Florida Insurance Bad Faith Demand Letter

FLORIDA INSURANCE BAD FAITH DEMAND LETTER

PRE-SUIT DEMAND AND NOTICE OF INTENT TO FILE CIVIL REMEDY NOTICE

PRIVILEGED AND CONFIDENTIAL
SETTLEMENT COMMUNICATION PURSUANT TO FLA. STAT. § 90.408

DOCUMENT INFORMATION

ADDRESSEE INFORMATION

TO:

SENDER/CLAIMANT INFORMATION

FROM:

CLAIM IDENTIFICATION

I. INTRODUCTION AND PURPOSE

This letter constitutes a formal pre-suit demand to [INSURANCE COMPANY] ("Insurer" or "Company") regarding the above-referenced claim. This demand is made on behalf of [INSURED/CLAIMANT NAME] ("Insured" or "Claimant").

IMPORTANT NOTICE: If Insurer fails to resolve this claim fairly, Insured intends to file a Civil Remedy Notice (CRN) with the Florida Department of Financial Services pursuant to Fla. Stat. § 624.155. The statutory cure period runs for 60 days after Insurer receives the notice from DFS. Failure to cure does not itself establish bad faith; it permits an action if all other elements and conditions are satisfied.

NOTE REGARDING 2022-2023 REFORMS: This demand acknowledges the significant changes to Florida bad faith law enacted through SB 2A (December 2022) and HB 837 (March 2023). The specific remedies available depend on when the claim arose and the type of insurance involved.

II. SUMMARY OF DEMAND

TOTAL AMOUNT DEMANDED: $[________________________________]

RESPONSE DEADLINE: [__/__/____] (30 days from receipt)

III. FACTUAL BACKGROUND

A. The Insurance Policy

On or about [__/__/____], Insurer issued Policy No. [________________________________] to Insured, providing coverage for [________________________________]. The policy was in full force and effect at all times relevant to this claim, with all premiums paid current.

Policy Details:

B. The Loss Event

On or about [__/__/____], Insured suffered a covered loss when:

[________________________________]
[________________________________]
[________________________________]
[________________________________]
[________________________________]

Specific Facts Regarding the Loss:

1. Date and Time: [________________________________]

2. Cause of Loss: [________________________________]

3. Nature and Extent of Damage: [________________________________]

4. Emergency Measures Taken: [________________________________]

5. Impact on Insured: [________________________________]

C. Timely Notice and Cooperation

Insured provided timely notice of the loss to Insurer on [__/__/____] by:

☐ Telephone call to claims hotline
☐ Written notice via certified mail
☐ Online claim submission
☐ Agent notification
☐ Other: [________________________________]

Insured has fully cooperated with all reasonable requests, including:

☐ Submission of Proof of Loss on [__/__/____]
☐ Submission of sworn statement in proof of loss on [__/__/____]
☐ Providing recorded statement on [__/__/____]
☐ Providing documentation including:
☐ Photographs of damage
☐ Repair estimates from licensed contractors
☐ Building permits and inspection reports
☐ Medical records and bills
☐ Police/incident reports
☐ Expert reports (engineer, public adjuster)
☐ Inventory of damaged property
☐ Financial records/business records
☐ Other: [________________________________]
☐ Permitting inspection of property on [__/__/____]
☐ Examination under oath on [__/__/____]
☐ Submission to appraisal (if invoked)

IV. CLAIM HISTORY AND TIMELINE

The following chronology documents Insurer's handling of this claim:

Total Days Since Notice: [____] days

V. COVERAGE ANALYSIS

A. Applicable Policy Provisions

The Policy provides coverage for the loss at issue:

Insuring Agreement:
[________________________________]
[________________________________]
[________________________________]

Additional Coverages Applicable:
[________________________________]
[________________________________]

B. Policy Conditions Satisfied

Insured has satisfied all conditions precedent to coverage:

☐ Timely notice of loss
☐ Submission of proof of loss
☐ Cooperation with investigation
☐ Protection of property from further damage
☐ Submission of documentation
☐ Compliance with examination under oath requirements
☐ Other conditions: [________________________________]

C. Analysis of Exclusions

Exclusion Cited by Insurer (if any): [________________________________]

Reasons Exclusion Does Not Apply:

1. [________________________________]
2. [________________________________]
3. [________________________________]

D. Coverage Conclusion

Based on the Policy language and Florida law, Insured contends that the loss is covered. The alleged denial, underpayment, or delay may support the claimed violations identified below, but a coverage dispute or mere negligence does not by itself establish bad faith.

VI. IDENTIFICATION OF BAD FAITH CONDUCT

A. Statutory Violations Under Fla. Stat. § 626.9541 (Unfair Claims Practices)

Insurer has committed unfair claim settlement practices in violation of Florida law:

☐ § 626.9541(1)(i)3.a Failing to adopt and implement standards for the proper investigation of claims

• Specific conduct: [________________________________]
• Date(s): [________________________________]

☐ § 626.9541(1)(i)3.b Misrepresenting pertinent facts or insurance policy provisions relating to coverages at issue

• Specific conduct: [________________________________]
• Date(s): [________________________________]

☐ § 626.9541(1)(i)3.c Failing to acknowledge and act promptly upon communications with respect to claims

• Specific conduct: [________________________________]
• Date(s): [________________________________]

☐ § 626.9541(1)(i)3.d Denying claims without conducting reasonable investigations based upon available information

• Specific conduct: [________________________________]
• Date(s): [________________________________]

☐ § 626.9541(1)(i)3.e Failing, upon the insured's written request, to affirm or deny full or partial coverage, state the amount or extent of partial coverage, or state that the claim is being investigated within 30 days after completed proof-of-loss statements

• Specific conduct: [________________________________]
• Date(s): [________________________________]

☐ § 626.9541(1)(i)3.f Failing to promptly provide a reasonable written explanation of the policy, facts, or law supporting a denial or compromise offer

• Specific conduct: [________________________________]
• Date(s): [________________________________]

☐ § 626.9541(1)(i)3.g Failing to promptly notify the insured of additional information needed to process the claim

• Specific conduct: [________________________________]
• Date(s): [________________________________]

☐ § 626.9541(1)(i)3.h Failing to clearly explain the nature of requested information and why it is necessary

• Specific conduct: [________________________________]
• Date(s): [________________________________]

☐ § 626.9541(1)(i)4 — First-Party Residential Property Only: Failing to pay agreed, undisputed partial or full benefits within 60 days after receiving notice of the claim, determining the amount, and agreeing to coverage, unless factors beyond the insurer's control prevent payment

• Specific conduct: [________________________________]
• Date(s): [________________________________]

B. Common Law Bad Faith

Florida recognizes common law bad faith for an insurer's failure to settle claims in good faith. Insurer's conduct demonstrates:

☐ Unreasonable delay without justification
☐ Denial without proper investigation
☐ Reliance on biased or outcome-oriented experts
☐ Ignoring evidence supporting coverage
☐ Misrepresenting policy terms
☐ "Lowball" offer not supported by evidence
☐ Failure to conduct fair and honest investigation
☐ Failure to give equal consideration to Insured's interests
☐ Other: [________________________________]

VII. LEGAL FRAMEWORK – FLORIDA BAD FAITH LAW

A. Fla. Stat. § 624.155 – Civil Remedy

Florida Statute § 624.155 creates a civil remedy for specified violations but does not preempt other statutory or common-law remedies. A claimant may not obtain judgments under both the statutory and common-law bad-faith remedies for the same claim. Key provisions include:

1. Civil Remedy Notice (CRN) Requirement: Before suit under this section, the claimant must file the DFS form with the specificity required by § 624.155(3)(b); DFS provides the notice to the authorized insurer.

2. 60-Day Cure Period: The period runs after the insurer receives the notice from DFS. No action lies if the damages are paid or the circumstances giving rise to the violation are corrected within that period.

3. Relief if the claim is proven: reasonably foreseeable damages caused by a specified violation, which may exceed policy limits; after an adverse adjudication at trial or on appeal, court costs and reasonable attorney's fees. Punitive damages require the separate frequency and culpability findings in § 624.155(8).

B. SB 2A (2022) – Property Insurance Claims Reform

For an extracontractual claim under § 624.155(1)(b) against a property insurer:

Under Fla. Stat. § 624.1551, a named or omnibus insured or named beneficiary must establish before bringing the action:

1. An adverse adjudication by court of law demonstrating Insurer breached the policy; AND
2. A final judgment has been rendered against Insurer

Important Limitations:

• Acceptance of an offer of judgment under § 768.79 does NOT constitute an adverse adjudication
• Payment of an appraisal award does NOT constitute an adverse adjudication
• The difference between insurer's estimate and appraisal award MAY be evidence of bad faith but does not alone give rise to a cause of action

C. HB 837 (2023) – Civil Remedy Statute Amendments

For claims arising after March 24, 2023:

1. 90-Day Safe Harbor (§ 624.155(4)): There can be no bad faith action against a liability insurer that tenders the lesser of (i) policy limits or (ii) the amount demanded within 90 days after receiving actual notice of claim with sufficient evidence.

2. Negligence Standard: Mere negligence alone is insufficient to constitute bad faith.

3. Claimant Duties (§ 624.155(5)): Insureds, claimants, and their representatives must act in good faith in:
   - Providing information regarding the claim
   - Making demands of the insurer
   - Setting deadlines
   - Attempting to settle the claim

Failure to do so may reduce damages in a bad faith action.

D. Key Florida Bad Faith Case Law

1. Boston Old Colony Ins. Co. v. Gutierrez, 386 So.2d 783 (Fla. 1980) – Established totality of circumstances test for bad faith.

2. State Farm Mut. Auto. Ins. Co. v. Laforet, 658 So.2d 55 (Fla. 1995) – Insurer must give equal consideration to insured's interests.

3. Harvey v. GEICO General Ins. Co., 259 So.3d 1 (Fla. 2018) – Bad faith claim may proceed even without excess judgment.

4. Berges v. Infinity Ins. Co., 896 So.2d 665 (Fla. 2004) – Insurer's duties in third-party context.

5. DeLaune v. Liberty Mutual Ins. Co., 314 So.2d 601 (Fla. 4th DCA 1975) – Bad faith may be shown by delay, inadequate investigation, or failure to pay clear claim.

VIII. DAMAGES

A. Contract Damages (Policy Benefits Owed)

B. Consequential Damages

C. Emotional Distress Damages

Insured has suffered emotional distress as a result of Insurer's bad faith conduct:

☐ Anxiety and stress
☐ Sleep disturbances
☐ Depression
☐ Physical symptoms
☐ Impact on family
☐ Other: [________________________________]

Emotional Distress Damages Claimed: $[________________________________]

D. Attorney's Fees (If Bad Faith Established)

Under Fla. Stat. § 624.155(7), court costs and reasonable attorney's fees are recoverable upon adverse adjudication at trial or on appeal. Do not treat a CRN filing, cure-period expiration, settlement, appraisal payment, or allegation of bad faith as that statutory trigger:

E. Summary of Damages

IX. SETTLEMENT DEMAND

A. Time-Limited Settlement Offer

Insured hereby demands that Insurer pay the sum of $[________________________________] within THIRTY (30) DAYS of receipt of this letter to fully resolve all claims arising from this matter.

This demand represents:
☐ Full policy benefits
☐ Policy benefits plus documented consequential damages
☐ Compromise settlement of all claims
☐ Other: [________________________________]

B. Settlement Conditions

Payment must be:

1. Made payable to: [________________________________]
2. Delivered to: [________________________________]
3. Received no later than: [__/__/____]

C. Claimant's Good Faith (Per HB 837)

Pursuant to Fla. Stat. § 624.155(5), this demand is made in good faith:

1. Information Provided: All reasonably available information supporting the claim has been provided to Insurer.
2. Reasonable Demand: This demand is based on documented losses and is a reasonable assessment of the value of the claim.
3. Reasonable Deadline: Thirty (30) days is a reasonable time to evaluate and respond to this demand.
4. Settlement Intent: Insured is prepared to resolve this matter promptly if a fair payment is made.

D. Consequences of Non-Payment

IF INSURER FAILS TO ACCEPT THIS DEMAND WITHIN 30 DAYS:

1. Insured will file a Civil Remedy Notice (CRN) with the Florida Department of Financial Services

2. After the 60-day cure period (if not cured), Insured will file suit seeking:
   - All contract damages
   - Bad faith damages under Fla. Stat. § 624.155
   - Consequential damages
   - Attorney's fees and costs
   - Pre- and post-judgment interest

3. For property insurance claims subject to SB 2A, Insured will first seek an adverse adjudication through breach of contract litigation

4. This demand letter will be evidence of Insurer's knowledge of its wrongful conduct

X. CIVIL REMEDY NOTICE – PREVIEW

If this demand is not satisfied, Insured intends to file a Civil Remedy Notice containing the following:

Statutory Provisions Allegedly Violated:
☐ Fla. Stat. § 624.155(1)(b)1 – Not attempting in good faith to settle when, under all circumstances, the insurer could and should have done so
☐ Fla. Stat. § 624.155(1)(b)2 – Making claims payments not accompanied by required statement
☐ Fla. Stat. § 624.155(1)(b)3 – Except as to liability coverages, failing to promptly settle one coverage after the obligation becomes reasonably clear in order to influence settlement under another coverage
☐ Fla. Stat. § 626.9541(1)(i)3.[____] – Applicable unfair-claim-settlement practice; under § 624.155(1), a claimant pursuing that civil remedy need not prove frequency indicating a general business practice

Statement of Facts:
[________________________________]
[________________________________]
[________________________________]

XI. PRESERVATION OF EVIDENCE

LITIGATION HOLD NOTICE

Insurer is hereby directed to immediately implement a litigation hold and preserve all documents, communications, and electronically stored information ("ESI") related to this claim:

☐ Complete claim file, including all versions
☐ All internal communications (emails, instant messages, memoranda)
☐ All communications with Insured and Insured's representatives
☐ All communications with vendors, consultants, or experts
☐ Adjuster notes, diaries, and activity logs
☐ Photographs, videos, and inspection reports
☐ Expert reports and correspondence
☐ Reserve information and reserve history
☐ Underwriting file
☐ Training materials and claims handling manuals
☐ Appraisal documents (if applicable)
☐ Similar claims data
☐ Metadata for all electronic documents
☐ Backup tapes and archived data
☐ Audio recordings of calls

SPOLIATION WARNING: Failure to preserve evidence may result in adverse inference instructions and sanctions under Florida law.

XII. APPRAISAL CONSIDERATIONS

☐ Appraisal has been invoked by: ☐ Insured ☐ Insurer on [__/__/____]
☐ Appraisal has NOT been invoked

Important Note: For a residential property insurance claim under § 624.155(3)(f):

• A CRN may not be filed within 60 days after any party invokes appraisal
• Payment of an appraisal award does not constitute an adverse adjudication for purposes of § 624.1551

If appraisal has been invoked, this demand is for amounts in dispute that may not be resolved through appraisal (e.g., coverage disputes, bad faith conduct).

XIII. CONCLUSION

Insurer's conduct in this matter has been unreasonable, unfair, and in violation of Florida law. This demand provides Insurer with a final opportunity to resolve this matter fairly before formal action is taken.

The evidence demonstrates:

1. A valid insurance policy in effect at the time of loss
2. A covered loss
3. Full compliance with policy conditions
4. Insurer's unreasonable denial, delay, or underpayment
5. Violations of Florida's unfair claims practices statutes

Failure to respond appropriately will result in the filing of a Civil Remedy Notice and subsequent litigation seeking all available damages, including attorney's fees.

SIGNATURE AND CERTIFICATION

I certify that the statements made in this demand letter are true and correct to the best of my knowledge and belief.

Insured/Claimant:

Signature: _______________________________________________

Print Name: [________________________________]

Date: [__/__/____]

Attorney for Insured (if applicable):

Signature: _______________________________________________

Print Name: [________________________________]

Florida Bar No.: [________________________________]

Firm: [________________________________]

Address: [________________________________]

Phone: [________________________________]

Email: [________________________________]

Date: [__/__/____]

METHOD OF DELIVERY

This demand letter was sent via:

☐ Certified Mail, Return Receipt Requested
Tracking No.: [________________________________]

☐ FedEx/UPS Overnight Delivery
Tracking No.: [________________________________]

☐ Hand Delivery
Delivered by: [________________________________]
Date/Time: [________________________________]

☐ Email (with delivery/read receipt)
Sent to: [________________________________]
Date/Time: [________________________________]

EXHIBITS AND ATTACHMENTS

☐ Exhibit A: Insurance Policy (Declarations Page and Relevant Provisions)
☐ Exhibit B: Proof of Loss Documentation
☐ Exhibit C: Photographs/Videos of Damage
☐ Exhibit D: Repair Estimates/Contractor Quotes
☐ Exhibit E: Correspondence with Insurer
☐ Exhibit F: Denial/Underpayment Letter(s)
☐ Exhibit G: Expert Reports (Engineer, Public Adjuster)
☐ Exhibit H: Medical Records/Bills (if applicable)
☐ Exhibit I: Property Inventory and Valuation
☐ Exhibit J: Damage Calculation Spreadsheet
☐ Exhibit K: Appraisal Documents (if applicable)
☐ Exhibit L: [________________________________]

This demand letter is intended to preserve all rights of the Insured under Florida law and shall not be construed as a waiver of any claims or remedies. All rights are expressly reserved.