When a hurricane damages your own home, you count on your insurance coverage firm to play truthful. However what occurs when insurers undervalue claims, drag out disputes, after which disguise 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 Traditional Case of Undervaluation
In 2020, Vo, a house owner, filed a hurricane injury declare with Scottsdale Insurance coverage Firm. Scottsdale’s response? A surprisingly 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 injury at $38,584. Scottsdale wasn’t budging. The insurer introduced in one other adjuster, who conveniently agreed with Scottsdale’s unique, drastically low valuation.
Annoyed, 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 Regulation Unhealthy Religion Regulation Block Unfair Claims Observe Lawsuits?
In 2022, Florida’s legislature handed part 624.1551, creating new obstacles for policyholders to sue insurers for unhealthy religion. Underneath this regulation:
- Policyholders couldn’t file a foul religion lawsuit except a court docket had dominated the insurer breached the contract.
- Appraisal awards didn’t depend as proof of breach.
- The regulation utilized to extracontractual damages claims below part 624.155.
This stacked the deck towards 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 regulation as a protect, arguing she couldn’t sue as a result of her declare had settled by way of appraisal—not a court docket ruling.
The trial court docket agreed with Scottsdale and dismissed her case, ruling that her unhealthy religion declare was invalid and not using a formal court docket dedication of contract breach. This view is the “get out of jail free card” rationale, which many wrongful-acting carriers use, as famous in Unhealthy Religion Insurance coverage Practices Shielded By “Get Out of Jail Free” Late Funds. Chip Merlin acknowledged the apparent irony of such a rule:
Think about a world the place breaking the foundations carries no actual penalties. That’s the truth policyholders face when insurance coverage firms delay or wrongfully deny claims, solely to make a late fee after an appraisal and stroll away with none actual accountability….
…in the event you finally pay what you owe—regardless of how lengthy you drag it out—you possibly can keep away from any actual penalties for wrongful declare practices. The result’s an uneven taking part in subject the place policyholders endure by way of monetary uncertainty, property deterioration, and authorized battles whereas insurance coverage firms use delay techniques as a calculated enterprise technique.
The logic behind shielding insurers from unhealthy religion legal responsibility after a late fee is deeply flawed. When a policyholder recordsdata a authentic declare, they achieve this as a result of they want the cash to restore their dwelling, change their belongings, or get better from a loss immediately. A wrongful denial or extended delay doesn’t simply create inconvenience—it might power enterprise house owners and households into monetary misery, depart constructions in disrepair, and disrupt lives. It undermines the explanation why Individuals buy insurance coverage within the first place. The truth that an insurer can later ‘repair’ the state of affairs with a fee—together with curiosity—doesn’t erase the hurt brought on by the preliminary refusal to pay or roadblocks inflicting delay.
Happily, Vo didn’t quit. She appealed, arguing that the brand new regulation couldn’t apply retroactively to her case since her unhealthy religion declare had vested earlier than the statute was enacted.
The First District Courtroom of Attraction agreed, 1 holding that:
- New legal guidelines can not retroactively remove a sound reason behind motion.
- Part 624.1551 imposed new authorized burdens on policyholders, which means it may solely apply prospectively.
- Vo’s proper to sue for unhealthy religion had already vested in 2021—earlier than the regulation 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 regulation, policyholders nonetheless have the correct 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 doable. 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 tougher for owners to problem unhealthy declare dealing with. Cindy Vo’s case proves that policyholders can combat again—and win.
If you happen to’re coping with a lowball declare provide or unfair denial:
- Doc every part – Preserve information of estimates, inspections, and insurer communications.
- Search knowledgeable assist – Public adjusters and attorneys can stage the taking part in subject.
- Don’t settle for the primary provide – Problem any suspiciously low injury estimates.
- Know your rights – The regulation is evolving, and courts nonetheless defend policyholders.
This Florida unhealthy religion regulation resolution is a step in the correct course, 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).
