Civil Remedy Notice of Insurer Violations
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Filing Number:     803086
Filing Accepted:  1/23/2025
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Complainant
Last/Business Name *  
ANGEL MELENDEZ MATOS AND KARLA VARGAS VELEZ   First Name  
Street Address * 101 TANGERINE COURT
City, State Zip * KISSIMMEE, FL 34743
Email Address * CLAY@THEKRFIRM.COM
Complainant Type: * Insured
Insured
Last/Business Name*   ANGEL MELENDEZ MATOS AND KARLA VARGAS VELEZ   First Name  
Policy # * 2MR114676901 Claim #* 00201680424
Attorney
Attorney is Applicable
Last Name* KUHN First Name * CLAYTON Initial
Street Address* 2110 WEST PLATT STREET
City, State Zip* TAMPA , FLORIDA 33606
Email Address * CLAY@THEKRFIRM.COM
Violation
Insurer Type *   Authorized Insurer Unauthorized Insurer
 
Insurer Name*   AMERICAN SECURITY INSURANCE COMPANY
NAIC Company Code 42978
 
Name of individual responsible for violation (if any):* ANY AND ALL PERSONS ASSOCIATED WITH THE CLAIMS HANDLING FROM AMERICAN SECURITY INSURANCE COMPANY
Type of Insurance * Residential Property & Casualty   
Reason for Notice *
Unsatisfactory Settlement Offer
Unfair Trade Practice
* Statutory provision(s) which the insurer allegedly violated.
 
624.155(1)(b)(1) Not attempting in good faith to settle claims when, under all the circumstances, it could and should have done so, had it acted fairly and honestly toward its insured and with due regard for her or his interests.
626.9541(1)(i)(3)(a) Failing to adopt and implement standards for the proper investigation of claims.
626.9541(1)(i)(3)(b) Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue.
626.9541(1)(i)(3)(d) Denying claims without conducting reasonable investigations based upon available information.
* Specific policy language that is relevant to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

THE POLICY LANGUAGE RELEVANT TO THE VIOLATIONS INCLUDES ALL APPLICABLE LOSS PAYMENT AND COVERAGE PROVISIONS OF POLICY NUMBER 2MR114676901 INCLUDING THE DECLARATIONS PAGE AND ALL ENDORSEMENTS TO THE POLICY, WITH RESPECT TO COVERAGES A, B, C, AND D. ADDITIONALLY, ANY SECTIONS RELIED UPON BY THE INSURER IN ITS DENIAL TO FULLY PAY THE CLAIM, INCLUDING THE DUTIES IN THE EVENT OF LOSS PROVISIONS AND THE POLICY'S EXCLUSION OF COVERAGE PROVISIONS.
 
* Facts and circumstances giving rise to the violation.
Enter all words or phrases (one at a time) that should be used to filter.

Angel Melendez Matos and Karla Vargas Velez (hereinafter “Insureds”) are homeowners insured with an all-risks policy issued by American Security Insurance Company (hereinafter “Carrier”). On or about July 13, 2023, Insureds’ home located at 101 Tangerine Court, Kissimmee, Florida 34743 sustained significant damage as a result of a tree. Specifically, a tree fell into Insureds’ property and created multiple openings to the roof of Insureds’ property. This resulted in interior damage to various areas of the interior of Insureds’ property including but not limited to, master bedroom, closet, bathroom, and shower. The Loss is covered under Insureds’ policy issued by Carrier. The Insureds mitigated damages by contacting Loss Restorations LLC who performed mitigation services on the subject property. All of the relevant documents were provided to Carrier. Insureds promptly reported the claim and fully cooperated with all requests for inspections. Carrier assigned Claim No. 00201680424 to the loss. The Insureds have fully cooperated with Carrier’s investigation of the claim, including providing all requested documentation and complying with all post-loss policy conditions. Specifically, the Insureds, with assistance from their public adjuster, submitted an estimate for $22,848.84, which was a fair and reasonable assessment for the repair/replacement of damages. Carrier failed to retain qualified experts necessary to identify the repairs necessary to restore the property to its pre-loss condition. Despite Insureds providing Carrier with a detailed estimate, Carrier failed to pay Insureds the amount necessary to repair/replace the damaged property, less the applicable deductible. Instead, Carrier gave Insureds a lowball estimate that failed to encompass all covered damages. The carrier only offered to pay for the roof, a gross underpayment for all the damage associated with this claim. This has become a common business practice for Carrier. Under the circumstances surrounding this claim, had Carrier acted fairly and honestly toward the Insureds and with due regard for the Insureds’ interests, Carrier could and should have attempted in good faith to settle this claim. Carrier did not and, instead, dishonestly, and unfairly placed its own interests well ahead of those of the Insureds. In doing so, Carrier violated Section 624.155(1)(b)(1), Florida Statutes. Carrier’s use of unqualified and biased adjusters, and failure to retain experts necessary to identify the repairs necessary to restore the property to its pre-loss condition, evidence Carrier’s failure to adopt and implement standards for the proper investigation of claims in violation of Section 626.9541(1)(i)(3)(a), Florida Statutes. Carrier’s use of unqualified and biased adjusters, and failure to retain experts necessary to identify the repairs necessary to restore the property to its pre-loss condition, evidence Carrier’s failure to conduct a reasonable investigation based upon available information. In denying full coverage for this claim without conducting reasonable investigations based upon available information, Carrier has violated Section 626.9541(1)(i)(3)(d), Florida Statutes. By representing to Insureds that the Policy does not afford full coverage for this loss, Carrier is misrepresenting pertinent facts and/or insurance policy provisions relating to coverages at issue, in violation of Section 626.9541(1)(i)(3)(b), Florida Statutes. When applying the facts present here to Florida law, it is clear that Carrier is acting in bad faith. Florida Statute § 624.02 defines insurance as a contract whereby one undertakes to indemnify another or pay or allow a specified amount or a determinable benefit based on determinable contingencies. Inherent is the fact that payment must be made timely and promptly so that insureds may mitigate their damages and be put back into the position they were in prior to the loss as quickly as possible. Carrier has breached this duty by refusing to properly and timely adjust the loss. Moreover, Section 69B-220.201 of the Florida Administrative Code defines Carrier’s adjusters conduct here as an unfair claims settlement practice. Specifically, Section 69B-220.201(3) provides that “[a]n adjuster shall not approach investigations, adjustments, and settlements in a manner prejudicial to the insured” and that “[a]n adjuster shall make truthful and unbiased reports of the facts after making a complete investigation.” As detailed above, Carrier’s investigation and adjustment of this claim was done in a manner prejudicial to Insureds, was incomplete, and lacked truthful and unbiased reports of the facts. Carrier has more than enough information and is still refusing to accept coverage for the Insureds’ claim. This continued and repeated reckless claim delay and denial of coverage will result in a significant punitive damage award if a bad faith lawsuit is filed. Carrier can cure the defects outlined in this Civil Remedy Notice and avoid a lawsuit for bad faith by immediately accepting full coverage under the subject insurance policy for this claim and by paying Insured’s estimate of $22,848.84, less applicable deductible, which is the reasonable amount of the covered loss pursuant to the policy. A copy of this form has been submitted to the Florida Department of Financial Services who has transmitted the same to the following parties providing them notice of the filing of this Civil Remedy Notice: American Security Insurance Company.
Comments
User Id Date Added Comment
david.terry@thekrfirm.com 06-04-2026 The parties have settled this matter.
brian.koch@hklaw.com 03-28-2025 VIA UPLOAD onto DFS website Florida Department of Financial Services Division of Insurance Regulation Consumer Assistance / Civil Remedy Section Larson Building, 200 East Gaines Street Tallahassee, Florida 32399-0322 Re: CIVIL REMEDY NOTICE OF INSURER VIOLATION DOI File No.: 803086 Complainant: Angel Melendez Matos and Karla Vargas Velez Claim No.: 00201680424 Filed by: Clayton Kuhn, Esq. Reported DOL: July 13, 2023 Dear Sir or Madam: American Security Insurance Company (“American Security”) received the Civil Remedy Notice of Insurer Violation (“CRN”) submitted by attorney Clayton Kuhn, Esq., on behalf of Angel Melendez Matos and Karla Vargas Velez (“Complainants”), that was accepted by the Department of Financial Services (the “Department”). This matter relates to a claim for damages resulting from a fallen tree to which American Security assigned claim number 00201680424 (the “Claim”), which was reported under a lender-placed certificate bearing certificate number 2MR07441146769 (the “Certificate”) issued by American Security to Lakeview Loan Servicing, LLC its successors and/or assigns (the “Lender”) as the “Named Insured” and Angel Melendez Matos as the “Borrower” that insured the dwelling located at 101 Tangerine Court, Kissimmee, Florida, 34743 (the “Property”), as more fully set forth therein, from November 2, 2022 through November 2, 2023. As a general matter, American Security objects to the validity of the CRN, as it is deficient on its face. The CRN lacks the specificity required by s. 624.155(3)(a), Florida Statutes. The CRN provides nothing more than vague, ambiguous and conclusory allegations regarding what Complainants believe to be American Security’s motivations, positions and business practices – none of which are true or supported by any facts. Florida law is clear that a claimant is required to state with specificity the “facts and circumstances giving rise to the violation,” to allow the insurer to understand and cure any purported violation. Longpoint Condo. Assn. v. Allstate Ins. Co., 2005 WL 1315810 (N.D. Fla. 2005). A written CRN which is vague and “shotgun” in nature or is written in general terms fails the specificity requirement of the statute. See Heritage Corp. of South Fla. v. National Union Fire Ins. Co. of Pittsburgh, P.A., 580 F. Supp. 2d 1294, 1300 (S.D. Fla. 2008); Rousso v. Liberty Surplus Ins. Corp., 2010 WL 7367059 (S.D. Fla. 2010); Valenti v. Unum Life Ins. Co. of America, 2006 WL 1627276 (M.D. Fla. 2006). The very purpose of the civil remedy notice, pursuant to Chapter 624, is to inform the insurer of alleged violations with specific information to encourage settlement of the subject claim. “The sixty-day window [as provided for in F.S. §624.155] is designed to be a cure period that will encourage payment of the underlying claim, and avoid unnecessary bad faith litigation.” Talat Enters., Inc. v. Aetna Cas. & Sur. Co., 753 So. 2d 1278 (Fla. 2000). Notice sent to the Department of Insurance concerning settlement violation(s) is intended to serve as a basis for the Department to assist in the settling of claims and to monitor the insurance industry. Id. However, whenever a complainant provides little in the way of adequate notice, the statutory intent of the CRN is frustrated. On July 13, 2023, Complainants reported damage to the roof of the Property from a fallen tree that purportedly occurred that same day. American Security acknowledged the Claim in writing the following day and assigned claim number 00201680424 to the Claim. Upon receiving notice of the Claim, American Security conducted an inspection of the Property by an independent adjuster, which took place on July 25, 2023. The inspection revealed that there was damage to the roof, exterior and interior from the fallen tree. On July 26, 2023, American Security extended coverage in the amount of $29,980.94 Replacement Cost Value (“RCV”) which, after application of the $2,000.00 deductible and $13,362.53 in recoverable depreciation, resulted in payment to the Complainants in the amount of $14,618.41. American Security set forth the coverage determination in written correspondence and provided Complainants with a copy of the corresponding estimate. Following American Security’s initial coverage determination, Complainants contacted American Security to advise of additional damages. However, at no point did Complainants submit documentation disputing the amount of covered loss or showing that repairs had been completed or that additional amounts were needed to complete repairs warranting the release of recoverable depreciation. Nonetheless, on December 4, 2023, American Security made payment to Complainants for the recoverable depreciation in the amount of $13,362.53 Upon Complainants’ request for a reinspection of the Property, American Security conducted a second inspection of the Property on January 3, 2024, and based on the results of same, made a supplemental coverage determination, which resulted in an additional payment to Complainants in the amount of $1,956.51. On February 2, 2024, Complainants’ Public Adjuster submitted its Letter of Representation for the Claim and requested a reinspection of the Property. On April 24, 2024, the Public Adjuster an invoice from Loss Restorations for mitigation services performed in relation to the Claim. American Security issued payment to Loss Restoration for an amount agreed to by the parties. On May 7, 2024, submitted an estimate of purported damages for the Claim in the amount of $22,848.84. Notably, the repairs listed in the estimate are completely unrelated to the Claim. More significantly, to date, American Security has paid Complainants a total amount of $29,937.45 for the Claim – an amount that exceeds the amount claimed by Complainants by over $7,000.00. Notwithstanding that American Security has issued payment for an amount greater than the amount claimed by Complainants for the Claim, Complainants filed a Property Insurance Notice of Intent to Initiate Litigation (“Notice”) and the instant Civil Remedy Notice on January 23, 2025 – both listing $22,849.00 as the amount of damages. At no time prior to the filing of the Notice and CRN did Complainants and/or their representatives advise American Security of damages exceeding American Security’s payment for the Claim. Despite American Security’s good faith investigation of the Claim, the Complainants list “Unsatisfactory Settlement Offer” and “Unfair Trade Practice” as the reasons the CRN was submitted. However, these allegations are inaccurate and/or completely devoid of facts – which further reflects the boilerplate nature of the allegations being asserted against American Security. Nevertheless, American Security responds to the allegations by stating that they are without basis as the Claim was investigated and a coverage determination was made in accordance with the terms, conditions and exclusions of the Certificate. Moreover, Complainants cite statutory provisions under Fla. Stat. § 624.155 and Fla. Stat. § 626.9541, without any ultimate facts that support the empty and false accusations. As such, American Security rejects the same as vague and statutorily non-compliant, and further responds as follows: 624.155(1)(b)(1): Denied. American Security conducted a thorough investigation of the Claim and extended coverage for the amount of covered loss in accordance with the results of its investigation and the terms, conditions and exclusions of the Certificate. In so doing, American Security has acted fairly and honestly toward Complainants with due regard for her interests. The Complainants have provided absolutely no facts or circumstances supporting this allegation in the CRN. 626.9541(1)(i)(3)(a): Denied. American Security has never failed to adopt and implement standards in such a way that would constitute a business practice. To the contrary, American Security conducted a thorough investigation and extended coverage for the amount of covered loss in accordance with the terms, conditions and exclusions of the Certificate. Complainants have provided absolutely no facts or circumstances supporting this allegation in the CRN. 626.9541(1)(i)(3)(b): Denied. American Security has never misrepresented facts or insurance policy provisions relating to the coverage at issue to Complainants. The Complainants have provided absolutely no facts or circumstances supporting this allegation in the CRN. 626.9541(1)(i)(3)(d): Denied. American Security has not denied the Claim without first conducting a reasonable investigation based upon available information. To the contrary, American Security conducted a thorough investigation of the Claim and extended coverage for the amount of covered loss in accordance with terms, conditions and exclusions of the Certificate. Absolutely no facts or circumstances supporting this allegation have been provided by Complainants in the CRN. Complainants also cite Section 69B-220.201 of the Ethical Requirements for All Adjusters and Public Adjuster Apprentices as listed in the Florida Administrative Code but fail to provide any facts or circumstances in support of same. Rather, Complainants inaccurately allege that American Security failed to accept coverage for the Claim. As set forth above, American Security extended coverage for the Claim for the amount of covered loss in accordance with terms, conditions and exclusions of the Certificate. American Security denies any attempted allegation of bad faith conduct in relation to the cited provision of the Florida Administrative Code. Finally, Complainants fail to list a valid cure for the alleged bad faith conduct. Complainants list $22,848.84 “less applicable deductible” as the “reasonable amount of the covered loss” and the amount of payment that is sought to cure the CRN. American Security has paid $29,937.45 and accordingly, there is no further action available to American Security to remedy Complainants’ allegations as stated. American Security provided copies of all of the payments to Complainants, and the response has been radio silence. American Security denies all the allegations in the CRN as false, unfounded and completely devoid of merit or factual predicate. At no time has American Security ever acted in bad faith. At all times material to this Claim, American Security: (a) acted in good faith to investigate the Claim, acted fairly and honestly in its dealings with the Complainants and their representatives; (b) promptly investigated the Complainants’ Claim; (c) acknowledged and acted promptly in response to all communications with the Complainant; and (d) complied with its obligations in accordance with the terms of the subject insurance contract and Florida law. If you are in need of or seek any further information, please feel free to contact the undersigned. Very truly yours, /s/ Brian H. Koch cc: Clayton Kuhn, Esq. Andrea Aguilar, Esq.
Acknowledgement
* The submitter hereby states that this notice is given in order to perfect the rights of the person(s) damaged to pursue civil remedies authorized by Section 624.155, Florida Statutes.

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DFS-10-363
Rev. 10/14/2008