Case Law Update: FIGA v. Simmons and FIGA v. Synergy Contracting, Florida DCAs Cut the Fee Share Out of Pre-Insolvency Settlements

On September 2, 2026, Florida's Third District Court of Appeal reversed an order requiring the Florida Insurance Guaranty Association to pay the entire $75,000 a Miami-Dade homeowner had settled for with her carrier before it went insolvent. The case is Florida Insurance Guaranty Association v. Danielle Simmons, No. 3D25-0873, an appeal from the Circuit Court for Miami-Dade County (Lower Tribunal No. 19-29387-CA-01), Judge Charles Kenneth Johnson. Judge Fernandez wrote for a panel with Judges Miller and Lobree, and the court sent the case back for an evidentiary hearing rather than fixing the figures itself.

A settlement signed, then an insolvency

Simmons sued her homeowner's carrier, United Property & Casualty Insurance Company, in October 2019 over Hurricane Irma damage. The parties mediated on November 11, 2022 and agreed to a lump sum of $75,000. The mediator's written confirmation said the claim was settled for that amount, was inclusive of all claims, and that each party was "responsible for its own attorney's fees and costs incurred in connection with this matter, including the cost of mediation." Nothing split the $75,000 into a benefits portion and a fee portion.

The general release did divide the money into three checks: $37,500 to Simmons, Joe Simmons, Stellar Public Adjusting Services and Rushmore Loan Management Services; $22,500 to current counsel Deniz S. Cankaya, P.A.; and $15,000 to former counsel The Diener Law Firm, P.A., which held a charging lien. After the settlement was signed but before the money moved, United was declared insolvent and FIGA stepped in as statutory guarantor. Simmons moved to substitute FIGA and enforce the deal. FIGA paid the first check and refused the $37,500 running to the law firms.

Why the guaranty fund is not simply a substitute insurer

FIGA is a creature of statute, limited to paying "covered claims," which section 631.54(4), Florida Statutes (2022), defines as a claim "which arises out of, and is within the coverage, and not in excess of, the applicable limits of an insurance policy" issued by an insurer that goes insolvent. In Petty v. Florida Insurance Guaranty Association, 80 So. 3d 313 (Fla. 2012), the Florida Supreme Court held that statutory attorney's fees are not part of a covered claim, because they do not arise from the insolvent carrier's policy. The panel repeated the rule from Florida Insurance Guaranty Association v. Waterfire Restoration, LLC: "[C]overed claims which FIGA pays must come from coverage within the policy, and not merely from a post-loss settlement agreement."

The presumption that decided the appeal

The trial court found the agreement "very generic," with no clear allocation to fees, and enforced the whole $75,000 under what it called unusual circumstances. The Third DCA treated that missing allocation as the homeowner's problem, not FIGA's. Citing FIGA, Inc. v. Ray Wilson, No. 4D2025-0232 (Fla. 4th DCA July 8, 2026), which quoted Wade v. Wade, 63 So. 2d 184 (Fla. 1953), it applied this rule: "A general settlement will be presumed to include all existing demands between the parties, imposing on the party claiming that certain items were not included the burden of proving that fact." Because Simmons had pled entitlement to fees under section 627.428, Florida Statutes (2022), a statute since repealed effective March 24, 2023 (ch. 2023-15, Laws of Florida), the presumption ran against her, and the court wrote that "the absence of a clear allocation was not a basis for the trial court to enforce the settlement".

The panel also pointed to the mediator's email confirming $75,000 "inclusive of fees and costs", the charging lien references, the two checks to law firms, and a concession by her counsel at the hearing: "Thus, there is an admission on the record that at least part of the payment was for attorney's fees."

What the remand actually asks

This is not a ruling that Simmons gets the $37,500, or nothing. The disposition is narrow. The court remanded "for an evidentiary hearing to determine whether any portion of the payments to the attorneys was for attorney's fees" and, for any portion that was not, whether it "resulted from coverage provided by the insurance contract." That second half matters because Simmons argued part of the $22,500 check covered her public adjuster's commission rather than legal fees. A footnote adds that the opinion "should not be construed as having any preclusive impact on any contingency arrangement between the insured and her counsel."

What this means if your Florida carrier became insolvent

Several Florida property insurers have gone into receivership recently, and every pending settlement with one raises this question. Some general observations, none a prediction about any file:

• A lump sum with no allocation is not a safe harbor. Here the silence was read against the insured who had pled fees, not against FIGA.
• Payee structure is evidence. Separate checks to law firms, charging lien references and the mediator's email were read as proof of a fee component.
• Public adjuster compensation is a separate question, and the remand expressly asks whether any non-fee portion came from policy coverage.

The Second District companion case: FIGA v. Synergy Contracting Group

A second decision issued the same day reached the same result on cleaner facts, and it is the one that spells out who carries the burden. In Florida Insurance Guaranty Association v. Synergy Contracting Group, Inc. a/a/o Arlette Schmidt, No. 2D2025-0999 (Fla. 2d DCA Sept. 2, 2026), an appeal from the Circuit Court for Pinellas County (Judge Patricia Muscarella), the Second District reversed a final judgment that had enforced a settlement against the guaranty fund. Judge Atkinson wrote the opinion. Judges Northcutt and Rothstein-Youakim each concurred specially.

Synergy, which the opinion describes only as "an assignee of the insured" Arlette Schmidt, had sued United Property & Casualty Insurance Company for breach of the policy and settled. The agreement set a "Settlement Amount" of $90,000 paid in two checks, $83,887.32 to Synergy and $20,000 payable directly to Synergy's law firm. Those two figures as recited in the opinion do not add up to the stated $90,000 total, and the opinion does not explain the difference. It stated that the Settlement Amount "is inclusive of attorneys' fees, costs, and interest," that "[t]herefore" the $20,000 "will be made out solely to" the firm, and that "[a]ny remaining costs and fees will be the responsibility of the parties." United became insolvent after the agreement was signed but before it was performed, and FIGA was substituted as the defendant under sections 631.55(1) and 631.57(1)(b), Florida Statutes (2023).

The Second District reversed and remanded, holding that the $20,000 obligation was for attorney's fees that were "not within the coverage of [the] insurance policy" and therefore not a "covered claim" under section 631.54(4). The court read the agreement's own words against the assignee, noting that the complaint had sought fees under section 627.428 rather than under the policy, "which did not provide coverage for attorney's fees."

The burden point that goes beyond both records

The passage most likely to be cited going forward is about who loses when the allocation is unclear. The court wrote that "courts are not at liberty to err on the side of speculative or merely possible FIGA liability" and are "not free to give an insured or its assignee the benefit of the doubt about whether an insurer's pre-insolvency settlement obligation falls within the statutory criteria for a covered claim." Instead, the insured or assignee "must establish that what it seeks from FIGA constitutes a 'covered claim.'" Synergy's argument that the direct payment to its lawyers was merely a matter of convenience was called "speculative and without record support."

The two special concurrences are worth noting, because they show the reasoning is not settled even where the outcome is. Judge Northcutt agreed with reversal based on the agreement's language, but disagreed with the majority's reliance on Florida Insurance Guaranty Ass'n v. Ramos, 427 So. 3d 187 (Fla. 3d DCA 2026), "insofar as the opinion in that case incorrectly posits" that a pleaded fee entitlement means a direct payment to counsel "could only be read as being intended to cover" a section 627.428 fee claim. Judge Rothstein-Youakim wrote separately to point out that the trial court had relied on FIGA v. Soto, 979 So. 2d 964 (Fla. 3d DCA 2008), which the Florida Supreme Court expressly disapproved in Petty, and that Synergy's alternative theory could not be considered on appeal, both because it had not been urged below and because it was "not clear from the language of the Settlement Agreement or from anything else in the record." The opinion carries the standard note that it is "subject to revision prior to official publication."

Practical notes for assignees and contractors

The Synergy record adds a wrinkle for contractors and others holding an assignment of benefits, since the assignee stands in the insured's place but recovers from FIGA only through the statute. General observations, not advice about any particular file:

• Silence and shorthand both cut the same way. A lump sum with no allocation was read against the insured in Simmons, and an express "inclusive of attorneys' fees" recital was read against the assignee in Synergy.
• What the complaint pled matters later. In both cases the pleaded section 627.428 fee claim was treated as evidence of what the settlement money was for.
• Arguments not made in the trial court may be unavailable on appeal, as the second concurrence in Synergy notes.
• Insolvency risk is a live drafting question while a carrier is still solvent, not only after a receivership order.

Neither opinion is final until rehearing time runs, and both should be read on their own records, not as guidance about any other claim. If a Florida property insurer has denied, underpaid or delayed your residential claim, Louis Law Group offers a free case evaluation. See our guide on a denied homeowners insurance claim in Florida.

Cases: Florida Insurance Guaranty Association v. Danielle Simmons, No. 3D25-0873 (Fla. 3d DCA Sept. 2, 2026), on appeal from the Circuit Court for Miami-Dade County, Lower Tribunal No. 19-29387-CA-01; and Florida Insurance Guaranty Association v. Synergy Contracting Group, Inc. a/a/o Arlette Schmidt, No. 2D2025-0999 (Fla. 2d DCA Sept. 2, 2026), on appeal from the Circuit Court for Pinellas County. Article current as of September 6, 2026.