This is the conclusion of an article begun in a post on Insurance Claims Bad Faith Law Blog on Sunday, March 10, 2013.
The provision of Florida Statute Section 627.70131(5)(a) which pertains to this discussion sets out a 90-day window within which to pay certain claims:
(5)(a)Within 90 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 which reasonably prevent such payment.
The charter fishing boat Joe Cool was recently the subject of a Claim under this Statute. The Joe Cool was hijacked and damaged. Certain parties made Insurance claims, although the actual Policyholder was not one of the parties making the Insurance claims at issue.
A Florida Appellate Court pointed out that these Claims were not subject to Florida Section 627.70131(5)(a) for three good reasons. First, the Florida Statute applies only to residential property insurers. Great Lakes Reinsurance (U.K.) PLC v. Branam, 2013 WL 811677 *6 (Fla. 3d DCA March 6, 2013)(STATED NOT FINAL UNTIL RELEASED FOR PERMANENT PUBLICATION). In making this ruling, the Appellate Court only followed the restrictions expressed in Subsection (4) of the same Florida Statute: "(4) For purposes of this section, the term “insurer” means any residential property insurer." In this case, Great Lakes was acting as a Marine Insurer and the Florida Statute did not apply for that reason.
Second, Subsection 627.70131(5)(a) applies to Claims received "'from a policy holder.'" Great Lakes Reinsurance (U.K.) PLC v. Branam, 2013 WL 811677 *6 n.5 (Fla. 3d DCA March 6, 2013). [Emphasis by the Court.] As noted above, the claims at issue were not received from a Policyholder.
Third and perhaps most important, Florida law did not apply in this case according to the Appellate Court. New York law applied here. Even under New York law, there were no such applicable deadlines the Florida Appellate Court ruled, and the Claims at bar were legally insufficient. The Appellate Court therefore reversed the Trial Court's denial of the Carrier's Motion for Entry of Directed Verdict and remanded with instructions to enter Judgment for Great Lakes. Great Lakes Reinsurance (U.K.) PLC v. Branam, 2013 WL 811677 *6-*7 (Fla. 3d DCA March 6, 2013).
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