What Is Bad Faith Insurance in Florida?

What Is Bad Faith Insurance in Florida?

Bad faith insurance in Florida is when an insurance company fails to handle a valid claim honestly and fairly — by unreasonably denying, delaying, underpaying, or refusing to investigate a claim it should pay. Florida law (Fla. Stat. § 624.155) lets policyholders hold insurers accountable, but only after filing a Civil Remedy Notice and giving the insurer 60 days to fix the problem.

What "Bad Faith" Actually Means Under Florida Law

Insurance is a contract built on a duty of good faith. When you pay your premiums, your insurer promises to investigate, evaluate, and pay covered claims promptly and fairly. Bad faith is the breach of that duty — and it is more than a simple disagreement over how much your claim is worth.

Florida recognizes two distinct types of bad faith:

• First-party bad faith — your own insurer mishandles a claim you filed on your own policy (a homeowner's hurricane claim, a sinkhole claim, a disability or health claim). Florida courts do not recognize a common-law first-party bad faith action; the right exists only by statute, under Florida Statutes § 624.155.
• Third-party bad faith — your liability insurer exposes you to a judgment above your policy limits, usually by unreasonably refusing to settle a claim a third party brought against you. This claim exists at common law and is judged by the factors in Boston Old Colony Ins. Co. v. Gulf Assurance Co.

Common examples of insurer conduct that can rise to bad faith in Florida include:

• Denying a claim without a reasonable investigation or any stated, legitimate basis
• Offering far less than a claim is clearly worth ("lowballing") to pressure a quick settlement
• Unreasonable, repeated delays in adjusting, approving, or paying a covered claim
• Misrepresenting policy language or coverage to avoid paying
• Demanding excessive, duplicative documentation as a stalling tactic
• Failing to communicate or ignoring the policyholder's correspondence
• Failing to settle a third-party claim within limits when it reasonably could have

Importantly, since Florida's 2023 insurance reforms (Senate Bill 2-A), mere negligence by the insurer is not enough to constitute bad faith on its own. There must be conduct that goes beyond a careless mistake — though negligence can still be one piece of evidence in the larger picture.

The Civil Remedy Notice — Florida's Required First Step

For a statutory first-party bad faith claim, Florida does not let you sue the insurer right away. You must first file a Civil Remedy Notice of Insurer Violation (CRN). This is a condition precedent — skip it, and your bad faith lawsuit will be dismissed.

Here is how the CRN process works:

1. File the CRN online. The notice is submitted electronically through the Florida Department of Financial Services (DFS) Civil Remedy portal at the Department's website. The insurer and DFS are both notified.
2. State the violation specifically. A valid CRN must identify the specific statutory provisions the insurer violated, the facts supporting each violation, the policy language at issue, and the specific cure you are requesting (for example, payment of a stated amount). A vague or boilerplate CRN can be ruled legally insufficient.
3. The 60-day cure window starts. Once the insurer receives the CRN, it has 60 days to pay the damages or correct the conduct that gave rise to the violation.
4. Cure extinguishes the claim. If the insurer pays or fixes the problem within those 60 days, your statutory bad faith claim is gone. This is not a technicality — paying within the cure window is the insurer's complete defense to a § 624.155 action.

A reform-era wrinkle to know: for residential property claims, a CRN may not be filed within 60 days after appraisal is invoked by any party. If you or your insurer demands appraisal, the bad faith clock is paused.

What You Must Prove and What You Can Recover

To win a first-party bad faith claim in Florida, you generally must first establish coverage and the amount of your loss — through a judgment, an appraisal award, an arbitration award, or a settlement in your favor. You cannot litigate bad faith and the underlying coverage dispute at the same time; coverage and damages come first, then bad faith.

Once that is settled, the bad faith question is whether the insurer acted fairly and honestly toward you, with due regard for your interests — the standard the jury is given. The "totality of the circumstances" is examined: Did the insurer investigate properly? Communicate? Evaluate the claim reasonably? Pay what it owed when it owed it?

If you prevail, § 624.155 allows recovery of damages that the contract alone would not — potentially including:

• The full amount of your damages, even beyond the policy limits
• Court costs and reasonable attorney's fees
• In appropriate cases, interest and other consequential damages flowing from the bad faith

This is what makes a bad faith claim powerful: it shifts the financial pressure back onto the insurer that wrongly denied or delayed.

Deadlines and How to Protect Your Claim

Two clocks matter, and missing either can end your case:

• Statute of limitations. A first-party statutory bad faith claim is generally subject to Florida's five-year statute of limitations for actions on a written contract. Because exactly when the clock starts can depend on when the underlying claim is resolved, do not wait — confirm your deadline with an attorney early.
• The 60-day cure period described above, which must run before any lawsuit.

To put yourself in the strongest position, gather and preserve:

• Your complete insurance policy, including the declarations page and all endorsements
• The full claim file — every email, letter, denial, reservation-of-rights letter, and estimate
• A dated log of every call and contact with the insurer (who, when, what was said)
• Photos, repair estimates, invoices, and expert reports documenting the loss and its value
• Proof you met your own duties under the policy (prompt notice, a sworn proof of loss if required, cooperation with the investigation)

Documenting the insurer's delays, shifting explanations, and lowball offers builds the record that proves bad faith.

Frequently Asked Questions

Q: Is bad faith the same as simply denying my claim? A: No. An insurer is allowed to deny a claim if it has a genuine, reasonable basis to dispute coverage or value. Bad faith is when the denial, delay, or underpayment is unreasonable — without proper investigation, without a legitimate basis, or used as a tactic to avoid paying what is clearly owed.

Q: Do I have to file a Civil Remedy Notice before suing for bad faith in Florida? A: Yes, for a statutory first-party bad faith claim under § 624.155. The CRN is a mandatory condition precedent, and the insurer gets 60 days to cure. A third-party bad faith claim (failure to settle within limits) does not require a CRN, but the rules differ — a lawyer can tell you which applies.

Q: What happens if the insurer pays during the 60-day cure period? A: If the insurer pays the damages or corrects the violation within 60 days of receiving the CRN, your statutory bad faith claim is extinguished. You still receive the money owed, but you generally lose the ability to pursue the additional bad faith damages and fees for that conduct.

Q: Can I still claim bad faith if my insurer was just careless? A: Not on negligence alone. Since the 2023 reforms, mere negligence is insufficient by itself to establish bad faith in Florida. Negligence can still be relevant evidence, but you need conduct that, taken together, shows the insurer failed to act fairly and honestly toward you.

Q: How long do I have to bring a bad faith claim in Florida? A: A first-party statutory bad faith claim is generally governed by Florida's five-year statute of limitations for written-contract actions. The precise start date can hinge on when the underlying claim is resolved, so confirm your specific deadline with an attorney as soon as possible.

Q: What can I recover that my insurance policy alone wouldn't pay? A: A successful bad faith claim can recover your full damages even above the policy limits, plus court costs and reasonable attorney's fees, and in some cases interest and other consequential losses — remedies a straight breach-of-contract claim does not provide.

Talk to a Florida Attorney

If your insurer has denied, delayed, or underpaid a claim you believe is covered, you may have more rights than the policy alone suggests. Florida's bad faith statute is powerful, but it is procedural and unforgiving — the Civil Remedy Notice must be precise, and the deadlines are real. Louis Law Group helps Florida policyholders hold insurers accountable.

See if you qualify or call (833) 657-4812 for a free, no-obligation review of your claim.