Filing Number: 803999
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| Filing Accepted: 1/29/2025 |
| Last/Business Name
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CONSOLIDATED BURGER HOLDINGS, LLC
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First Name |
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| Street Address
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225 MAIN STREET STE 3 |
| City, State Zip
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DESTIN,
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32541
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| Email Address
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DMCCLAIN@BK-FL.COM |
| Complainant Type:
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Insured |
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| Last/Business Name* |
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CONSOLIDATED BURGER HOLDINGS, LLC |
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First Name |
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| Policy # * |
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8E-A3-PP-0000098-00 |
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Claim #* |
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KY21K2090748 |
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Attorney is Applicable
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| Last Name* |
HARRIS
First Name *
WILLIAM
Initial
C
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| Street Address* |
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777 S. HARBOUR ISLAND BLVD 950 |
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TAMPA
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FL
33602
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| Email Address * |
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CHARRIS@MERLINLAWGROUP.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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PRINCETON EXCESS AND SURPLUS LINES INSURANCE COMPANY
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| Insurer Name* |
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| Street Address* |
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,
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NAIC Company Code 10786 |
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| Name of individual responsible for violation (if any):*
MARK TATE
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| Type of Insurance
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Commercial Property & Casualty
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| Reason for Notice
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Claim Delay
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Unsatisfactory Settlement Offer
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Unfair Trade Practice
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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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| 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)(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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Specific policy language that is relevant to the violation.
Enter all words or phrases (one at a time) that should be used to filter.
A. PERILS INSURED: The Company will pay for direct physical loss or damage occurring during the Policy Period to the property described in COVERED PROPERTY below at an Insured Location (hereinafter, “Covered Property”) within the Coverage Territory, directly caused by or resulting from any Covered Cause of Loss and not otherwise excluded herein; provided that, prior to the beginning of the Policy Period, no Insured knew or reasonably should have known that such loss or damage had occurred, in whole or part. If any Insured knew or reasonably should have known that such loss or damage occurred in whole or in part at the time the Policy Period begins, then any continuation, change or resumption of such loss or damage during or after the Policy Period will be deemed to have been known prior to the Policy Period, and will not be covered under this Policy.
SECTION VIII – DEFINITIONS A. POLICY DEFNITIONS: The following terms have the following meanings under this Policy:
6. “Covered Cause of Loss” means any cause of loss or damage not excluded by this Policy.
B. PERILS EXCLUDED: The following exclusions apply to all Coverages under section II – COVERED CAUSES OF LOSS unless specifically stated elsewhere in this Policy.
1. This Policy excludes any:
a. indirect or remote loss or damage.
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l. loss, damage, cost, or expense resulting from the presence, growth, proliferation, spread or any activity of Fungus, wet or dry rot or bacteria, except as covered under FUNGUS, WET ROT, DRY ROT OR MOSS.
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3. This Policy excludes the following, but, if physical damage not otherwise excluded by this Policy results, then only that resulting damage is insured: a. loss, damage, cost, or expense resulting from the faulty, inadequate, or defective workmanship, repair, renovation, grading, compaction, maintenance, construction, installation, or design of any property on or off an Insured Location, and the material used or installed in the course thereof. For purposes of this provision, “design” shall include but not be limited to designing, planning, zoning, development, surveying, and siting.
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c. loss, damage, cost or expense resulting from deterioration, depletion, rust, corrosion, erosion, decay, evaporation, wear and tear, marring or scratching, leakage, inherent vice or latent defect, or any quality in or of property which causes it to damage or destroy itself.
E. ORDINANCE OR LAW
1. This Policy covers the reasonable and necessary costs, described in sub-paragraph 2. below, incurred to satisfy the minimum requirements of the enforcement of any law or ordinance regulating the demolition, construction or repair of buildings, or establishing zoning or land use requirements at an Insured Location, provided that:
a. such law or ordinance is in force on the date of insured physical loss or damage; and
b. such law or ordinance’s enforcement is a direct result of physical loss or damage that is covered under this policy; and
c. such property is repaired or replaced within two years from date of loss.
This Additional Coverage does not cover loss due to any law or ordinance with which the Insured was required to comply had the loss not occurred, including costs incurred in following recommended actions or standards that exceed actual requirements of any ordinance or law.
BB. INCREASED COST OF CONSTRUCTION DUE TO FRANCHISE SPECIFICATIONS
In the event of loss or damage to Covered Property that is the subject of a written franchise agreement between a franchisor and the Insured, as franchisee, executed prior to the date of loss or damage, the Company will pay the additional cost to repair, replace, restore or rebuild the franchise location décor and equipment, including signage, in accordance with the specifications applicable to such property mandated by such franchise agreement as of the date of loss or damage. This Additional Coverage does not apply to any property that is in storage or otherwise not in use for purposes of the business conducted pursuant to the franchise agreement at the time of loss or damage.
This Additional Coverage does not apply to the extent coverage is provided elsewhere under this Policy.
The most the Company will pay in any one Occurrence under this Additional Coverage is the sub-limit of liability for Increased Cost of Construction Due To Franchise Specifications shown in the Sub-Limit Provision endorsement attached to this Policy. This sub-limit of liability is part of, and not in addition to, the Occurrence Limit of Liability shown in the Declarations.
C. APPRAISAL
If the Company and the Insured disagree on the value of the property or the amount of loss, within sixty (60) days after receipt of proof of loss by the Company, either may make written demand for an appraisal of the loss. In this event, each party will select a competent and impartial appraiser. The two appraisers will then select an umpire. If they cannot agree on an umpire after fifteen (15) days, either may request that selection be made by a judge of a court having jurisdiction. The appraisers will state separately the value of the Covered Property and amount of loss. If they fail to agree, they will submit their differences to the umpire. A decision agreed to by any two will be binding. Each party will pay its chosen appraiser and its own costs and expenses; and bear the other expenses of the appraisal and umpire equally.
If there is an appraisal, the Company will still retain its right to deny the claim.
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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.
In Florida, the work of adjusting insurance claims engages the public trust. PRINCETON EXCESS AND SURPLUS LINES INSURANCE COMPANY (“PRINCETON”) has breached this duty by its adjustment of the policyholder’s claim of loss.
PRINCETON has failed to create and implement adequate guidelines for proper investigation and evaluation of claims and for training and supervision of employees resulting in statutory violations as set forth herein. PRINCETON has failed and/or refused to thoroughly, accurately, and completely investigate and evaluate the policyholder’s insurance claim for damages based on all information available and has instead ignored relevant and obvious information that evidences that additional payment is required under the policy.
Notwithstanding the timely notification of the insurance claim, PRINCETON has delayed and/or refused to tender to the policyholder all insurance proceeds due and owing under the insurance policy in a timely manner.
To date, notwithstanding the policyholder’s pleas otherwise, PRINCETON has continued to refuse to acknowledge its obligation to tender all monies due and owing or assist the policyholder in the mitigation of their damages.
The policyholder is Consolidated Burger Holdings, LLC whose property was damaged as the result of a fire on or about January 21, 2021. Damages resulting from the fire and ensuing water losses are undisputedly covered under the relevant insurance policy.
The policyholder timely notified PRINCETON of the damages and opened a claim pursuant to the terms and conditions of the insurance policy.
In response to the claim for benefits, PRINCETON sent an adjuster and representative, Mark Tate, to investigate and adjust the loss.
From the outset the adjustment was cursory and outcome oriented. Despite the fact that there was significant fire, smoke, and ensuing water damages, PRINCETON’s adjuster, consultants, and representatives engaged in a concerted effort to find ways to minimize the claim. For instance, instead of promptly and properly adjusting the fire and ensuing damages, PRINCETON’s representatives became almost solely focused on finding ways to argue that the obvious damages were caused by everything from wear and tear to rot.
Consolidated Burger Holdings did everything it could to work with PRINCETON and its representatives. Consolidated Burger Holdings spend countless hours on phone calls, attending meetings (both in person and virtual) trying to get PRINCETON to simply pay what was owed on the claim. When PRINCETON requested voluminous amounts of documentation, Consolidated Burger Holdings complied with each of these requests and provided all information in its possession.
PRINCETON was undeterred, however, and continued in its singular mission to avoid paying the claim. Many of the meetings and calls turned hostile due to the conduct of PRINCETON’s representatives. Further, PRINCETON continually alleged that it had not received documentation and information that had already been provided.
While PRINCETON admitted coverage and made some payments on the claim, these amounts were minimal compared to the undisputed amounts Consolidated Burger Holdings had spent to repair the building and the amounts lost due to business interruption.
Consolidated Burger Holdings continued in its attempts to resolve the claim and retained counsel to assist in this endeavor. Unfortunately, PRINCETON continued to refuse to acknowledge the information and documentation provided forcing Consolidated Burger Holdings to once again produce the information which was already in PRINCETON ’s possession.
On multiple occasions throughout the claim Consolidated Burger Holdings provided information and explanation showing that significantly more money was owed for structure damages, equipment and furnishing damages, franchise upgrades, and business interruption. PRINCETON and its agents/representatives continually ignored this information choosing instead to feign ignorance in order to delay and/or avoid paying the amounts owed under the policy.
Consolidated Burger Holdings even attempted to invoke the appraisal provision in the policy to resolve the dispute amicably. PRINCETON, however, refused to comply with the appraisal provision by misrepresenting the factual and legal posture of the matter and demanding Consolidated Burger Holdings jump through even more unnecessary hoops to explain why the policy clearly covered the amounts claimed.
Finally, more than 3 years after the loss, PRINCETON finally advised that it agreed that there were significant additional amounts owed under the policy. Unfortunately, PRINCETON still made absolutely no additional payments. Instead, PRINCETON continued to delay the matter and ultimately invoked the appraisal process itself without even telling its policyholder what its final amount of loss was or paying the undisputed amounts owed. This is a direct violation of the policy and Florida law.
Since the beginning of the claim, PRINCETON has engaged in a pattern of delay and denial that has harmed its policyholder. PRINCETON has not settled the claim when it could and should have done so had it acted fairly and honestly and has failed to take into account the information and evidence that clearly shows/ed additional payment is owed.
PRINCETON has misrepresented pertinent facts and insurance policy provisions and has continually failed to provide a reasonable explanation of the facts and circumstances supporting its refusal to pay and/or settle the claim. These misrepresentations include, but are not limited to, that the policy did not cover the additional amounts claimed, that appraisal was not appropriate when invoked by Consolidated Burger Holdings, and that appraisal was appropriate when PRINCETON had refused to calculate the undisputed amounts owed.
PRINCETON has also failed to respond timely and appropriately to communications from its policyholder. As noted above, PRINCETON was repeatedly provided with information and documentation showing additional amounts were owed. PRINCETON ignored this information and instead continued to feign ignorance to avoid paying what was owed.
PRINCETON has refused to pay the policyholder’s claim without conducting a reasonable investigation based upon all available information. Specifically, PRINCETON ignored the information continually provided by the insured and then invoked appraisal itself without even determining the undisputed amounts owed.
PRINCETON has failed to promptly provide the policyholder with a reasonable written explanation as to why it continues to delay and refuse to issue full payment on the claim. This is especially true as it relates to why it has compelled the insured to participate in the appraisal process without first paying even the undisputed amounts owed.
The actions and violations noted above were either done intentionally or as the result of PRINCETON’s failure to adopt and implement the proper standards for the investigation and adjustment of claims.
Overall, PRINCETON’s investigation and handling of the claim was inadequate and contrary to its obligations under the insurance policy and Florida law.
The policyholder has done everything legally requested by PRINCETON to date. To cure the violations set forth in this Civil Remedy Notice, PRINCETON must now agree to acknowledge its duties and obligations under the law in adjusting its policyholder’s claim, and tender rightfully owed insurance benefits to return the policyholder to their pre-loss condition.
The concept of insurance is that insurance is the insurer’s granting of timely and prompt indemnity or security against a contingent loss. Florida law 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 policyholder may mitigate his/her damages and to put him/her back into the position they were in prior to the loss as quickly as possible. PRINCETON breached this duty.
The policyholder was and still is forced to expend monies to submit the insurance claim, e.g., retaining experts, and legal counsel, to force PRINCETON to honor its obligations under the insurance policy and to pay all the insurance proceeds due and owing the policyholder.
PRINCETON has refused and/or failed to tender all insurance proceeds to the policyholder upon demand. PRINCETON 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 policyholder is wrongful conduct. The policyholder contends that PRINCETON has financially benefited from its improper withholding of due and owing insurance proceeds by profiting from the “float”. Furthermore, the policyholder contends that PRINCETON and/or its representatives financially benefit from such unfair trade practices as a part of their general business practices. The policyholder contends that PRINCETON pressures its agents and/or representatives, through financial incentives, to look for reasons to underpay or deny claims instead of fulfilling their obligations to do the opposite as a general business practice.
This notice is given in order to perfect the right to pursue the civil remedy authorized by Florida Statutes, including any and all bad faith/extra contractual damages, should PRINCETON fail to cure the violations set forth in this Civil Remedy Notice within the given cure period. The policyholder also intends to seek punitive damages against PRINCETON as it appears that PRINCETON’s violations occur with such frequency as to evidence a general business practice and the violations were willful, wanton and malicious and in reckless disregard for the rights of its insureds.
While no specific “cure amount” is required for this Civil Remedy Notice to be valid, the policyholder will consider the allegations contained herein “cured” if PRINCETON:
(1) Immediately tenders the amounts in the claim summary spreadsheet previously provided with no requirement for the policyholders to sign a release.
While the policyholder is requesting that this be done to “cure” this Civil Remedy Notice, they are willing to consider, and may accept, any reasonable counteroffer. Therefore, if PRINCETON disagrees with the requests, the policyholder requests that PRINCETON make a counteroffer before the end of the “cure period” and provide supporting documentation for any such offer so that the policyholder may understand any discrepancies that could exist regarding the estimates.
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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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