Filing Number: 802673
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| Filing Accepted: 1/21/2025 |
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SIEGEL
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First Name |
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HARRIET |
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| Street Address
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5259 EUROPA DR. APT. C |
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BOYNTON BEACH,
FL
33437
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| Email Address
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WITHHELD |
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Insured |
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| Last/Business Name* |
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SIEGEL |
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First Name |
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HARRIET |
| Policy # * |
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141270927 |
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Claim #* |
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0763459401 |
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Attorney is Applicable
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| Last Name* |
LONG
First Name *
JESSE
Initial
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| Street Address* |
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1499 W PALMETTO PARK RD. STE. 216 |
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BOCA RATON
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FL
33486
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| Email Address * |
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JESSE@LEGAL-GRIT.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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NAIC Company Code 30511 |
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| Name of individual responsible for violation (if any):*
ANY AND ALL ADJUSTERS, SUPERVISORS, MANAGEMENT, ATTORNEYS AND INDIVIDUALS ASSOCIATED WITH OR RETAINED BY CASTLE KEY INSURANCE COMPANY, INVOLVED WITH THE HANDLING OF THIS CLAIM INCLUDING BUT NOT LIMITED TO THE FOLLOWING: CASTLE KEY INSURANCE COMPANY’S
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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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Claim Delay
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Unsatisfactory Settlement Offer
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Unfair Trade Practice
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Other
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Violation of Adjusters’ Ethical Requirements; not adjusting claims and evaluating the loss properly,
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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)(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)(d) |
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Denying claims without conducting reasonable investigations based upon available information.
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| 626.9541(1)(i)(3)(e) |
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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.
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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)(o)(1) |
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Knowingly collecting any sum as a premium or charge for insurance, which is not then provided, or is not in due course to be provided, subject to acceptance of the risk by the insurer, by an insurance policy issued by an insurer as permitted by this code.
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| 626.9541(1)(i)(4) |
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Failing to pay undisputed amounts of partial or full benefits owed under first-party property insurance policies within 60 days after an insurer receives notice of a residential property insurance claim, determines the amounts of partial or full benefits, and agrees to coverage, unless payment of the undisputed benefits is prevented by factors beyond the control of the insurer as defined in s. 627.70131(5).
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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.
FLORIDA STATUTES VIOLATED (continued)
§627.70131(1)(a) - Upon an insurer’s receiving a communication with respect to a claim, the insurer shall, within 7 calendar days, review and acknowledge receipt of such communication unless payment is made within that period of time or unless the failure to acknowledge is caused by factors beyond the control of the insurer. If the acknowledgment is not in writing, a notification indicating acknowledgment shall be made in the insurer’s claim file and dated. A communication made to or by a representative of an insurer with respect to a claim shall constitute communication to or by the insurer.
§627.70131(2) - Such acknowledgment must be responsive to the communication. If the communication constitutes a notification of a claim, unless the acknowledgment reasonably advises the claimant that the claim appears not to be covered by the insurer, the acknowledgment must provide necessary claim forms, and instructions, including an appropriate telephone number.
§627.70131(3)(a) - Unless otherwise provided by the policy of insurance or by law, within 7 days after an insurer receives proof-of-loss statements, the insurer shall begin such investigation as is reasonably necessary unless the failure to begin such investigation is caused by factors beyond the control of the insurer.
§627.70131(3)(b) - If such investigation involves a physical inspection of the property, the licensed adjuster assigned by the insurer must provide the policyholder with a printed or electronic document containing his or her name and state adjuster license number. An insurer must conduct any such physical inspection within 30 days after its receipt of the proof-of-loss statements.
§627.70131(3)(c) - Any subsequent communication with the policyholder regarding the claim must also include the name and license number of the adjuster communicating about the claim. Communication of the adjuster’s name and license number may be included with other information provided to the policyholder.
§627.70131(3)(e) - The insurer must send the policyholder a copy of any detailed estimate of the amount of the loss within 7 days after the estimate is generated by an insurer’s adjuster. This paragraph does not require that an insurer create a detailed estimate of the amount of the loss if such estimate is not reasonably necessary as part of the claim investigation.
§627.70131(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. The insurer shall provide a reasonable explanation in writing to the policyholder of the basis in the insurance policy, in relation to the facts or applicable law, for the payment, denial, or partial denial of a claim. If the insurer’s claim payment is less than specified in any insurer’s detailed estimate of the amount of the loss, the insurer must provide a reasonable explanation in writing of the difference to the policyholder. Any payment of an initial or supplemental claim or portion of such claim made 60 days after the insurer receives notice of the claim, or made after the expiration of any additional timeframe provided to pay or deny a claim or a portion of a claim made pursuant to an order of the office finding factors beyond the control of the insurer, whichever is later, bears interest at the rate set forth in s. 55.03. Interest begins to accrue from the date the insurer receives notice of the claim. The provisions of this subsection may not be waived, voided, or nullified by the terms of the insurance policy. If there is a right to prejudgment interest, the insured must select whether to receive prejudgment interest or interest under this subsection. Interest is payable when the claim or portion of the claim is paid. Failure to comply with this subsection constitutes a violation of this code. However, failure to comply with this subsection does not form the sole basis for a private cause of action.
RELEVANT POLICY LANGUAGE
Castle Key Insurance Company (the “Insurance Company”) issued policy of insurance number 141270927 (the “Policy”) to Harriet Siegel and Melvin Siegel (Deceased) (the “Insured”) for the property located at 5259 Europa Dr. C, Boynton Beach, FL 33437-5257 (the “Property”). The Policy covers all risks unless expressly excluded or limited. On or about 6/23/2024, the Property sustained direct physical and resultant damage as the result of a sudden and accidental plumbing failure. Although the Policy provides coverage for all the losses, damages, and expenses the Insured suffered and incurred, the Insurance Company has failed and refused to compensate the Insured for all damage sustained to the Property as well as their contents and additional living expenses. The specific policy language at issue includes, but may not be limited to, the Insurance Company’s express obligation to insure against risk of direct loss to property described in Coverages A, C, D and any Additional Coverages. To the best of the Insured’s information and belief, specific policy language that is known and relevant to the violations referenced herein includes, but is not limited to the following:
See Subject Policy number 141270927.
SECTION I – YOUR PROPERTY COVERAGE A
Building Property Protection
Property We Cover Under Coverage A: We will cover items of real property owned exclusively by an insured person that:
1. do or will comprise a part of the residence premises;
2. are used to service or support your residence premises; and
3. are your insurance responsibility as expressed the governing rules of the condominium association.
"Real property includes only those fixtures, structures, construction material and supplies, installations or additions located either within that portion of the premises used as your residence premises or on the condominium premises that benefits you and fewer than all unit owners.
Property We Do Not Cover Under Coverage A:
We do not cover land.
Losses We Cover Under Coverage A:
We will cover sudden and accidental direct physical loss to the property described in Coverage A – Property Protection, except as limited or excluded in this policy.
Coverage C
Personal Property Protection
Property We Cover Under Coverage C:
1. Personal property owned or used by an insured person anywhere in the world. When personal property is located at a residence other than the residence premises, coverage is limited to 10% of Coverage C – Personal Property Protection. This limitation does not apply to personal property in a newly acquired principal residence for the 30 days immediately after you begin to move property there or to personal property in student dormitory, fraternity or sorority housing.
2. At your option, personal property owned by a guest or residence employee while the property is in a residence you are occupying."
[***]
Losses We Cover Under Coverage C:
We will cover sudden and accidental direct physical loss to the property described in Coverage C –Personal Property Protection, except as limited or excluded in this policy, caused by:
[***]
12. Bulging, burning, cracking or rupture of a steam or hot water heating system, an air conditioning system, an automatic fire
protection system or an appliance for heating water.
13. Water or steam that escapes from a plumbing, heating or air conditioning system, an automatic fire protection system or from a
appliance due to accidental
discharge or overflow."
***
LOSSES WE DO NOT COVER UNDER COVERAGES A AND C:
We do not cover loss to property described in
Coverage A – Building Property Protection or C – Personal Property Protection caused by or consisting of:
"1. Flood, including, but not limited to, surface water, waves, tidal water or overflow of any body of water, or spray from any of these, whether or not driven by wind.
2. Water or any other substance that backs up through sewers or drains.
3. Water or any other substance that overflows from a sump pump, sump pump well or any other system designed for the removal of subsurface water which is drained from a foundation area of a structure.
4. Water or any other substance on or below the surface of the ground, regardless of its source.
This includes water or any other substance which exerts pressure on, or flows, seeps or leaks through the residence premises.
We do cover sudden and accidental direct physical loss caused by fire, explosion or theft resulting from items 1 through 4 listed above.
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3. WHAT YOU MUST DO AFTER A LOSS
In the event of a loss to any property that may be covered by this policy, you must:
"us or our agent notice.
Report any theft to the police as soon as possible. If the loss involves a credit card, charge plate or bank fund transfer card, give written notice to the company or bank that issued the card or plate.
b) protect the property from further loss. Make any reasonable repairs necessary to protect it. Keep an accurate record of any repair expenses.
c) separate damaged from undamaged personal property. Give us a detailed list of the damaged, destroyed or stolen property, showing the quantity, cost, actual cash value and the amount of loss claimed.
d) give us all accounting records, bills, invoices and other vouchers, or certified copies, which we may reasonably request to examine and permit us to make copies.
e) produce receipts for any increased costs to maintain your standard of living while you reside elsewhere, and records supporting any claim for loss of rental income.
f) as often as we reasonably require:
1) show us the damaged property.
2) at our request submit to examinations under oath, separately and apart from any other person defined as you or insured person and sign a transcript of the same.
3) produce representatives, employees, members of the insured's household or others to the extent it is within the insured person's power to do so; and
g) within 60 days after the loss, give us a signed, sworn proof of the loss. This statement must include the following information:
1) the date, time, location and cause of loss;
2) the interest insured persons and others have in the property, including any encumbrances;
3) the actual cash value and amount of loss for each item damaged, destroyed or stolen;
4) other insurance that may cover the loss;
"5) any changes in title, use, occupancy or possession of the property that have occurred during the policy period;
6) at our request, the specifications of any damaged building alteration or improvement;
7) evidence supporting any claim under the Credit Card, Bank Fund Transfer Card, Check Forgery And Counterfeit Money protection. State the cause and amount of loss.
4. How We Pay For A Loss
Within 90 days after we receive notice of a claim under Coverage A – Building Property
Protection and Coverage C – Personal Property Protection from you, we shall pay or deny such claim or a portion of the claim unless the failure to pay such claim or a portion of the claim is caused by factors beyond our control which reasonably prevents such payment. Claims will be paid within 20 days of written agreement between you and us. Under Coverage A – Building Property Protection, and Coverage C – Personal Property Protection, payment for covered loss will be by one of the following methods:
a) Actual Cash Value Method
Except as provided in the Building Property Replacement Cost Method or Personal Property Replacement Cost Method provisions, payment for a covered loss will be on an actual cash value basis. This means there may be a deduction for depreciation. Payment will not exceed the limit of liability shown on the Policy Declarations for the coverage that applies to the damaged, destroyed or stolen property, regardless of the number of items involved in the loss.
b) Building Property Replacement Cost Method Except as otherwise provided below, payment for a covered loss under Coverage A – Building
a replacement cost basis, meaning that the amount we pay you for the damaged, destroyed or stolen covered property will not include a deduction for depreciation. When we make payment on a replacement cost basis, our payment will not be conditioned on you actually repairing, replacing the damaged, destroyed or stolen covered property.
[***]
5. Our Settlement Of Loss
We will settle any covered loss with you unless another payee is named in the policy. We will settle within 20 days after the amount of loss is finally determined. This amount may be determined by an agreement between you and us, an appraisal award or a court judgment.
Under Coverage A – Building Property Protection, the condominium association shall be treated as a loss payee.
[***]
9. Our Right to Recover Payment
When we pay for any loss, an insured person's right to recover from anyone else becomes ours up to the amount we have paid. An insured person must protect these rights and help us enforce them. You may waive your rights to recover against another person for loss involving the property covered by this policy. This waiver must be in writing prior to the date of loss.
[***]
17. Mold, Fungus, Wet Rot And Dry Rot Remediation As A Direct Result Of A Covered Water Loss
In the event of a covered water loss under Coverage A – Building Property Protection or Coverage C – Personal Property Protection, we will pay up to $10,000 for mold, fungus, wet rot or dry rot remediation.
However, if a premium is shown on the Policy Declarations for Optional Protection For Mold, we will pay up to the applicable limit of liability shown on the Policy Declarations for Optional
Protection For Mold for mold, fungus, wet rot or dry rot remediation.
If a premium is shown on the Policy Declarations for Optional Protection For Mold:
a) the "Remediation" limit shown on the Policy Declarations for Optional Protection For Mold is the maximum we will pay for all mold, fungus, wet rot or dry rot remediation resulting from any one covered water loss; and
b) the "Aggregate Remediation" limit shown on the Policy Declarations for Optional Protection For Mold is the maximum we will pay for all mold, fungus, wet rot or dry rot remediation resulting from all covered water losses during the premium period, regardless of the number of locations insured under the policy or number of claims made. This "Aggregate Remediation" limit is subject to the "Remediation Limit
Remediation means the reasonable and necessary treatment, removal or disposal of mold, fungus, wet rot or dry rot as required to complete repair or replacement of property we cover under Coverage A – Building Property Protection or Coverage C – Personal Property Protection damaged by a covered water loss, including payment for any reasonable increase in living expenses necessary to maintain your normal standard of living if mold, fungus, wet rot or dry rot makes your residence premises uninhabitable. Remediation also includes any investigation or testing to detect, measure or evaluate mold, fungus, wet rot or dry rot.
This Condition does not increase the limits of liability under Coverage A – Building Property
tion or Coverage C – Personal Property Protection.
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Policy Endorsement
The following endorsement changes your policy.
Please read this document carefully and keep it with your policy.
Florida Condominium Policy Amendatory Endorsement – AP4766-3
[***]
D. The following provisions are added:
Notice
If a company employee adjuster, independent adjuster, attorney, investigator, or other person acting on our behalf needs access to an insured person or claimant or to the insured premises that is the subject of a claim, that person must provide at least 48 hours’ notice to the insured person or claimant, public adjuster, or legal representative before scheduling a meeting with the claimant or an onsite inspection of the insured premises. The insured person or claimant may deny access to the insured premises if notice has not been provided. The insured person or claimant may waive the 48 hour notice.
Loss Reduction And Other Items
From time to time and at our sole discretion:
1. we may provide you, or allow others to provide you, with:
a) items, memberships, special offers, merchandise, points, rewards, airline miles, services, classes, seminars, or other things of value designed to help you or other persons insured under this policy manage the risks you or they face, including, but not limited to, loss reduction or safety-related items; or
b) items, memberships, special offers, merchandise, points, rewards, airline miles, services, classes, seminars, or things of any other type that we think may be of value to you or someone else insured under this policy.
2. we may make, or allow others to make, one or more of the following: charitable contributions, donations, or gifts.
These items, memberships, special offers, merchandise, points, rewards, airline miles, services, classes, seminars, charitable contributions, donations, gifts, or other things of value may be provided in any form, including, but not limited to, redemption codes, coupons, vouchers, and gift cards.
II. In Section I—Your Property, the following changes are made:
A. In Building Property Protection–Coverage A, the Property We Cover Under Coverage A provision is replaced by the following: Property We Cover Under Coverage A:
We will cover building property, meaning items of real property owned exclusively by an insured person that:
1. do or will comprise a part of the residence premises;
2. are used to service or support your residence premises; or
3. are your insurance responsibility as expressed under the governing rules of the condominium association.
Real property includes only those fixtures, structures, construction material and supplies, installations or additions located either within that portion of the premises used as your residence premises or on the condominium premises that benefits you and fewer than all unit owners. Real property also includes structures owned solely by you, other than the residence premises, at the location of the residence premises.
B. In Personal Property Protection–Coverage C, the following changes are made:
1. Under Losses We Cover Under Coverage C , the paragraph after item 14 is replaced by the following:
We do not cover loss at the residence premises under perils 12, 13, and 14 caused by or resulting from freezing while the building is vacant or under construction unless you have used reasonable care to:
a) maintain heat in the building; or
b) shut off the water supply and drain the water from the systems and appliances.
2. Under Losses We Do Not Cover Under Coverages A and C , items 4, 5, 9, 15, and 17 are replaced by the following:
4. Water or any other substance on or below the surface of the ground, regardless of its source. This includes water or any other substance which exerts pressure on, or flows, seeps or leaks through any part of the residence premises. Except as otherwise excluded under items 1 through 3 above, this exclusion does not apply to the sudden and accidental discharge of water.
5. Earth movement of any type, including, but not limited to, earthquake, volcanic eruption, lava flow, landslide, subsidence, mudflow, pressure, sinkhole, erosion or the sinking, rising, shifting, creeping, expanding, bulging, cracking, settling or contracting of the earth. This exclusion applies whether or not the earth movement is combined with water. However, we will not apply this exclusion to sudden and accidental direct physical loss which consists of, or is caused by
[***]
17. Seepage, meaning continuous or repeated seepage or leakage over a period of weeks, months or years, of water, steam or fuel, including but not limited to any condensation, moisture, humidity or vapor:
a) from a plumbing, heating, air conditioning or automatic fire protection system within the condominium or from within a domestic appliance; or
b) from within or around any plumbing fixtures, including, but not limited to, shower stalls, shower baths, tub installations, sinks or other fixtures designed for the use of water or steam.
This exclusion applies to all loss resulting from the first day onward of the seepage that continued for a period of weeks, months, or years.
C. In Section I, Additional Protection, the following changes
are made:
1. Under item 1, Additional Living Expense, sub item a) is replaced by the following:
1. Additional Living Expense
a) We will pay the reasonable increase in living expenses necessary to maintain your normal standard of living when a direct physical loss we cover under Building Property
Protection–Coverage A or Personal Property Protection–Coverage C makes your condominium or the building structure containing your residence premises uninhabitable. However, additional living expense due to remediation of mold, fungus, wet rot or dry rot will not be paid in addition to any amounts paid or payable under Section I Conditions, Mold, Fungus, Wet Rot and Dry Rot Remediation As A Direct Result Of A Covered Water Loss . Payment for additional living expense as a result of a covered loss under Building Property Protection–Coverage A or Personal Property Protection–Coverage C will be limited to the least of the following:
1) the time period required to repair or replace the property we cover, using due diligence and dispatch;
2) if you permanently relocate, the shortest time for your household to settle elsewhere;
3) 12 months; or
4) 10% of the limit of liability as shown on the Policy Declarations for Personal Property Protection–Coverage C.
[***]
3. The Temporary Repairs After A Loss provision is replaced by the following:
6. Reasonable Emergency Measures
a) We will pay up to the greater of $3,000 or one percent of the limit of liability shown on the Policy Declarations for Building Property
Protection–Coverage A for the reasonable and necessary costs incurred by you for measures taken solely to protect covered property from further covered loss following a loss we cover.
b) We will not pay more than the amount in 6.a) above, unless we agree within 48 hours of your request to us to exceed that limit. If we agree to exceed that limit, we will pay only up to the additional amount for the measures we authorize. If we fail to respond to you within 48 hours of your request to us to exceed that limit, and the damage or loss is caused by a peril insured against, you may exceed the limit indicated in 6.a) above only up to the cost incurred by you for the reasonable and necessary emergency measures necessary to protect the covered property from further covered loss.
c) If, however, a covered loss occurs during a hurricane, the amount we pay under this additional protection is not limited to the amount in 6.a) above.
d) A reasonable measure under this provision may include a permanent repair when necessary to protect the covered property from further damage or to prevent unwanted entry to the property. To the degree reasonably possible, any damaged property must be retained by you for our inspection.
This protection does not increase the limit of liability applying to the covered property.
D. In Section I Conditions, the following changes are made:
1. Under item 3, What You Must Do After A Loss, sub-item a) and sub-item b) are replaced by the following:
a) promptly give us or our agent notice. Report any theft to the police as soon as possible.
1) For loss caused by any peril, you must notify us of any resulting claim or reopened claim within one year after the date of loss. A reopened claim means a claim that we have closed but that has been reopened upon an insured person’s request for additional costs for loss or damage previously disclosed to us.
2) For loss caused by any peril, you must notify us of any resulting supplemental claim within 18 months after the date of loss. A supplemental claim means a claim for additional loss or damage from the same peril which we have previously adjusted or for which costs have been incurred while completing repairs or replacement pursuant to an open claim for which timely notice was previously provided to us.
3) For loss or claims resulting from hurricanes, tornadoes, windstorms, severe rain, or other weather-related events, the date of loss is the date that the hurricane made landfall or the tornado, windstorm, severe rain, or other weather-related event is verified by the National Oceanic and Atmospheric Administration.
The provisions listed in subparagraphs 1), 2) and 3) immediately above concerning time for submission of a claim, supplemental claim or reopened claim do not affect any limitation for legal action against us as provided in this Policy under the Suit Against Us provision, including any amendment to that provision.
4) If the loss was not a result of sinkhole, hurricane or is not a reasonable emergency measure taken under Reasonable Emergency Measures, there is no coverage for permanent repairs that begin before the earlier of:
a) 72 hours after we are notified of the loss
b) the time of the loss inspection by us; or
c) the time of other approval by us.
[***]
2. Under item 3, What You Must Do After A Loss, the following paragraph is added:
We have no duty to provide coverage under this section if you fail to comply with items a) through g) above, and this failure to comply is prejudicial to us.
3. Item 4, How We Pay For A Loss, is revised as follows:
a) The first paragraph of the How We Pay For A Loss provision is replaced by the following:
Within 60 days after we receive notice of an initial, reopened, or supplemental claim under Building Property Protection–Coverage A or Personal Property Protection–Coverage C from you, we shall pay or deny such claim or a portion of the claim unless the failure to pay such claim or a portion of the claim is caused by factors beyond our control. Claims will be paid within 20 days of written agreement between you and us, except as provided in subparagraph b)(1) below regarding the payment of amounts for underpinning or grouting. Under Building Property Protection–Coverage A and Personal Property Protection–Coverage C, payment for covered loss will be by one or more of the following methods:
b) The Actual Cash Value Method provision is replaced by the following:
a) Actual Cash Value Method
Except as provided in the Personal Property Replacement Cost Method provision below, if you do not repair or replace the damaged, destroyed or stolen property, payment will be on an actual cash value basis. This means there may be a deduction for depreciation. Payment will not exceed the limit of liability shown on the Policy Declarations for the coverage that applies to the damaged, destroyed or stolen property, regardless of the number of items involved in the loss.
You may make claim for additional payment as described in paragraph b) below, if applicable, if you repair or replace the damaged, destroyed or stolen covered property.
c) The Building Property Replacement Cost Method provision is replaced by the following:
b) Building Property Replacement Cost Method Except as otherwise provided below, we will make additional payment to reimburse you for cost in excess of actual cash value if you repair, rebuild or replace damaged, destroyed, or stolen covered property under Building Property
Protection–Coverage A. We will make payment as the repair, rebuilding or replacement work is performed and expenses are incurred.
Payment for total loss to property covered under Building Property Protection–Coverage A will be on a replacement cost basis, meaning that the amount we pay you for the repair, rebuilding or replacement of the damaged, destroyed or stolen covered property will not include a deduction for depreciation.
[***]
Payment under this Building Property Replacement Cost Method will include the cost to treat or remove and dispose of contaminants, toxins or pollutants as required to complete repair or replacement of that part of the residence premises which is your insurance responsibility as expressed under the governing rules of the condominium damaged by a covered loss; but only to the extent such losses are not otherwise excluded under items 10, 13 or 14 of the Losses We Do Not Cover Under Coverages A and C provision.
This payment shall not include any amounts which may be paid or payable under Section I Conditions, Mold, Fungus, Wet Rot And Dry Rot Remediation As A Direct Result Of A Covered Water Loss , and shall not be payable for any losses excluded in Section I—Your Property, under Losses We Do Not Cover Under Coverages A and C , item 21.
Our total payment under this Building Property Replacement Cost Method provision will not exceed the smallest of the following amounts:
1) the reasonable and necessary cost to replace the damaged part(s) of the building property with equivalent construction for similar use on the same residence premises;
2) the reasonable and necessary cost to repair the damaged part(s) of the building property with equivalent construction for similar use on the same residence premises; or
3) the limit of liability applicable to the building property as shown on the Policy Declarations for Building Property Protection–Coverage A.
This Building Property Replacement Cost Method will not apply to:
property covered under Personal Property Protection-Coverage C; or
2) fences, awnings and outdoor antennas, whether or not attached to a building structure.
Payment under Section I Conditions, item 4, How We Pay For A Loss, sub-items a) Actual Cash Value Method or b) Building Property Replacement Cost Method above will not include any increased costs due to the enforcement of any building codes, ordinances or laws regulating the construction, reconstruction, maintenance, repair, relocation or demolition of building property or other structures except as provided under Section I, Additional Protection, item 11, Building Codes.
d) Under subsection c) Personal Property Replacement Cost Method, item 1 of the third paragraph is replaced by the following:
1) property insured under Building Property Protection–Coverage A;
4. Item 5, Our Settlement Of Loss, is replaced by the following:
5. Our Settlement Of Loss
We will settle any covered loss with you unless another payee is named in the policy or is legally entitled to receive payment. We will settle within 20 days after the amount of loss is finally determined. This amount may be determined by an agreement between you and us, an appraisal award, neutral evaluation of sinkhole activity loss, or a court judgment. Notwithstanding the foregoing, with respect to a covered sinkhole loss, as provided in Section I Conditions, item 4, How We Pay For A Loss, we will not pay any amounts for underpinning or grouting until you enter into a contract for the performance of building stabilization or foundation repairs.
5. Item 8, Permission Granted To You, is replaced by the following:
8. Permission Granted To You
a) The residence premises may be vacant for any length of time, except where a time limit is indicated in this policy for specific perils. A building under construction is not considered vacant.
b) You may make alterations, additions or repairs, and you may complete structures under construction.
6. Item 11, Suit Against Us, is replaced by the following:
11. Suit Against Us
No suit or action may be brought against us unless there has been full compliance with all policy terms. Any suit or action must be brought within five years after the date of loss. In addition, you must provide the Department of Financial Services with written notice of intent to initiate litigation at least 10 business days prior to filing any legal action against us in accordance with section 627.70152 of Florida Statutes.
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The following endorsement changes your policy.
Please read this document carefully and keep it with your policy.
Assignment Agreements Endorsement – AP5002
Under Section I Conditions, the following provision is added:
Assignment Agreements
You may not assign, in whole or in part, any post-loss insurance benefit under this policy, except as follows:
a) An assignment, transfer, or conveyance you have granted to a subsequent purchaser of the property with an insurable interest in the property following a loss;
b) A power of attorney under chapter 709 that grants to a management company, family member, guardian, or similarly situated person of an insured the authority to act on behalf of an insured as it relates to a property insurance claim; or
c) Liability coverage under a property insurance policy.
Any attempt other than the above listed exceptions to assign post-loss property insurance benefits under this policy is void, invalid, and unenforceable.
All other policy terms and conditions apply.
Ed. 05/23
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In Section I—Your Property, under Losses We Do Not Cover Under Coverages A and C, we have updated the Seepage exclusion to specify the inclusion of condensation, moisture, humidity and vapor, as well as an explanation that the exclusion applies to all loss resulting from the first day onward of the seepage that continued for a period of time.
In Section I Conditions, the following changes have been made:
Under What You Must Do After A Loss, we have updated the timeframe in which you must notify us of an resulting or reopened claim from two years after the date of loss to one year after the date of loss. We have also updated the timeframe in which you must notify us of any resulting supplemental claim from three years after the date of loss to 18 months after the date of loss.
Under How We Pay For A Loss, we have updated the timeframe in which we have to either pay or deny a claim from 90 days to 60 days after we receive notice of the initial, reopened, or supplemental claim.
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Policy Endorsement
The following endorsement changes your policy.
Please read this document carefully and keep it with your policy.
Amendatory Endorsement - AP4981
Throughout the policy, when determining the actual cash value of the loss, the costs necessary to repair, rebuild or replace the destroyed, damaged or stolen property may be depreciated. Such costs subject to depreciation may include, but are not limited to, goods, materials, equipment, labor, overhead and profit, taxes, fees or similar charges.
All other policy terms and conditions apply. Ed. 11/21
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Coverage A - Dwelling
Coverage C – Personal Property
Personal Property Replacement Cost
Law and Ordinance
Mold/Fungi
Building Code Effectiveness Grading Schedule
All Optional Coverage provisions
All Additional Coverage provisions
All Coverage(s) provided by Endorsement or Rider
The Declarations Page
Loss Payment or Settlement provision
Duties in Event of Loss Policy provision
The insurance policy's definition section
The insurance policy's exclusion of coverage provisions
All insurance policy provisions that provide coverage to the property
All policy provisions.
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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.
Form DFS-10-363, Rev. 10/14/2008, contains a field for the Insured to include their email address(es). Prior to filing the CRN, said form contains an instruction that, in the event the insureds do not with for certain information to become part of the public record, the insureds must simply include the term “WITHHELD” to satisfy the filing requirement. This is further established through the following statement with appears on Civil Remedy Notices which have been filed:
NOTE: Information submitted as part of this civil remedy notice is public record. Data entered into this form will be displayed on the DFS website for public review. Please DO NOT enter Social Security Numbers, personal medical information, personal financial information or any other confidential or private information you do not want available for public review.
As any information contained herein becomes part of the public record, the Insured has withheld their email addresses so as not to make same available for public review and indicated same accordingly. Furthermore, as the insureds are represented by counsel, it would be improper for any representative of Castle Key Insurance Company to contact the Insured directly for any reason utilizing their email addresses and, as such, the information is neither material to Castle Key Insurance Company’s ability to correct the violations contained herein nor required by the Department of Financial Services. Castle Key Insurance Company should direct all follow-up correspondences to the attorney listed above.
Furthermore, Form DFS-10-363, Rev. 10/14/2008, in the above section requesting people with knowledge as to the allegations in the instant CRN gets cut off, the following are those responsible for the violations alleged herein:
Furthermore, while Form DFS-10-363, Rev. 10/14/2008, does not provide a place for the address of the insurer to be input, the following are the addresses provided by Castle Key Insurance Company to the Florida Office of Insurance Regulation: ADMINISTRATIVE- 3100 SANDERS ROAD, SUITE 201, NORTHBROOK IL 60062-7154; HOME- 3100 SANDERS ROAD, SUITE 201, NORTHBROOK IL 60062-7154; MAILING- 3100 SANDERS ROAD, SUITE 201, NORTHBROOK IL 60062-7154; LOCATION OF RECORDS- 3100 SANDERS ROAD, SUITE 201, NORTHBROOK IL 60062-7154. Finally, as the above section requesting people with knowledge as to the allegations in the instant CRN often gets cut off, the following are those responsible for the violations alleged herein: ANY AND ALL ADJUSTERS, SUPERVISORS, MANAGEMENT, ATTORNEYS AND INDIVIDUALS ASSOCIATED WITH OR RETAINED BY CASTLE KEY INSURANCE COMPANY, INVOLVED WITH THE HANDLING OF THIS CLAIM INCLUDING BUT NOT LIMITED TO THE FOLLOWING: CASTLE KEY INSURANCE COMPANY’S HEAD GENERAL COUNSEL; AJA PARKS (FL LICENSE # W668395), CLAIMS EXAMINER; DAKOTA HORGER (FL LICENSE #W417038); GUSTAVO ARZUAGA (FL LICENSE #W756595) AND ANY ADDITIONAL REPRESENTATIVES FROM CASTLE KEY INSURANCE COMPANY INVOLVED IN THE ADJUSTMENT/INVESTIGATION OF THE CLAIM.
FACTS:
1) Failure to pay claim in full;
2) Failure to property investigate claim;
3) Failure to act in due diligence and good faith to resolve claim;
4) Placing financial interest of insurer before that of policy holders and claimants;
5) Failure to properly train, evaluate and manage adjusters;
6) Looking for ways to deny coverage, pay less, delay payment and otherwise “low ball” or “stone wall” claim;
7) The reasons for this may be attributed to improper training, supervision, and/or motivation of adjusters and claim supervisors to promptly and fairly investigate, adjust and pay full benefits available to all beneficiaries. The insurer may have failed to adopt proper standards of investigation and adjustment of losses or is otherwise not implementing those standards because full payment and prompt payment for the loss is not occurring.
In Florida, the work of adjusting insurance claims engages the Public Trust. CASTLE KEY INSURANCE COMPANY (“Insurance Company”) breached this duty by its improper adjustment of its Insured’s claim of loss. The Insurance Company’s handling and adjustment of its Insured’s claim of loss and the conduct of the adjusters, supervisors, management and individuals associated with or retained by the Insurance Company in this claim to date evidences that the Insurance Company has failed to create and implement adequate guidelines for the proper investigation to evaluate claims handling and for training and supervision of employees resulting in statutory violations set forth above. The Insurance Company has also failed and/or refused to thoroughly, accurately, and completely investigate and evaluate the Insured’s insurance claim for damages. To date, notwithstanding the Insured’s pleas for assistance, the Insurance Company has refused to pay the full amount of its Insured’s claim.
The following facts shall serve to outline the unreasonable delays, complete lack of claims handling by the Insurance Company resulting in no substantive investigation of the Insured’s claim and a substantially incomplete payment of the Insured’s claim to date, evidencing the Insurance Company’s pattern and practice of placing its own financial interests above that of its Insureds.
Castle Key Insurance Company (the “Insurance Company”) issued policy of insurance number 141270927 (the “Policy”) to Harriet Siegel and Melvin Siegel (deceased) (the “Insured”) for the property located at 5259 Europa Dr. C, Boynton Beach, FL 33437-5257 (the “Property”). The Policy covers all risks unless expressly excluded or limited.
On or about 6/23/2024, the Property sustained damages as a result of a direct physical loss and resultant ensuing from a sudden and accidental plumbing failure originating from a neighboring condominium unit. The Property sustained damage to the Bathroom (including linen closet) during a covered plumbing failure event. After becoming aware of the substantial damage to the Property, the Insured promptly reported the damage to the Insurance Company on or about 6/24/2024. Thereafter, Insurance Company acknowledged the claim and assigned claim number 0763459401 (the “Claim”). Following the Insured’s timely reporting of the Claim, the Insurance Company assigned adjustment of the claim to Dakota Horger (FL License #W417038)-claims examiner/desk adjuster, who is believed to have enlisted the assistance of a field adjuster, to perform an inspection of the Subject Property. During the reporting of the Loss, the Insured provided the Insurance Company with all of the information known to her at that time regarding the damages sustained at the Property, including what actions had been taken to protect the property, mitigate the damages and the facts known to her regarding the cause and origin of the covered water loss. Thereafter, the Insurance Company’s field adjuster completed its inspection of the Loss with the Insured and it was clear that he was not experienced and/or was disinterested in gaining relevant information supporting coverage under the Policy from the Insured. Further, it was evident throughout the inspection that the field adjuster was merely going through the perfunctory motions of the inspection without regard to detail.
On or about 8/21/2024, The Phoenix Restoration had been contacted by the Insured to assist in mitigating the Insured’s damages at the Property and prevent any further damage as a result of the Loss. Unfortunately, due to the extensive water damage from the subject loss, AAA Mold Inspectors, Inc. was hired by Servpro of Boynton Beach on behalf of the Insured and a field inspection was conducted by Yosi Noah, CMA FL on or about 8/22/2024. Additionally, due to concerns of mold growth resultant from the Loss, Mr. Noah was contracted to provide a mold protocol to remediate the resultant and ensuing mold damage from the Loss. According to Yosi Noah, CMA FL, his advice was that the Insured should remediate and replace the damaged areas as soon as practicable, based on the findings in their report which outlined in pertinent part:
AAA Mold Inspectors, Inc. was hired to conduct a limited mold assessment test to investigate if there is any elevated presence of perceptible elevated moisture, readily noticeable areas of possible prior elevated moisture and conditions supporting, conductive to or potentially supporting microbial contamination with regards to bacteria or mold/fungi growth in the above listed property address....During the inspection, it was determined to collect one swab sample and one indoor air sample and have them analyzed and investigated for mold spores. AAA Mold Inspectors, Inc. collected two air samples and one physical sample from the above-mentioned property...Yossi Joe Noah was escorted through the property an MVOC (microbial volatile organic compound) or an order was apparent. The property...revealed visible fungal growth and apparent water damage [at] the Guest Bathroom...Remediation Protocol, Recommendations & Procedures: Guest Bathroom: o Remove drywall 2 feet beyond the last visible mold.
o Remove ceiling 2 feet beyond the last visible mold.
o Sand & HEPA vacuum wood beams.
o Remove shower tile if necessary.
o HEPA clean and sanitize remaining walls, floors, air handlers, vents, ducts, AC coils, AC returns, hard surfaces, and fog with a fungicide.
o Exposed surfaces should be wiped down and sanitized.
o Depending on any hidden damage, more of the walls and baseboards may need to be removed…
The Insured (by way of ServPro of Boynton Beach) incurred $696.13 for the mold inspection and protocol. Thereafter, Phoenix Restoration quoted the mold remediation project for a total cost of $7,596.96. Phoenix’s reasonable and necessary mold remediation services as set forth in their estimate included but were not limited to the following: Main Level: Equipment setup, take down, and monitoring (hourly charge), Containment Barrier/Airlock/Decon. Chamber Peel & seal zipper - heavy duty, Ducting - flexible - 6" round, Floor protection - heavy paper and tape, Add for HEPA filter (for negative air exhaust fan), Add for HEPA filter (for canister/backpack vacuums), Negative air fan/Air scrubber (24 hr period) - No monit. 1 inside each containment and 1 outside the containment, Power distribution box (per day), Hydroxyl generator - odor counteractant - 3 optics 1 hydroxyl x 2 days, Dehumidifier (per 24 hr period)- 110-159 ppd - No monitor, 1 dehu x 3 days, Equipment decontamination charge - per piece of equipment, 2 air scrubbers, 1 dehu, 2 hydroxyl ,2 air movers, 1 hepa vac, 1 distribution box, Respirator cartridge - HEPA & vapor & gas (per pair), Add for personal protective equipment - Heavy duty, Contamination - pre & post test - full service (Bid Item)", Plastic bag - used for disposal of contaminated items, Tandem axle dump trailer - per load - including dump fees; Bathroom: Remove P-trap assembly - ABS (plastic), Remove Angle stop valve, Remove Plumbing fixture supply line, Remove Tile shower - 101 to 120 SF, Tub/shower faucet - Detach & reset, Bathtub or shower faucet (finish trim) - Detach & reset, Remove Tile base, Remove 1/2" Cement board, Tear out wet drywall, cleanup, bag - Cat 3, HEPA Vacuuming - Detailed - (PER SF), HEPA Vacuuming - Detailed - (PER SF), Apply anti-microbial agent to the walls and ceiling, Apply anti-microbial agent to the floor, Clean stud wall, Seal the surface area with fungicidal/bacterial inhibitor - one coat, Disinfect building - fog / spray - per SF, Toilet - Detach, Cabinet - vanity unit - Detach, Countertop - solid surface/granite - Detach, Sink - single basin - Detach, Detach & Reset Sink faucet - Bathroom, Bathtub - Detach, Remove Tile floor covering; LINEN CLOSET:HEPA Vacuuming - Detailed - (PER SF), HEPA Vacuuming - Detailed - (PER SF), Apply anti-microbial agent to the walls and ceiling, Apply anti-microbial agent to the floor, Disinfect building - fog / spray - per SF, Remove Tile floor covering
Upon receipt of the documentation from the Phoenix Restoration and AAA Mold Inspections Inc., the Insured forwarded same to the Insurance Company for approval and release of the insurance benefits she was entitled to under the Policy to mitigate her damages for the covered water loss. However, the Insurance Company refused to honor its contractual obligation to issue payment for these reasonable and necessary services. Despite providing the Insurance Company with all relevant information including the contact information for all involved with the emergency mitigation services, and/or necessary repairs, the Insurance Company failed to respond to the Insured’s correspondence or their request for cooperation to assist in mitigating their damages and restoring the Property. The failure to promptly communicate is a violation of 626.9541(1)(i)3c.
On August 29, 2024, without any explanation and in violation of Florida Statute Section 627.70131(6)(a) and (b), Mr. Horger on behalf of the Insurance Company sent written correspondence to the Insured inaccurately advising after the completion of its investigation it determined the claim presented was denied and did not qualify for payment. The Insurance Company’s correspondence failed to provide a detailed and specific explanation of its basis for why coverage was not afforded and what, if anything, contradicted the evidence and information provided by the Insured supporting fully payment under the Policy. Further the Insurance Company’s correspondence inaccurately withheld coverage based on vague policy provisions and facts which were inaccurate, inapplicable, and otherwise contrary to the evidence and documentation submitted by the Insured. Specifically, in its correspondence to the Insured, Castle Key advised in pertinent part the following regarding its reason for why it was unable to provide coverage:
We are unable to provide coverage for the requested damage because of the following provision in your policy which states:
Losses We Do Not Cover Under Coverages A
and C: We do not cover loss to property described in Building Property Protection-Coverage A or Personal Property Protection-Coverage C caused by or consisting of:
Page 10, 11, & 12 Paragraphs 7, 14 (A&B) 17 (A&B), & 19
7. The failure by any insured person to take all reasonable steps to save and preserve property when the property is endangered by a cause of loss we cover.
14. Vapors, fumes, acids, toxic chemicals, toxic gasses, toxic liquids, toxic solids, waste materials or other irritants, contaminants or pollutants. In addition, we do not cover loss consisting of or caused by any of the following:
a) wear and tear, aging, marring, scratching, deterioration, inherent vice and latent defect.
b) mechanical breakdown.
c) growth of trees, shrubs, plants or lawns whether or not such growth is above or below the surface of the ground.
d) rust or other corrosion.
e) contamination, including, but not limited to, the presence of toxic, noxious or hazardous gasses, chemicals, liquids, solids or other substances at the residence premises or in the air, land or water serving the residence premises.
f) smog, smoke from the manufacturing of any controlled substance, agricultural smudging and industrial operations.
g) settling, cracking, shrinking, bulging or expansion of pavements, patios, foundations, walls, floors, roofs
or ceilings.
h) insects, rodents, birds or domestic animals. We do cover the breakage of glass or safety glazing materials caused by birds.
i) seizure of covered property by government authority
17. Seepage, meaning continuous or repeated seepage or leakage over a period of weeks, months or years, of water, steam or fuel:
a) from a plumbing, heating, air conditioning or automatic fire protection system within the condominium or from within a domestic appliance; or
b) from within or around any plumbing fixtures, including, but not limited to, shower stalls, shower baths, tub installations or other fixtures designed for the use of water or steam.
19. Planning, construction or maintenance, meaning faulty, inadequate or defective:
a) planning, zoning, development, surveying, siting;
b) design, specifications, workmanship, repair, construction, renovation, remodeling, grading, compaction;
c) materials used in repair, construction, renovation or remodeling; or
d) maintenance;
of property whether on or off the residence premises by any person or organization.
After receiving the inaccurate and unjustified denial of her claim, Ms. Siegel hired the services of George England on 09/16/2024 to assist with reopening and challenging the Insurance Company’s initial coverage determination. Thereafter, George England, public adjuster from The People’s Choice Public Adjuster (“TPC”) inspected the Property, provided a comprehensive Xactimate repair/damage estimate, assisted the Insured in retaining various consultants/professionals to assess the cause and amount of damages and mitigation efforts needed. Following the Inspection of the Loss, George England produced a comprehensive Xactimate repair estimate totaling $22,251.94 (RCV) and $22,040.34 (ACV), that included but was not limited to: repairs to the Bathroom (including linen closet) to restore these areas back to pre-loss condition, as well as the aforementioned incurred costs for emergency mitigation efforts and other line items for general conditions, debris removal and other reasonable and necessary costs.
On September 16, 2024, TPC sent an letter via email to the Insurance Company providing a copy of their letter of representation and requested Castle Key to conduct a reinspection of the property. Additionally, in that letter TPC advised that if Castle Key "fail[ed] to make contact within 10 days...[it] would infer that [Castle Key] sand by your current coverage decision and The People's Choice will seek alternative remedy." In addition, TPC provided a second letter to Castle Key requesting the following items to be produced:
• Certified copy of insured’s policy to be mailed to our office
• Inclusion of our name as payee on all payments
• Payments be mailed to our office at the address above
• All correspondence, calls, questions, etc. should be addressed to The People's Choice Public Adjuster, listed above.
• Please be advised that the water mitigation may be in excess of the water mitigation special limits.
• Please ensure that all payments are accompanied by an adjuster’s estimate to facilitate mortgage company check endorsement for the insured.
Lastly, in that letter TPC also reminded Castle Key of its understanding of the following Florida Laws as it pertains to Insureds like Ms. Siegel: "Under Florida law, an insurance company has the following statutory obligations to its insureds: 1.To pay or deny a claim within 60 days after the insurance company receives notice of the claim. Fla. Stat. §627.7031; 2. To promptly settle the claim when the obligation to settle has become reasonably clear. Fla. Stat. §624.155(1)(b)(3).”
On September 19, 2024, AJA Parks (FL License # W668395) the desk adjuster assigned to the Loss, issued a letter to TPC advising of the Insured's right to attend mediation facilitated by the Department of Financial Services to settle any dispute regarding a claim with her insurer. On that same day Ms. Parks sent another letter to the TPC and the Insured advising that the Policy contained a mold exclusion and cited the following language that was allegedly in the Policy and applicable to the Insured's Loss:
"You should be aware that your policy contains an exclusion, which precludes coverage for losses consisting of or caused by mold. Your policy contains wording which states the following:
"Losses We Do Not Cover Under Coverages A and B: We do not cover loss to the property described in Dwelling Protection¬Coverage A or Other Structures Protection- Coverage B consisting of or caused Mold, fungus, wet rot, dry rot or bacteria. This includes any loss which, in whole by: or in part, arises out of, is aggravated by results from mold, fungus, wet rot, dry rot or bacteria. This exclusion applies regardless of whether mold, fungus, wet rot, or dry rot or bacteria arises from any other cause of loss, including, but not limited to, a loss involving water, water damage discharge, which may otherwise be covered by this policy, except as specifically provided in Section I Conditions, Mold,or Fungus, Wet Rot And Dry Rot Remediation As A Direct Result Of A Covered Water Loss"
Additionally, Ms. Parks goes on to misreprsent policy language and coverages by advising the Insured that the Policy "does provide for the payment of remediation costs up to a maximum of $10.00 for mold which results from a covered water loss...If we determine that any mold resulted from a covered water loss, this provision of your policy affords you a maximum of $10.00 for mold remediation." These assertions in the September 19, 2024 letter are violations of Florida Statute Sec. 626.9541(1)(i)(2) and Sec. 626.9541(1)(i)(3)(b).
Thereafter, the Insured’s representative(s) followed up with Castle Key to secure a response regarding the status of its investigation, following submission of the Xactimate repair estimate and documentation supporting coverage under the Policy, and the status of resolution of the claim for the outstanding insurance benefits it wrongfully withheld and failed to issue despite having evidence obliging it to do so under the Policy. After receiving zero response from the Insurance Company to amicably resolve the claim dispute, the Insured tried one last ditch attempt to amicably resolve the claim dispute, again to no avail, to the detriment of the Insured, and in violation of Florida Statute Section 626.9541(1)(i)(3)(c). The Insurance Company wrongfully withheld and failed to issue coverage despite having evidence obliging it to do so under the Policy.
Notwithstanding, on October 9, 2024, Gustavo Arzuaga (FL License #W75695), Claims Examiner from Castle Key sent a letter to the Insured advising it was "unable to provide coverage" on the same inaccurate basis as its initial coverage determination letter from August. Castle Key used the same form letter and cited the same policy provision despite having clear evidence from the Insured's public adjuster that the water loss was a sudden and accidental event due to the sudden water loss that occurred from the Insured's neighbor's unit located above her Property. As such, Castle Key failed to do any sort of proper investigation or review the evidence provided by the Insured and her public adjuster supporting full coverage under the Policy and took the easy way to usurp its obligations under the Policy by issuing a form "stand by" denial letter.
On 10/18/2024, the Insured’s public adjuster relayed and reiterated the Insured’s coverage dispute and demanded the Insurance company for payment in full as referenced in their Sworn Statement in Proof of Loss (“POL”) which complied with all enumerated policy requirements and delineated both the replacement cost and actual cash value of the loss and any additional damages owed to the Insured. The POL, in the amount of $17,096.74 represented the actual cash value of the claim after deduction of the $500.00 deductible as referenced in the comprehensive Xactimate Repair Estimate and supporting damages documentation. It should be noted that the Proof of Loss did not include the additional costs for Phoenix Restoration and AAA Mold Inspectors as the Insured demanded those vendors be paid directly. Notwithstanding, the Insurance Company was still on notice by the Insured via TPC to resolve the coverage dispute by overturning its wrongful denial and issue payment for at least the Actual Cash Value of the loss for $21,751.94.
Further, the Xactimate repair estimate provided to the Insurance Company by the Insured’s public adjuster and supporting damage documentation was explicitly contrary to any defenses/exclusions being asserted by the Insurance Company; however, this information was ignored by the Insurance Company solely to avoid payment on an otherwise clear-cut covered loss. In fact, the Insurance Company’s entire adjustment was designed to defraud the insured out of the insurance benefits due and owing under the subject policy per its customary business practices.
The Insurance Company violated section 624.155(1)(b)(1), Fla. Stat., 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 her interests and her protected class as a senior citizen in Florida. Specifically, the Insurance Company ignored covered damages to the Property and denied coverage for the claim. The Insurance Company retained outcome-oriented experts and claim professionals to manufacture an opinion that the damages were not covered by the Policy. Had the Insurance Company acted fairly and honestly toward the Insured and with due regard for its interests the Insurance Company would have attempted to settle the claim rather than issue the October 09, 2024 stand on denial coverage determination. The Insurance Company violated sections 626.9541(1)(i)(2) and 626.9541(1)(i)(3)(b), Fla. Stat., when it made material misrepresentations to the Insured that the Bathroom (including linen closet) at the Property was not damaged by plumbing failure or any other peril for which the policy afforded coverage and applied a mold exclusion that was inapplicable to the claim at hand. This material misrepresentation was made for the purpose and with the intent of settling the claim on less favorable terms than those provided in and contemplated by the Policy. In fact, the Insurance Company’s entire adjustment was designed to defraud the Insured out of the insurance benefits due and owing under the subject policy per its customary business practices.
The Insurance Company violated section 626.9541(1)(i)(3)(d), Fla. Stat., when it denied the claim without conducting a reasonable investigation based upon all available information. The Insurance Company failed to adequately consider the entirety of the information provided by the Insured and/or their representatives in support of coverage for 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). The Insurance Company had a duty to act in good faith and with due regard for the interests of the Insured but failed to do so.
The entire purpose of insurance is to indemnify the Insured of a covered loss. Despite the fact that the Insurance Company knows, or should know, that benefits are owed based upon the information provided by the Insured, to date, the Insurance Company has failed to issue any payment under the Policy, whether undisputed or otherwise. The Insurance Company’s delay in this matter is clearly against its Insured’s interests and only exacerbates the harm and hardship sustained by the Insured in connection with this loss. This is a violation of the Policy and Florida law, and if the Insurance Company handles all of its claims in accordance with the way it handled this claim, then this evidences a systematic practice of adjusting claims without due regard for the objective best interest of its Insureds. The Insured has complied with all requests made by the Insurance Company and provided all the information available to them with respect to the loss. Even though the Insured has complied with all other post loss obligations under the Policy, the Insurance Company continues to deny payment to the Insured that is due and owing under the Policy.
The Insurance Company’s conduct has been reckless and unfair to the Insured. The Insurance Company 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. The concept of insurance is that insurance is the insurer’s granting of timely and prompt indemnity or security against a contingent loss. Florida Statute §624.02 defines “insurance” as a contract whereby one undertakes to indemnify another or pay or allow specified amount or a determinable benefit upon determinable contingencies. Inherent is the fact that payment must be made timely and promptly so that the Insured may mitigate the damages and to put the Insured back into the position he/she was in prior to the loss as quickly as possible. The Insurance Company has breached this duty. The Insurance Company has refused and/or failed to tender any insurance proceeds to the Insured upon demand. The Insurance Company’s refusal and/or failure to settle the insurance claim, when under all circumstances it could have and should have done so had it acted fairly and honestly towards the Insured, is wrongful conduct. Furthermore, the Insured contends that the Insurance Company’s adjusters and/or representatives financially benefit by such wrongful conduct.
Moreover, it is clear from the above that the Insurance Company has failed to implement standards for the proper investigation of the claim to the detriment of the insured. As a result, the Insurance Company has violated the following sections of Florida Statutes:
§624.155(1)(b)(1) - Not attempting in good faith to settle claims when, under all circumstances, it could have and should have done so, had it acted fairly and honestly toward its Insured and with due regard.
§624.155(1)(b)(3) - 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.
§626.9541(1)(i)(2) - 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.
§626.9541(1)(i)(3)(a) - Failing to adopt and implement standards for the proper investigation of claims.
§626.9541(1)(i)(3)(b) - Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue.
§626.9541(1)(i)(3)(c) - Failing to acknowledge and act promptly upon communications with respect to claims.
§626.9541(1)(i)(3)(e) - 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.
§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.
§626.9541(1)(i)(3)(h) - Failing to clearly explain the nature of the requested information and the reasons why such information is necessary.
§626.9541(1)(i)(4) - Failing to pay undisputed amounts of partial or full benefits owed under first-party property insurance policies within 60 days after an insurer receives notice of a residential property insurance claim, determines the amounts of partial or full benefits, and agrees to coverage, unless payment of the undisputed benefits is prevented by an act of God, prevented by the impossibility of performance, or due to actions by the insured or claimant that constitute fraud, lack of cooperation, or intentional misrepresentation regarding the claim for which benefits are owed.
Additionally, through its actions/inactions, subject to the facts and circumstances understood at this time as outlined herein, the Insurance Company and their representatives have failed to comply with the following sections of Florida Administrative Code:
69B-220.201(3)(b) - An adjuster shall treat all claimants equally.
69B-220.201(3)(b)(1) - An adjuster shall not provide favored treatment to any claimant.
69B-220.201(3)(b)(2) - An adjuster shall adjust all claims strictly in accordance with the insurance contract.
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)(d) - An adjuster shall make truthful and unbiased reports of the facts after making a complete investigation.
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 without any compensation or remuneration to himself or herself except that to which he or she is legally entitled.
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.
69B-220.201(3)(j) - An adjuster shall not knowingly fail to advise a claimant of the claimant’s claim options in accordance with the terms and conditions of the insurance contract.
69B-220.201(3)(k) - An adjuster shall not undertake the adjustment of any claim concerning which the adjuster is not currently competent and knowledgeable as to the terms and conditions of the insurance coverage, or which otherwise exceeds the adjuster’s current expertise.
As a direct result of the Insurance Company 's actions, the insured have sustained irreparable harm. Upon information and belief, the aforementioned actions complained of herein, among others, are effectuated by the Insurance Company so often as to constitute a general business practice evidencing a motive to enhance the Insurance Company's profits and cause a detrimental effect to its policyholders. The Insurance Company clearly failed to adopt and implement standards for the proper investigations of claims. As a direct and proximate result of the Insurance Company's handling of the claim, the insured sustained extra-contractual damages, including, but not limited to, a public adjuster's fee and attorneys’ fees and costs. The Insurance Company's implemented claims programs and practices that were improper which directly resulted in additional losses to its insured. The Insurance Company, as part of its routine business pattern and practices, employs outcome-oriented adjusters/vendors/experts who purposely looked for ways to minimize coverage instead of affording coverage to its policyholders. In contrast to the legislative intent which motivated the enumeration of an insurance adjuster’s responsibilities outlined in the Florida Administrative Code, the insureds were not afforded the professional duties entrusted and imposed on the Insurance Company by the Public Trust. The outcome-oriented claim adjustment practices undertaken by the Insurance Company led to the Insurance Company's failure to adequately adjust the Claim. The Insurance Company, as a matter of its routine business practices, ignores correspondences, emails, letters, phone calls, voicemails, and the like from its insureds and/or their representatives. Any attempt to contact someone via email is impossible as the only email address utilized is a general claims email which is seemingly unmonitored and any attempt to contact someone via telephone results in extensive amounts of time navigating menus and assistants who transfer calls between departments until the phoneline either goes dead or a voicemail is reached. Even after leaving a voicemail, no return phone call or any other form of communication is received by the Insured in response in violation of §626.9541(1)(i)(3)(c).
The Insurance Company has purposely created an unnavigable labyrinth designed with the hopes of causing its insureds enough frustration that they ultimately cease to pursue their claims. Additionally, The Insurance Company sends correspondences requesting numerous overbroad categories of documents and the presentation of a sworn proof of loss. Said document requests do not contain any explanation as to why such information is necessary. Typically, said document requests are sent prior to the issuance of any payment by the Insurance Company so as to delay the issuance of the insureds' undisputed coverage proceeds or along with said payments despite no presentation of a discrepancy or need for reservation of rights. Regardless of the timeline in the claim in which the documents are requested and/or an insureds' level of compliance with the document and proof of loss request, the Insurance Company fails to take any further action and, instead, fails to acknowledge/act promptly upon all subsequent communications including, but not limited to, demands for coverage and payment. Based on the knowledge of the Insured’s counsel the bad faith behavior perpetrated by the Insurance Company occurs so frequently as to indicate a general business practice.
There is clear evidence in counsel's own files of willful, wanton, and malicious actions perpetrated by the Insurance Company in reckless disregard for the rights of its insureds. As such, it is clear that the Insurance Company’s repeated and generally utilized business practices violate Florida Statutes 624 and 626, as well as the Florida Administrative Code governing adjusters' ethical requirements, and the pattern and practice of de facto bad faith adjustment tactics can be established without the need for any further investigation of the Insurance Company’s claim files or file management system. In fact, the filing counsel has kept track of all the Insurance Company’s claims in which he has provided representation which include but are not limited to CRNs filed with The Department of Financial Services, in which substantially similar bad faith conduct has taken place. Such conduct occurs so frequently as to indicate a general business practice. The following is a non-exhaustive list of the files indicating same:
1) Shipley; Castle Key Claim #000756880886; CRN Filing #773505
2) Bhagwant; Castle Key Claim #0719630385; CRN Filing #722593
3) Mercado; Castle Key Claim #0670887769, CRN Filing #686898
4) U; Castle Key Claim #0681229950, CRN Filing #680780
5) Hayes; Castle Key Claim #0666155940, CRN Filing #635419
6) Stewart; Castle Key Claim #0651016172KJS, CRN Filing #635043
7) Englund; Castle Key Claim #070830337 PRO
Based on the above, it is clear that the Insurance Company must have a reason to act with such blatant disregard to policy, statute, rules, code, and procedure. The only possible motive an insurance company could have to act in such an egregious manner is that the Insurance Company is somehow benefiting financially through its bad faith actions. If a financial motive for acting in bad faith proves to be true, the Insurance Company, and, through the piercing of the Insurance Company’s corporate veil, its officers individually, should be monetarily sanctioned by all entities governing insurance in the State of Florida but also its license to write new insurance policies should be suspended until such a time as it has indemnified all outstanding claims.
Since the reporting of the claim, the Insurance Company failed to complete a thorough and unbiased evaluation of the damage, despite being provided substantial evidence and information from the Insured proving otherwise, and has failed to amicably resolve the loss. These failures have caused additional damages and financial harm to the Insured in direct violation of the governing policy between the Insured and the Insurer as mentioned herein. The entire adjustment of the claim was handled improperly and has resulted in additional stress, and damage to the Insured and the Property. It has now been 213 days since the loss was reported to the Insurance Company and the Insured is still left with a home in disrepair that has the potential to cause numerous safety hazards and harm to the elderly Insured and her family members.
The actions and inactions taken by the Insurance Company is evidence of the Insurance Company’s attempts to use the policy provisions to its advantage in violation of Florida Statute Section 626.9541(1)(i)(3)(b) and to limit its exposure in deliberately withholding adequate claim payments. There was no reason why the Insurance Company could not have overturned its coverage denial and tendered the full amount requested and owed to the Insured to repair their damages to their after receiving the documents submitted by their claim professionals and being put on notice of the claim dispute. Moreover, this is further evidence of Insurance Company’s violations of Florida Statutes 626.9541(1)(i)(3)(a), 626.9541(1)(i)(3)(b), 626.9541(1)(i)(3)(c), §626.9541(1)(i)(3)(d), 626.9541(1)(i)(3)(f), 626.9541(1)(i)(3)(i); Florida Statute, Section 624.155(b)(2); and Section 626.9531(1)(i)(3)(e).
The Florida Department of Financial Services cannot continue to allow this egregious behavior and meritless actions to delay the resolution of this claim by failing to communicate, conduct shoddy and repetitive inspections, and force the Insured to jump through unnecessary hoops to receive the insurance benefits rightfully owed to them due to the Insurance Company’s inability to investigate and handle claim disputes properly. Further, the Insured’s claim remains unresolved despite clear evidence to afford full coverage and the Insured’s strict compliance with the Policy and each and every one of the Insurance Company’s unreasonable requests. This is wholly unacceptable, and the Insurance Company cannot continue to sit back and enjoy the profits it continues to collect by engaging in the repeated business practices outlined in this Civil Remedy Notice. The Insured hereby requests the Florida Department of Financial Services to investigate the Insurance Company’s repeated business practices and take corrective measures to ensure additional consumers do not suffer and endure the additional stress and hardship they have and will continue to endure until this claim resolves.
In light of the foregoing, the Insured is concerned that the Insurance Company will stick to its pattern of intentional and unjustified delay of the conclusion of this claim in an effort to further drag out the investigation process; delay tendering payment in full and further prejudicing other insureds in the handling of their claims only for the sole purpose to deny claims by hiring biased experts and/or to limit an Insured’s recovery and profit by using the Policy to an Insured’s disadvantage (i.e., violating 626.9541(1)(i)(3)(i) - Unfair claim settlement practices).
The Insurance Company’s actions completely defeat the purpose of property and casualty insurance, as an insurance company should adequately compensate its insureds for covered losses properly at the outset of a claim, not after receiving hundreds of pages of documentation proving what was obvious and continuing to not even take the time to adequately review and exercising their own due diligence of the evidence provided by the Insured supporting full coverage for the covered loss.
This notice is given in order to perfect the right to pursue the civil remedy authorized by Section 624.155, Florida Statutes, should the Insurance Company fail to cure the violations set forth in this Civil Remedy Notice within the given cure period. There might be further wrongful conduct which has not yet been made known to the Insured at this time and the Insured reserves the right to amend this Notice as new information becomes available. 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 an insurance contract. It is the Insureds’ position that the Insurance Company engages in the practice of wrongfully delaying the claims investigation process, hiring biased experts/engineers/employees in evaluating insurance claims as a general business practice in a willful effort to increase profits and in reckless disregards for its Policyholder’s rights. This is wrongful conduct. To cure the defects outlined in this civil remedy notice, the Insurance Company must:
(1) Create and implement adequate guidelines for proper investigation and evaluation as to claims handling and for the training and supervision of employees including adjusters, which will avoid future statutory violations as set forth above. Specifically, subject its claims representatives/adjusters to additional educational training as to the governing statutes and ethical codes that she is to adhere to while investigating a loss like the one at hand.
(2) Create and implement adequate guidelines for the proper investigation and evaluation of plumbing failure losses, and for the training and supervision of employees, including independent, with regard to said claims, to ensure that the Insurance Company’s claim handling procedures with regard to these types of losses are adequate to stop further insureds from being treated unfairly and wrongfully.
(3) The Insurance Company must act fairly and honestly toward the Insured and with due regard to their interest in attempting to resolve the Insured’s claim and if this matter continues to remains unresolved and litigation is initiated, The Insurance Company’s legal counsel should refrain from filing frivolous motions, conducting unnecessary field inspections, delay the discovery process, attend mediation in bad faith with insufficient authority to resolve the entire claim dispute and other brazen defense tactics to only further drag out the lawsuit to the Insured’s disadvantage per its repeated business practices.
(4) The Insurance Company must keep the claim open for the adjustment of any supplemental claim and payment of damages at Replacement Cost Value (RCV) as incurred and any additional unincurred costs to return the Property/Insured to pre-loss condition.
(5) The Insurance Company must immediately tender all insurance proceeds due and owing to the Insured for the fair value of the Claim which are fairly owed under the insurance policy that would reasonably place the Insured back to pre-loss condition, additional damages owed under the Policy, any statutory interest owed, public adjusting fees, attorney’s fees and costs as follows:
(a) $21,540.34 at Actual Cash Value, and the reimbursement of $211.60 in Recoverable Depreciation (once all repairs are incurred) which reflects the remaining amount of insurance benefits owed to return the Insured and their Property to pre-loss condition per the Xactimate Repair Estimate, POL, and supporting documents previously provided to the Insurance Company. The Insured further demands the Insurance Company for payment of any additional damages at Replacement Cost Value as incurred at a future date in the event the subject claim is not amicably resolved within the next 60 days.
(b) $1,186.50 for statutory interest on the outstanding payment of $21,540.34 referenced above pursuant to Florida Statute Section 627.70131 due to the 213 days this claim has remained unresolved following the reporting of the loss by the Insured, which will only increase as this claim remains open; and
(c) Resolve and pay any claim in full by any third party under an Assignment of Insurance Benefits for its reasonable and necessary services rendered on behalf of the Insured.
(d) $10,000.00 in reasonable amount of attorney’s fees to Legal Grit PLLC for their legal representation of the Insured pursuant to Florida Statute Section 627.428; and/or 627.70152.
As such, the Insured hereby requests the Insurance Company to issue payments as reflected in Section 5 as referenced above before the expiration of the 60-day cure period. If the Insurance Company disagrees with the extent of the cure requested or asserts that the payment of any of the above cure categories may not be required, it should cure to the extent it believes it must under the Subject Policy and governing laws to correct the allegations of bad faith contained herein. However, per the Insurance Company’s standard business practices, it will not attempt to amicably resolve this claim despite its obligation to do so as referenced previously in this Notice, and the Insured will wait to receive the Insurance Company’s standard form letter from its defense counsel further delaying the resolution of this matter by alleging this CRN does not contain enough facts, policy information and what is specifically requested of the Insurer to cure the defects alleged herein which is wholly accurate. Notwithstanding, the Insured still hopes the claim can be resolved amicably and without the need for extensive litigation. However, the Insurance Company’s failure to cure the defects as described herein will result in additional extra-contractual damages and civil litigation outside of the pending action for breach of contract. While it is not being requested as a cure for the bad faith alleged herein, the Insured is willing to entertain any reasonable counteroffer of settlement.
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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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