attributable
to enforcement of or compliance with any ordinance or law regulating the
construction, use or repair of any property.
7. Valuation
We will determine the value of Covered Property in the event of loss or damage as follows:
a. At actual cash value as of the time of loss or damage, except as provided in b., c., d. and
e. below.
CP 10 30 10 12
CAUSES OF LOSS - SPECIAL FORM
A. Covered Causes Of Loss
When Special is shown in the Declarations, Covered Causes of Loss means direct physical loss unless the loss is excluded or limited in this policy.
***
C. Limitations
The following limitations apply to all policy forms and endorsements, unless otherwise stated:
1. We will not pay for loss of or damage to property, as described and limited in this section. In addition, we will not pay for any loss that is a consequence of loss or damage as described and limited in this section.
c. The interior of any building or structure, or to personal property in the building or
structure, caused by or resulting from rain, snow, sleet, ice, sand or dust, whether driven
by wind or not, unless:
(1) The building or structure first sustains damage by a Covered Cause of Loss to its roof
or walls through which the rain, snow, sleet, ice, sand or dust enters;
COMMERCIAL PROPERTY CP 01 25 02 12
FLORIDA CHANGES
D. The Loss Payment Condition dealing with the number of days within which we must
pay for covered loss or damage is replaced by the following:
(3) Within 90 days of receiving notice of an initial, reopened or supplemental claim,
unless we deny the claim during that time or factors beyond our control reasonably
prevent such payment. If a portion of the claim is denied, then the 90-day time period for
payment of claim relates to the portion of the claim that is not denied.
Paragraph (3) applies only to the following:
(a) A claim under a policy covering residential property;
|
| |
*
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 made on behalf of Cypress Court, LLC (“CYPRESS COURT”). In consideration of premiums, Westchester Surplus Lines Insurance Company (“WESTCHESTER OR CHUBB”) issued a commercial residential policy, bearing policy number FSF16710143 001 with an effective policy period of July 26, 2022, to July 26, 2023 (the “Policy”), to CYPRESS COURT. Coverage is written on CP 00 10 10/12 BUILDING AND PERSONAL PROPERTY COVERAGE FORM and CP 09/17 CAUSES OF LOSS –SPECIAL FORM, which provides coverage as follows:
Loc. No. Bld. No. Limit of Insurance
1 1 $835,000
1 2 $830,000
1 3 $835,000
These coverages are subject to a 5% windstorm or hail deductible. The Policy has an Actual Cash Value Roof limitation and further provides coverage for Ordinance or Law.
The subject Policy is an all-risk policy, which means that it covers all direct physical loss to the Property unless otherwise excluded. Under an all-risk policy, once the covered Property suffers a loss and it is reported to the insurance company, the responsibility to determine the cause(s) of loss and the amount of damage falls to the insurer. If an exclusion in the Policy applies, it is up to the insurer to investigate and determine what specific damage is excluded from coverage and the balance of the claim should be paid timely.
CYPRESS COURT’s property consists of three (3) two-story multi-family residential buildings and one (1), one-story amenity structure located at 3604-3608 Seminole Avenue, Fort Myers, Lee County, Florida 33916 (the “Property”).
On September 28, 2022, while the Policy was in full force and effect, the Property was damaged because of Hurricane Ian, a Category 4 hurricane that made landfall in Lee County. The high wind associated with Hurricane Ian caused direct physical damage to the Property, including, but not limited to, damage to the roofing and fenestration systems, and buildings’ interior and exterior elements.
On October 3, 2022, CYPRESS COURT timely reported the damage to WESTCHESTER. WESTCHESTER acknowledged the claim and assigned claim number KY22K2914890 to the loss. Upon receipt of the claim, WESTCHESTER obtained the services of Mr. Bret Samboy and Mr. Mark Negri, of the independent adjusting firm Crawford & Company, to assist in the investigation of the claim.
On October 17, 2022, CYPRESS COURT’s public adjuster, Jimmy Farach of All Risk Claims Consultants, Mr. Bret Samboy, and Mr. Mark Negri completed a physical inspection of the exteriors and elevations of all four (4) buildings and documented extensive roof shingle damage.
CYPRESS COURT through its public adjuster followed up with WESTCHESTER’s representatives regarding a coverage decision on the claim, receiving no timely response. On February 9, 2023, CYPRESS COURT’S public adjuster provided Mr. Negri with his preliminary damage estimates. Having received the estimates, WESTCHESTER retained a building consultant, J.S. Held, to re-inspect the Property. On March 7, 2023, CYPRESS COURT’s public adjuster met with J.S Held’s representatives and a re-inspection of the roofing systems, exterior items, and numerous interior units took place.
On June 8, 2023, WESTCHESTER informed CYPRESS COURT that J.S. Held’s inspection revealed damages attributable to wind as well as pre-existing damages. Thus, WESTCHESTER engaged an engineer from Stephens Engineering to investigate the cause(s) of loss and related damages. WESTCHESTER further requested that no permanent repairs be completed to the Property until its engineer had the opportunity to re-inspect.
WESTCHESTER’s unreasonable delay in adjusting the claim and its request that no permanent repairs take place eight (8) months after the hurricane made landfall, further exacerbated the insured’s financial burden because CYPRESS COURT was unable to comply with HUD guidelines.
CYPRESS COURT made the Property available and Stephens Engineering re-inspected the Property on July 12, 2023. Stephens Engineering published a causation report dated August 2, 2023.
CYPRESS COURT’s public adjuster communicated with WESTCHESTER’s adjuster regarding coverage determination, but WESTCHESTER stated that it was waiting for the building consultant, J.S. Held, to provide an updated scope of work and estimate following the review of Stephens Engineering’s report. WESTCHESTER’s failure to timely pay the claim was not caused by factors beyond the control of the insurer, as defined in Section 627.70131(5)(a)(1).
On October 8, 2023, CYPRESS COURT’S public adjuster again wrote to WESTCHESTER informing it that the insured’s claim was at a standstill and that CYPRESS COURT needed to move forward with the repairs to mitigate the damage to the Property. CYPRESS COURT provided WESTCHESTER with damage repair estimates totaling $1,631,418.96 replacement cost value and $1,499,808.61 actual cash value. CYPRESS COURT further provided WESTCHESTER with (1) Above & Beyond Exterior Bid for siding replacement, wood framing, removal and replacement of aluminum windows and sliding patio doors; (2) Global Enterprise South Florida roof tarping invoice; (3) Dr. Kool HVAC invoices and permits; and (4) invoice for electrical repairs.
On December 18, 2023, well over a year after CYPRESS COURT reported the claim, WESTCHESTER acknowledged partial coverage under the Policy. It further alleged that the Policy excluded a portion of the claim for damage sustained by repeated and long-term exposure to moisture, wear and tear, and mechanical damage. The value of loss to CYPRESS COURT’s Property after taking into consideration the recoverable depreciation and deductible, as determined by WESTCHESTER’s consultants was as follows:
Building 1 - $34,880.12
Building 2 - $46,854.14
Building 3 - $42,931.39
Uncategorized - $70,352.86
ACV Payment - $195,018.51
Less Prior Payment - $175,000.00
Total Payment Owed - $20,018.51
On or about March 19, 2024, WESTCHESTER continued to adjust the claim and in accordance with J.S. Held’s revised estimates, WESTCHESTER issued a net supplemental payment for $1,420.30. Though still deficient, this supplemental payment is further evidence that WESTCHESTER improperly adjusted and investigated CYPRESS COURT’s claim nearly 18 months after Hurricane Ian.
CYPRESS COURT disputed WESTCHESTER’s coverage determination and retained the services of the undersigned to protect its contractual rights. CYPRESS COURT has been obligated to incur attorney’s fees and costs and continues to suffer financial hardship as a result of WESTCHESTER’s inaccurate denial of a portion of the claim.
CYPRESS COURT retained Eduard C. Badiu, PhD, P.E. of CEBB Engineering & Testing Co. to assess and determine the cause and origin of damage. Dr. Badiu inspected the Property on November 7, 2022, and published a Damage Evaluation Report dated December 7, 2022. Dr. Badiu opined within a reasonable degree of engineering certainty that the roofs and exterior structures incurred direct physical damage from Hurricane Ian. He provided the following methodology of repairs:
Roofs
The wind damage to the roofing systems was not only cosmetic in nature, as alleged by WESTCHESTER in order to exclude coverage under the Policy’s Cosmetic Damage Roof Exclusion endorsement, but the function and usefulness of the roofs have been irreparably compromised. Dr. Badiu recommended full roof replacement to all four (4) buildings due to extensive wind damage, as well as the concealed damage underneath the tarpaulin covering the subject roof systems.
Exteriors
Dr. Badiu determined that the observed damage to the windows was caused by wind and wind-borne debris. Regarding the exterior damage he recommended the following:
• The damaged metal soffits and fascia covers shall be removed and replaced;
• The damaged wall panel substrate wall shall be replaced anew;
• Missing/broken/disengaged vinyl siding, trim, and vented soffits throughout the entire structures shall be replaced anew;
• Disengaged, missing, or otherwise damaged wood fascia boards, panels, and wood
trim shall be replaced anew;
• All the damaged engineered wood panels shall be removed and replaced;
• The damaged entrance stairways and handrails shall be replaced anew;
• All the damaged/disengaged/shifted downspouts shall be replaced anew;
• The damaged electrical meter-covered sheds shall be replaced anew;
• The damaged parking lot light fixtures shall be replaced anew;
• Missing or otherwise damaged walls at the entrances of Building B, South elevation, shall be designed and rebuilt in accordance with 2020 Florida Building Code – Building for new construction.
The covered damages claimed CYPRESS COURT by are itemized in All Risk Claims Consultants, Inc.’s estimates:
Loc. No. Bld. No. RCV ACV
1 1 (A) $507,351.52 $470,181.77
1 2 (B) $572,994.50 $521,597.93
1 3 (C) $525,290.46 $483,343.11
TOTAL $1,605,636.48 $1,475,122.81
The Policy’s Loss Payment provision provides that WESTCHESTER must pay for covered loss or damage within 90 days of receiving notice of an initial claim and if a portion of the claim is denied, then the 90-day time period for payment of claim relates to the portion of the claim that is not denied.
For the reasons stated above, WESTCHESTER breached the Policy when without justification delayed making a coverage decision within the 90-day period for payment related to the portion of the claim it accepted coverage. WESTCHESTER issued a Partial Declination of Coverage and Loss Indemnity Payment letter on December 18, 2023, well over a year after CYPRESS COURT initially reported the claim to WESTCHESTER.
WESTCHESTER is in violation of one or more provisions of the Florida Insurance Code. Section 627.70131, Florida Statutes, provides in pertinent part:
(7)(a) Within 60 days after an insurer receives notice of an initial, reopened, or supplemental property insurance claim from a policyholder, the insurer shall pay or deny such claim or a portion of the claim unless the failure to pay is caused by factors beyond the control of the insurer…Any payment of an initial or supplemental claim or portion of such claim made 60 days after the insurer receives notice of the claim… bears interest at the rate set forth in s. 55.03.
7(b) Notwithstanding subsection (5), for purposes of this subsection, the term “claim” means any of the following:
1. A claim under an insurance policy providing residential coverage as defined in s. 627.4025(1);
Section 627.4025, Florida Statutes, defines residential coverage as follows:
(1) Residential coverage includes…commercial lines residential coverage, which consists of the type of coverage provided by condominium association, cooperative association, apartment building, and similar policies, including policies covering the common elements of a homeowners association. Residential coverage for personal lines and commercial lines as set forth in this section includes policies that provide coverage for particular perils such as windstorm and hurricane or coverage for insurer insolvency or deductibles.
To date, WESTCHESTER has issued total net payments to CYPRESS COURT in the amount of $196,438.81. Pursuant to Section 627.70131(7)(a), Florida Statutes, interest begins to accrue from the date WESTCHESTER received notice of the claim on October 8, 2022, and it may not be waived, voided, or nullified by the terms of the insurance policy.
WESTCHESTER was required to pay statutory interest to CYPRESS COURT when it paid a portion of the claim. WESTCHESTER’s failure to comply with Section 627.70131(7)(a), Florida Statutes, constitutes a violation of this code.
WESTCHESTER further violated §624.155(1)(b)(3), Fla. Stat., when it failed to promptly settle the claim when the obligation to settle had become reasonably clear. This is evidenced by the fact that WESTCHESTER ignored covered damages based on the engineer’s reports, public adjuster’s estimates, and invoices for the actual costs incurred for the temporary repairs CYPRESS COURT submitted to WESTCHESTER.
WESTCHESTER failed to employ standards for the proper investigation of CYPRESS COURT’s claim which includes promptly re-inspecting the damages, when placed on notice regarding a dispute, communicating with the insured, and retaining competent and impartial engineers and independent adjusting companies for the investigation of damages.
Had WESTCHESTER carried out a proper investigation and had it hired qualified consultants from the inception of the claim, WESTCHESTER would not have delayed claim resolution or ignored the covered damage to CYPRESS COURT’s detriment. CYPRESS COURT was forced to retain a public adjuster and an engineer to provide details about material aspects of the claim, including the cause of loss as well as claimed damages.
WESTCHESTER violated Section 624.155(1)(b)(1), Florida Statutes, when it failed to attempt in good faith to settle the claim 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 its interests. Specifically, had WESTCHESTER acted fairly and honestly toward CYPRESS COURT and with due regard for its interests WESTCHESTER would have attempted to settle the claim with the public adjuster and/or participated in appraisal pursuant to the terms of the Policy. WESTCHESTER has ignored covered damage during the investigation of the claim.
Within every insurance policy is an implicit duty of good faith and fair dealing. This duty of good faith obligates the insurer to handle its insured’s claims with “the same degree of care and diligence as a person of ordinary care and prudence should exercise in the management of his own business.” Boston Old Colony Ins. Co. v. Gutierrez, 386 So.2d 783 (Fla. 1980). WESTCHESTER had a duty to act in good faith and with due regard for the interests of CYPRESS COURT but failed to do so.
Even though CYPRESS COURT has complied with all other post-loss obligations under the Policy, WESTCHESTER continues to deny additional payment to CYPRESS COURT that is due and owing under the Policy.
To date, WESTCHESTER has failed and/or refused to provide CYPRESS COURT with all the insurance benefits due and owing, despite knowing that CYPRESS COURT has sustained covered damages to the insured Property.
The adjusters assigned to this claim have a duty to adjust and treat all claims equally. Since the beginning of this claim, the representatives on behalf of WESTCHESTER have approached this investigation in a manner prejudicial to CYPRESS COURT.
WESTCHESTER has a contractual obligation not to make a perfunctory investigation, and to not ignore evidence that would support CYPRESS COURT’s claim. This is a breach of the Policy. WESTCHESTER has a contractual obligation not to look the other way when confronted with facts revealing the possibility of coverage and resisting reasonable interpretations of its policy. This is a breach of the Policy.
This notice is given in order to perfect the right to pursue the civil remedy authorized by Florida Statute, including any and all bad faith/extra contractual, should WESTCHESTER fail to cure the violations set forth in this Civil Remedy Notice within the given cure period.
While no specific “cure amount” is required for this Civil Remedy Notice to be valid, CYPRESS COURT will consider the allegations contained herein “cured” if WESTCHESTER:
(1) Immediately tenders to CYPRESS COURT the net sum of $1,153,775.00, after the application of the deductible, prior payments, and recoverable depreciation, which accurately reflects the true nature and extent of the total disputed damages, without a requirement for a release from CYPRESS COURT.
(2) Immediately tenders CYPRESS COURT the amount of statutory interest on the new payment pursuant to §627.70131(7)(a), Florida Statutes, at rate set forth in s. 55.03.
(3) Immediately tenders CYPRESS COURT the amount of statutory interest on the prior payment of $196,438.81, pursuant to §627.70131(7)(a), Florida Statutes, at rate set forth in s. 55.03.
CYPRESS COURT continues to remain open to a fair and reasonable settlement offer from WESTCHESTER in an effort to avoid additional delay, costs and expenses, and hereby requests the same prior to the expiration of the statutory “cure” period. WESTCHESTER must act fairly and honestly in its response to CYPRESS COURT’s request for a prompt, fair and reasonable settlement offer and resolution of its claim.
|
|
*
|
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.
|
DFS-10-363
Rev. 10/14/2008
|