COVERAGE POSITION / DENIAL RESPONSE TOOLKIT — FLORIDA

JURISDICTION NOTE: Florida's bad faith framework underwent sweeping changes in 2022-2023. SB 2-A (December 2022) and HB 837 (March 2023) fundamentally altered the landscape. Key changes: (1) One-way attorney fees under § 627.428 were repealed for most lines (retained only for declaratory judgment actions on total denials, excluding property insurance); (2) Fla. Stat. § 624.155 remains the vehicle for first-party statutory bad faith, but the insurer now has a 90-day safe harbor to tender policy limits after a demand; (3) There is no common law first-party bad faith in Florida — QBE Insurance Corp. v. Chalfonte Condominium Apartment Ass'n, 94 So. 3d 541 (Fla. 2012); (4) A Civil Remedy Notice (CRN) must be filed with DFS as a condition precedent to a § 624.155 action, with a 60-day cure period. Practitioners must carefully track these statutory prerequisites.

PART ONE: FORMAL DENIAL RESPONSE LETTER

[LAW FIRM LETTERHEAD]

[__/__/____]

VIA CERTIFIED MAIL, RETURN RECEIPT REQUESTED, AND EMAIL

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

Re: Response to Coverage Denial
Insured: [________________________________]
Policy Number(s): [________________________________]
Claim Number: [________________________________]
Date of Loss: [__/__/____]
Your Denial Letter Dated: [__/__/____]

Dear [________________________________]:

This firm represents [________________________________] ("Insured") regarding the above-referenced claim under Policy No. [________________________________] issued by [________________________________] ("Insurer"). We respond to your denial letter dated [__/__/____]. The denial is without merit and violates the standards of Fla. Stat. § 626.9541(1)(i). We demand that it be reversed immediately. If the Insurer does not cure its wrongful denial, the Insured will file a Civil Remedy Notice under Fla. Stat. § 624.155 and pursue all available remedies.

I. IDENTIFICATION OF DENIAL AND STATED BASES

Your denial relies on:

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

Each basis is refuted below.

II. FACTUAL CORRECTIONS

Misstatement 1: Your letter states: "[________________________________]"
Correct Fact: [________________________________] (See Exhibit [____])

Misstatement 2: Your letter states: "[________________________________]"
Correct Fact: [________________________________] (See Exhibit [____])

Misstatement 3: Your letter states: "[________________________________]"
Correct Fact: [________________________________] (See Exhibit [____])

These errors indicate the claim was denied without a thorough investigation, in violation of Fla. Stat. § 626.9541(1)(i)3.c. and 3.d.

III. COVERAGE ANALYSIS AND REBUTTAL

A. The Insuring Agreement Provides Coverage

The Policy provides:

"[________________________________]"
(Policy, Section [____], p. [____])

The loss falls within this insuring agreement because:

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

Under Florida law, insurance policies are construed in favor of coverage. Auto-Owners Ins. Co. v. Anderson, 756 So. 2d 29, 34 (Fla. 2000). Ambiguous terms are construed against the insurer. Swire Pacific Holdings, Inc. v. Zurich Ins. Co., 845 So. 2d 161, 165 (Fla. 2003).

B. The Cited Exclusion(s) Do Not Apply

Your denial relies on:

"[________________________________]"
(Policy, Section [____], p. [____])

☐ The exclusion is inapplicable. The facts do not satisfy the exclusion because [________________________________].

☐ An exception restores coverage. "[________________________________]."

☐ The exclusion is ambiguous. Under Florida law, exclusionary clauses are strictly construed against the insurer. Anderson, 756 So. 2d at 34.

☐ The insurer bears the burden. Under Florida law, the insurer bears the burden of demonstrating the applicability of any policy exclusion. Wallach v. Rosenberg, 527 So. 2d 1386, 1388 (Fla. 3d DCA 1988).

☐ The concurrent causation doctrine applies. Under Florida law, when covered and excluded perils concur to cause a loss, coverage exists for the covered portion. Sebo v. American Home Assurance Co., 208 So. 3d 694 (Fla. 2016).

C. Policy Conditions Have Been Satisfied

☐ Timely Notice: Given on [__/__/____]. Florida generally requires the insurer to show prejudice from late notice in first-party property claims. Bankers Ins. Co. v. Macias, 475 So. 2d 1216 (Fla. 1985).

☐ Cooperation: Fully cooperated.

☐ Proof of Loss: Submitted on [__/__/____]. Under Fla. Stat. § 627.70131(5), the insured must submit a sworn proof of loss within the policy's requirements.

☐ EUO: Completed on [__/__/____].

D. Duty to Defend (Liability Policies)

☐ Under Florida law, the duty to defend depends on the allegations of the complaint compared with the policy terms. If the allegations "potentially" bring the claim within coverage, the insurer must defend. National Union Fire Ins. Co. v. Lenox Liquors, Inc., 358 So. 2d 533 (Fla. 1977).

IV. DEMAND

1. Withdraw the denial and confirm coverage in writing within ten (10) days;
2. Pay the claim in the amount of $[________________________________] within [____] days;
3. ☐ Assign defense counsel and commence defense immediately;
4. Provide a complete copy of the claim file;
5. If you maintain the denial, provide a detailed written explanation.

NOTICE: Under Fla. Stat. § 627.70131, the insurer must pay or deny a claim within 90 days after receiving notice of the initial claim (or, for claims arising out of a hurricane or windstorm, 90 days). Failure to comply may constitute a violation of the statute.

V. NOTICE OF POTENTIAL BAD FAITH LIABILITY UNDER FLA. STAT. § 624.155

Be advised that the wrongful denial of this claim may give rise to statutory bad faith liability under Fla. Stat. § 624.155.

Florida Bad Faith Framework:

1. No common law first-party bad faith. Florida does not recognize a common law bad faith cause of action for first-party insurance claims. QBE Insurance Corp. v. Chalfonte Condo. Apartment Ass'n, 94 So. 3d 541 (Fla. 2012). First-party bad faith claims must be brought under § 624.155.

2. Condition precedent: Civil Remedy Notice (CRN). Before filing a § 624.155 action, the insured must file a Civil Remedy Notice with the Florida Department of Financial Services (DFS) and the insurer. Fla. Stat. § 624.155(3)(a).

3. 60-day cure period. The insurer has 60 days from the date the CRN is filed electronically with DFS to cure the violation by paying the claim or correcting the conduct. If the insurer cures within 60 days, no bad faith action may be brought. § 624.155(3)(c).

4. 90-day safe harbor (HB 837). Under the 2023 tort reform, where an insured or third-party claimant sends a demand for policy limits, the insurer is immunized from bad faith if it tenders policy limits (or the demanded amount, whichever is less) within 90 days. § 624.155(8).

5. Insured's duty of good faith (HB 837). HB 837 imposed a reciprocal duty on insureds, claimants, and their representatives to act in good faith in providing information, making demands, setting deadlines, and settling. Failure to act in good faith may reduce damages. § 624.155(9).

Damages available under § 624.155:

• Compensatory damages for all losses caused by the bad faith
• Attorney fees (under § 624.155(6), but subject to post-HB 837 limitations)
• Court costs
• Pre-judgment interest

Note: Punitive damages are NOT available under § 624.155 unless the insurer's conduct constitutes willful, wanton, and malicious violation. § 624.155(5).

The Insured reserves all rights.

VI. CONCLUSION

Respond in writing no later than [__/__/____]. If the denial is not reversed, the Insured will file a Civil Remedy Notice under § 624.155 and pursue all available remedies.

Respectfully,

[________________________________]
[________________________________]
[________________________________]

Enclosures:
- Exhibit A: [________________________________]
- Exhibit B: [________________________________]

PART TWO: COVERAGE ANALYSIS FRAMEWORK

Step 1: Insuring Agreement Analysis

☐ Ambiguities construed against insurer. Swire Pacific, 845 So. 2d at 165.
☐ Policy construed in favor of coverage. Anderson, 756 So. 2d at 34.

Step 2: Exclusion Analysis

☐ Insurer bears burden. Wallach, 527 So. 2d at 1388.

Step 3: Exception to Exclusion

Step 4: Condition Compliance

PART THREE: COMMON DENIAL REBUTTAL ARGUMENTS (FLORIDA-SPECIFIC)

3.1 Late Notice Denial

☐ Florida generally requires the insurer to show prejudice from late notice in first-party claims. Bankers Ins. Co. v. Macias, 475 So. 2d 1216 (Fla. 1985).

☐ Notice was timely on [__/__/____].

☐ No prejudice demonstrated.

☐ Insurer waived by investigating without timely asserting late notice.

3.2 Exclusion-Based Denial

☐ Exclusions are strictly construed against the insurer. Anderson, 756 So. 2d at 34.

☐ The insurer bears the burden of proving the exclusion. Wallach, 527 So. 2d at 1388.

☐ Florida applies the concurrent causation doctrine: if covered and excluded perils both contribute, coverage exists for the portion attributable to the covered cause. Sebo, 208 So. 3d at 700.

☐ Anti-concurrent causation clauses are enforceable in Florida but construed narrowly. Sebo addressed the interplay.

3.3 Property Insurance Specific Issues (Florida)

Florida has extensive property insurance-specific statutes:

☐ § 627.70131: Claim settlement timelines — insurer must pay or deny within 90 days of initial claim notice.

☐ § 627.7015: Appraisal requirement — if there is a dispute over the amount (not coverage), the appraisal provision may be invoked.

☐ § 627.70132: Notice of property insurance claim (must be filed within specific deadlines).

☐ Post-2022 changes: SB 2-A (2022) reduced the time to report claims and limited assignment of benefits (AOB).

3.4 The Civil Remedy Notice Process

The CRN is the critical gateway to a § 624.155 bad faith action:

☐ Filing: Must be filed electronically with DFS through the online portal at https://apps.fldfs.com/civilremedy/

☐ Content requirements: The CRN must specify:
- The statutory provision violated
- The specific facts and circumstances giving rise to the violation
- The damages or injury sustained

☐ 60-day cure period: Begins on the date the CRN is electronically filed with DFS (not when the insurer receives it by mail). Talat Enterprises v. Aetna Cas. & Sur. Co., 753 So. 2d 1278 (Fla. 2000).

☐ If insurer cures: Pays the claim or corrects the conduct within 60 days, no action may be brought.

☐ If insurer does not cure: The insured may file suit after the 60-day period expires.

3.5 HB 837 Impact on Bad Faith Claims

The 2023 tort reform (HB 837) made fundamental changes:

☐ Negligence standard clarified: Mere negligence alone is insufficient to constitute bad faith. § 624.155(1)(b)2.

☐ 90-day safe harbor: If the insurer tenders policy limits (or the demanded amount) within 90 days of a demand, it is immunized from bad faith. The failure to tender within 90 days is NOT evidence of bad faith. § 624.155(8).

☐ Insured's duty of good faith: Insureds, claimants, and representatives must act in good faith in providing information, making demands, setting deadlines, and attempting settlement. Bad faith by the insured may reduce damages. § 624.155(9).

☐ One-way attorney fees repealed: § 627.428 was repealed for most lines. Attorney fees are now available only in declaratory judgment actions for total denials of coverage (excluding property insurance). § 86.121.

☐ Impact on practice: The 90-day safe harbor and insured's duty of good faith create new considerations for demand strategy and timeline management.

PART FOUR: CIVIL REMEDY NOTICE (CRN) TEMPLATE

IMPORTANT: This is a guide for the content of the CRN. The actual CRN must be filed electronically through the DFS portal. Do not mail a paper version — only electronic filing through https://apps.fldfs.com/civilremedy/ triggers the 60-day cure period.

Information Required for CRN Filing:

Insured/Claimant Information:
- Name: [________________________________]
- Address: [________________________________]
- Phone: [________________________________]
- Email: [________________________________]

Insurer Information:
- Insurer Name: [________________________________]
- NAIC Number: [________________________________]
- Policy Number: [________________________________]
- Claim Number: [________________________________]

Statutory Violation(s) Alleged:

☐ § 624.155(1)(a)1 — Violation of § 626.9541(1)(i) (unfair claim settlement practices) — Specify subsection:
- ☐ § 626.9541(1)(i)3.a — Misrepresenting pertinent facts or policy provisions
- ☐ § 626.9541(1)(i)3.b — Failing to acknowledge and act promptly on communications
- ☐ § 626.9541(1)(i)3.c — Failing to adopt reasonable investigation standards
- ☐ § 626.9541(1)(i)3.d — Refusing to pay without reasonable investigation
- ☐ § 626.9541(1)(i)3.e — Failing to affirm or deny coverage timely
- ☐ § 626.9541(1)(i)3.f — Not attempting good faith settlement
- ☐ § 626.9541(1)(i)3.g — Compelling litigation through lowball offers

☐ § 624.155(1)(b) — Not attempting in good faith to settle when obligation to do so has become reasonably clear

Specific Facts Supporting Violation:

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

Damages or Injuries Sustained:

[________________________________]
[________________________________]

PART FIVE: FLORIDA DEPARTMENT OF FINANCIAL SERVICES COMPLAINT

[DATE: __/__/____]

Florida Department of Financial Services
Division of Consumer Services
200 East Gaines Street
Tallahassee, FL 32399-0322
Phone: 1-877-693-5236
Online: https://www.myfloridacfo.com/division/consumers/

Re: Consumer Complaint Against [________________________________]
Insured: [________________________________]
Policy Number: [________________________________]
Claim Number: [________________________________]

Dear Chief Financial Officer:

I file this complaint against [________________________________] for unfair claim settlement practices.

Facts

1. Policy No. [________________________________], effective [__/__/____] to [__/__/____].
2. Loss on [__/__/____].
3. Claim reported on [__/__/____].
4. Denial on [__/__/____], citing [________________________________].

Violations Under Fla. Stat. § 626.9541(1)(i)

☐ § 626.9541(1)(i)3.a — Misrepresenting policy provisions
☐ § 626.9541(1)(i)3.c — Failure to adopt investigation standards
☐ § 626.9541(1)(i)3.d — Denial without investigation
☐ § 626.9541(1)(i)3.e — Failure to timely affirm or deny
☐ § 626.9541(1)(i)3.f — Failure to attempt good faith settlement
☐ Other: [________________________________]

Requested Relief

1. Investigate; 2. Require payment; 3. Enforce; 4. Advise.

Enclosed Documents

☐ Policy ☐ Denial letter ☐ Correspondence ☐ Supporting documentation

Respectfully submitted,

[________________________________]

PART SIX: DEMAND FOR RECONSIDERATION

[LAW FIRM LETTERHEAD]

[__/__/____]

Re: Demand for Reconsideration
Claim Number: [________________________________]

Dear [________________________________]:

We demand reconsideration based on:

☐ Independent expert report (Exhibit [____])
☐ Repair estimate of $[________________________________] (Exhibit [____])
☐ Engineering report (Exhibit [____])
☐ Witness statements (Exhibit [____])
☐ Photographs/video (Exhibit [____])
☐ Other: [________________________________]

Reverse the denial within fifteen (15) days. If the denial is not reversed, the Insured will file a Civil Remedy Notice under § 624.155.

Respectfully,

[________________________________]

PART SEVEN: LITIGATION PRE-FILING CHECKLIST (FLORIDA)

7.1 Pre-Suit Requirements — CRITICAL

☐ Civil Remedy Notice (CRN) REQUIRED. A CRN must be filed electronically with DFS as a condition precedent to filing a § 624.155 action. § 624.155(3)(a).
☐ 60-day cure period must expire. Cannot file suit until 60 days after CRN filing. § 624.155(3)(c).
☐ Underlying coverage determination. The insured must first establish the insurer's obligation to pay (e.g., through a breach of contract judgment or settlement). Blanchard v. State Farm Mut. Auto. Ins. Co., 575 So. 2d 1289 (Fla. 1991).
☐ Breach of contract claim may need to be resolved first. Florida law generally requires that the insurer's liability for coverage be established before a first-party bad faith action can proceed.
☐ Consider whether the 90-day safe harbor (HB 837) applies if a demand was sent.
☐ Department of Financial Services complaint filed (optional but recommended).

7.2 Statute of Limitations

☐ Breach of contract: Five (5) years. Fla. Stat. § 95.11(2)(b).
☐ § 624.155 bad faith: Five (5) years from the date the cause of action accrued. § 95.11(2)(b) (treated as contract-based).
☐ Note: The bad faith claim typically does not accrue until the underlying coverage obligation is established.
☐ Considerations: SB 2-A and HB 837 may affect accrual dates for claims arising after effective dates.

7.3 Causes of Action

☐ Breach of insurance contract
☐ Statutory bad faith under § 624.155 (requires CRN + 60-day cure)
☐ Declaratory judgment (coverage determination)

Note: No common law first-party bad faith in Florida. QBE v. Chalfonte, 94 So. 3d 541 (Fla. 2012).

Note: One-way attorney fees under § 627.428 have been repealed for most lines by HB 837. Attorney fees in declaratory judgment actions for total denials are available under § 86.121 (excluding property insurance).

7.4 Damages Under § 624.155

☐ Compensatory damages for all losses caused by bad faith
☐ Attorney fees (subject to post-HB 837 limitations)
☐ Court costs
☐ Pre-judgment interest
☐ Punitive damages only if willful, wanton, and malicious. § 624.155(5). Subject to Fla. Stat. § 768.73 caps (three times compensatory damages or $500,000, whichever is greater)

7.5 Two-Step Process

Florida requires a two-step process for first-party bad faith:

1. Step 1: Establish the insurer's contractual liability (breach of contract judgment or settlement)
2. Step 2: File § 624.155 bad faith action (after CRN + 60-day cure)

The bad faith action cannot be filed before Step 1 is complete.

7.6 Venue

☐ Florida Circuit Court
☐ Venue: county where insured resides, loss occurred, or policy was issued
☐ Federal court if diversity exists

PART EIGHT: FLORIDA-SPECIFIC PRACTICE NOTES

8.1 Key Florida Bad Faith Cases

8.2 The Civil Remedy Notice: Practical Guide

The CRN is the single most important procedural requirement in Florida bad faith practice:

1. Where to file: Only through the DFS electronic portal at https://apps.fldfs.com/civilremedy/
2. When to file: After the insurer's coverage liability has been established or is reasonably clear
3. Content: Must specify the statutory provision violated, specific facts, and damages
4. Cure period: 60 days from electronic filing (not from insurer's receipt). The 60-day cure period begins on the date of electronic submission.
5. What constitutes cure: Payment of the claim or correction of the circumstances
6. If cured: No bad faith action may be brought
7. If not cured: File suit after 60 days

8.3 Impact of HB 837 (2023 Tort Reform)

HB 837 made the following changes effective March 24, 2023:

1. One-way attorney fees repealed (§ 627.428/626.9373) for most lines
2. Negligence insufficient for bad faith — must be more than mere negligence
3. 90-day safe harbor for tendering policy limits
4. Insured's duty of good faith — reciprocal obligation
5. Failure to tender within 90 days is inadmissible as evidence of bad faith
6. Property insurance excluded from the limited attorney fees provision in declaratory judgment actions

Practice Impact: These changes significantly affect litigation strategy. Attorneys must carefully evaluate:
- Whether attorney fees are recoverable (line of insurance, type of denial)
- Whether the 90-day safe harbor was triggered
- Whether the insured met its reciprocal duty of good faith
- Whether claims arose before or after the effective date of the legislation

8.4 Property Insurance Claims: Special Considerations

Florida's property insurance market has been particularly volatile. Special rules include:

☐ § 627.70131: 90-day claim handling deadline
☐ § 627.70132: Notice of property insurance claim deadlines
☐ SB 2-A (2022): Reduced claim filing deadlines, eliminated AOB for most property claims
☐ No attorney fees in property declaratory judgment actions under HB 837

8.5 Punitive Damages in Florida

Under § 624.155(5), punitive damages are available only for willful, wanton, and malicious conduct. Caps under § 768.73:
- Three times compensatory damages or $500,000, whichever is greater
- No cap for intentional misconduct or conduct motivated by financial gain

8.6 Statute of Limitations Considerations

☐ The bad faith claim under § 624.155 generally does not accrue until the underlying coverage liability is determined
☐ The statute of limitations for bad faith is five years (contract-based period)
☐ Claims arising before vs. after HB 837 effective date (March 24, 2023) may be subject to different rules

SOURCES AND REFERENCES

• Fla. Stat. § 624.155 (Civil Remedy/Bad Faith): https://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0600-0699/0624/Sections/0624.155.html
• Fla. Stat. § 626.9541 (Unfair Claims Practices): https://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0600-0699/0626/Sections/0626.9541.html
• DFS Civil Remedy Notice Portal: https://apps.fldfs.com/civilremedy/
• Florida DFS Consumer Services: https://www.myfloridacfo.com/division/consumers/
• HB 837 (2023 Tort Reform): https://www.flsenate.gov/Session/Bill/2023/837
• SB 2-A (2022 Insurance Reform): https://www.flsenate.gov/Session/Bill/2022A/2A

This template is provided for informational purposes only and does not constitute legal advice. It must be reviewed and customized by a qualified attorney licensed in Florida before use. Florida insurance law underwent significant changes in 2022-2023 and practitioners must verify the current state of the law.

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