Insurance Bad Faith Claims in Orlando, Florida

When you purchase an insurance policy, you enter into a contract with your insurer based on a fundamental principle: they will act in good faith to honor their obligations when you file a legitimate claim. Unfortunately, insurance companies sometimes prioritize profits over policyholders, engaging in practices that constitute bad faith. For Orlando residents dealing with wrongful claim denials, delayed payments, or unfair settlement offers, understanding your legal rights under Florida law is essential.

What Constitutes Insurance Bad Faith in Florida

Insurance bad faith occurs when an insurance company fails to uphold its contractual and legal duties to its policyholders. Florida law imposes both contractual obligations and a statutory duty of good faith and fair dealing on insurers. Under Florida Statutes Section 624.155, insurance companies must investigate claims promptly, communicate with policyholders honestly, and make reasonable settlement offers based on the policy terms.

Bad faith can manifest in numerous ways, including:

• Denying a valid claim without reasonable justification or proper investigation
• Failing to conduct a thorough and timely investigation of your claim
• Misrepresenting policy provisions or coverage to justify a denial
• Offering substantially less than what the claim is worth
• Unreasonably delaying payment on a legitimate claim
• Refusing to defend you in a liability lawsuit when required by the policy
• Failing to communicate important information about your claim
• Not responding to correspondence or phone calls regarding your claim

Orlando policyholders should recognize that disagreements about coverage do not automatically constitute bad faith. The insurance company must act unreasonably, knowingly, or without proper cause for bad faith to exist. Florida courts have established that insurers must place the interests of policyholders on equal footing with their own financial interests.

Types of Insurance Policies Subject to Bad Faith Claims

Bad faith claims can arise from virtually any type of insurance policy. In Orlando, the most common bad faith cases involve:

Homeowners Insurance: Given Florida's vulnerability to hurricanes, tropical storms, and water damage, homeowners insurance disputes are particularly prevalent in Orlando. Bad faith may occur when insurers undervalue hurricane damage, wrongfully deny wind versus flood damage claims, or delay repairs following severe weather events.

Auto Insurance: Motor vehicle accidents are frequent on Orlando's busy roads and Interstate 4 corridor. Insurers may act in bad faith by denying coverage for accident-related injuries, refusing to pay for necessary medical treatment, or failing to defend policyholders in liability claims.

Health Insurance: Medical insurers sometimes deny coverage for necessary treatments, delay authorization for procedures, or refuse to pay for medications prescribed by physicians. These actions can constitute bad faith when they lack reasonable justification.

Disability Insurance: Insurance companies may improperly terminate benefits, require excessive documentation, or rely on biased medical examinations to deny legitimate disability claims.

Commercial Insurance: Orlando business owners facing property damage, liability claims, or business interruption losses may encounter bad faith when insurers fail to honor commercial policy obligations.

Florida's Legal Framework for Bad Faith Claims

Florida law provides two distinct paths for pursuing bad faith claims: first-party bad faith and third-party bad faith.

First-party bad faith involves disputes between a policyholder and their own insurance company. Florida Statutes Section 624.155 governs these claims and requires specific procedures. Before filing a lawsuit, the policyholder must provide the insurer with written notice of the bad faith claim at least 60 days before initiating legal action. This notice must include specific details about the alleged bad faith conduct. The insurer then has 60 days to cure the violation, make a reasonable settlement offer, or risk facing significant penalties.

Third-party bad faith claims arise when an insurance company fails to protect its insured from liability to another party. These claims often occur in situations where an insurer refuses to settle a claim within policy limits, exposing the policyholder to excess liability. Third-party bad faith is governed by common law principles established through Florida court decisions.

Successful bad faith claimants in Florida may recover damages beyond the original claim amount, including:

• The full amount owed under the insurance policy
• Consequential damages resulting from the insurer's bad faith conduct
• Attorney's fees and costs
• Interest on delayed payments
• Punitive damages in cases involving particularly egregious conduct

Steps to Take When Facing Insurance Bad Faith

If you suspect your Orlando insurance company is acting in bad faith, taking prompt and strategic action is crucial to protecting your rights.

Document everything: Maintain detailed records of all communications with your insurer, including phone calls, emails, letters, and in-person meetings. Note dates, times, names of representatives, and summaries of conversations. Keep copies of your insurance policy, claim forms, photographs of damage, medical records, repair estimates, and any other relevant documentation.

Follow proper procedures: Continue complying with all policy requirements, even if you believe the insurer is acting unfairly. Submit requested information promptly and keep records of what you provided. Failure to cooperate can jeopardize your claim.

Avoid recorded statements without legal counsel: Insurance adjusters may request recorded statements that could be used against you. Consider consulting with an attorney before providing detailed recorded statements beyond basic claim information.

Do not accept inadequate settlement offers under pressure: Insurance companies sometimes pressure claimants to accept lowball settlements quickly. You have the right to thoroughly evaluate any settlement offer and seek legal advice before accepting.

Consult with an experienced bad faith attorney: Florida's bad faith laws contain technical requirements and strict deadlines. An attorney experienced in handling Orlando bad faith claims can evaluate your case, ensure compliance with statutory notice requirements, and pursue maximum compensation for your losses.

Time Limits for Filing Bad Faith Claims in Orlando

Florida law imposes specific time limitations for filing bad faith claims. For first-party bad faith claims under Section 624.155, you must provide the 60-day notice before filing suit, and the overall claim remains subject to the statute of limitations applicable to breach of contract claims, typically five years from the date of the alleged bad faith conduct.

Third-party bad faith claims generally must be filed within four years under Florida's statute of limitations for these actions. However, the specific facts of your case may affect these deadlines, making it essential to consult with an attorney promptly.

Delays in pursuing bad faith claims can result in loss of evidence, fading memories of witnesses, and potentially losing your right to pursue a claim altogether. Orlando residents who suspect bad faith should seek legal guidance as soon as possible.

Insurance companies employ teams of lawyers and adjusters whose job is to minimize payouts. When facing bad faith conduct, you need an experienced advocate who understands Florida insurance law and will fight to hold insurers accountable for their obligations. Your insurance policy represents a promise that should be honored when you need it most.

Need Help? If you have questions about your case, call or text 833-657-4812 for a free consultation with an experienced attorney.

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