When a hurricane damages your house, you anticipate your insurance coverage firm to play truthful. However what occurs when insurers undervalue claims, drag out disputes, after which cover behind new legal guidelines to keep away from accountability? That’s exactly what occurred in Cindy Vo v. Scottsdale Insurance coverage Firm—a case that delivered an important victory for policyholders in Florida.
A Basic Case of Undervaluation
In 2020, Vo, a home-owner, filed a hurricane harm declare with Scottsdale Insurance coverage Firm. Scottsdale’s response? An incredibly low estimate of $420.64—an quantity so small it didn’t even exceed the wind deductible. Scottsdale paid nothing.
Vo employed a public adjuster, who estimated the harm at $38,584. Scottsdale wasn’t budging. The insurer introduced in one other adjuster, who conveniently agreed with Scottsdale’s unique, drastically low valuation.
Pissed off, Vo filed a Civil Treatment Discover (CRN), alleging unhealthy religion and statutory violations. After a protracted battle, an appraisal awarded her $34,545.66—proving Scottsdale had grossly underpaid. The insurer lastly paid up, and the breach of contract case was settled in 2021.
Does Florida’s New Legislation Dangerous Religion Legislation Block Unfair Claims Apply Lawsuits?
In 2022, Florida’s legislature handed part 624.1551, creating new limitations for policyholders to sue insurers for unhealthy religion. Underneath this legislation:
- Policyholders couldn’t file a foul religion lawsuit except a courtroom had dominated the insurer breached the contract.
- Appraisal awards didn’t depend as proof of breach.
- The legislation utilized to extracontractual damages claims beneath part 624.155.
This stacked the deck in opposition to policyholders, giving insurers a strong escape path to keep away from accountability.
When Vo filed her unhealthy religion lawsuit in 2023, Scottsdale used the brand new legislation as a protect, arguing she couldn’t sue as a result of her declare had settled by way of appraisal—not a courtroom ruling.
The trial courtroom agreed with Scottsdale and dismissed her case, ruling that her unhealthy religion declare was invalid and not using a formal courtroom dedication of contract breach. This view is the “get out of jail free card” rationale, which many wrongful-acting carriers use, as famous in Dangerous Religion Insurance coverage Practices Shielded By “Get Out of Jail Free” Late Funds. Chip Merlin said the plain irony of such a rule:
Think about a world the place breaking the principles carries no actual penalties. That’s the fact policyholders face when insurance coverage firms delay or wrongfully deny claims, solely to make a late cost after an appraisal and stroll away with none actual accountability….
…for those who finally pay what you owe—irrespective of how lengthy you drag it out—you’ll be able to keep away from any actual penalties for wrongful declare practices. The result’s an uneven enjoying subject the place policyholders endure by way of monetary uncertainty, property deterioration, and authorized battles whereas insurance coverage firms use delay ways as a calculated enterprise technique.
The logic behind shielding insurers from unhealthy religion legal responsibility after a late cost is deeply flawed. When a policyholder recordsdata a authentic declare, they achieve this as a result of they want the cash to restore their residence, exchange their belongings, or recuperate from a loss instantly. A wrongful denial or extended delay doesn’t simply create inconvenience—it will possibly power enterprise house owners and households into monetary misery, go away buildings in disrepair, and disrupt lives. It undermines the explanation why People buy insurance coverage within the first place. The truth that an insurer can later ‘repair’ the state of affairs with a cost—together with curiosity—doesn’t erase the hurt brought on by the preliminary refusal to pay or roadblocks inflicting delay.
Thankfully, Vo didn’t surrender. She appealed, arguing that the brand new legislation couldn’t apply retroactively to her case since her unhealthy religion declare had vested earlier than the statute was enacted.
The First District Court docket of Enchantment agreed, 1 holding that:
- New legal guidelines can not retroactively remove a legitimate reason behind motion.
- Part 624.1551 imposed new authorized burdens on policyholders, which means it might solely apply prospectively.
- Vo’s proper to sue for unhealthy religion had already vested in 2021—earlier than the legislation existed.
What This Means for Florida Policyholders
This ruling protects policyholders and sends a robust message. Insurers can’t rewrite historical past. If unhealthy religion occurred earlier than a brand new legislation, policyholders nonetheless have the suitable to sue. Appraisal isn’t a loophole for insurers. Simply because a declare settles by way of appraisal doesn’t imply insurers acted in good religion. Holding insurers accountable remains to be attainable. Regardless of legislative efforts to weaken client protections, courts aren’t letting insurers off the hook.
Policyholders Should Battle Again
For years, insurers have pushed for legal guidelines that make it more durable for householders to problem unhealthy declare dealing with. Cindy Vo’s case proves that policyholders can combat again—and win.
In case you’re coping with a lowball declare supply or unfair denial:
- Doc every thing – Preserve information of estimates, inspections, and insurer communications.
- Search knowledgeable assist – Public adjusters and attorneys can degree the enjoying subject.
- Don’t settle for the primary supply – Problem any suspiciously low harm estimates.
- Know your rights – The legislation is evolving, and courts nonetheless shield policyholders.
This Florida unhealthy religion legislation determination is a step in the suitable route, making certain that insurers can’t use new legal guidelines to erase previous misconduct. This can be a warning to insurers that unhealthy religion conduct received’t go unchallenged.
Thought For The Day
“You can not oppress the people who find themselves not afraid anymore.”
—Cesar Chavez
1 Vo v. Scottsdale Ins. Co., No. 1D2023-2228 (Fla. 1st DCA Feb. 26, 2025).