Florida District Courts of Appeal recently have been very busy with cases involving the “prompt notice” provision in property insurance policies. When an insurer proves that the insured’s notice was late, courts will apply a presumption that the delay prejudiced the insurer’s ability to investigate the claim. After applying that presumption, the court will ask whether evidence shows that the insured might be able to show the insurer was not prejudiced by the late notice. If the insured can provide such evidence, then the insured can avoid a summary judgment against it.
In recent years, Florida District Courts of Appeal have dissected the circumstances in which an insured cannot overcome the presumption. In the following cases, the courts determined whether the affidavits and deposition testimony were sufficient to avoid summary judgment in favor of the insurer. Although the courts reached varying conclusions, their evaluations of the evidence are similar.
- Kramer v. State Farm, 95 So. 3d 303 (Fla. 4th DCA 2012)
- Soronson v. State Farm, 96 So. 3d 949 (Fla. 4th DCA 2012)
- Stark v. State Farm Florida Ins. Co., 95 So. 3d 285 (Fla. 4th DCA 2012)
- Slominski v. Citizens Property Insurance Corporation, 99 So. 3d 973 (Fla. 4th DCA 2012)
- 1500 Coral Towers v. Citizens Property Insurance Corporation, 2013 WL 1316416 (Fla. 3d DCA 2013)
In Yacht Club on the Intracoastal Condo. Ass’n, Inc. v. Lexington Ins.Co., 2013 WL 1932152 (S.D. Fla. May 10, 2013), however, the Southern District used a slightly different approach. This court held that, as a matter of law, the insured could not overcome the presumption of prejudice because the delay inhibited the insurer’s ability to investigate the claim. In other words, even if the insurer could investigate the claim, it could not do so with the same accuracy as it would have if the insured provided timely notice. The Southern District determined that the disadvantage to the insurer resulting from an inability to properly and timely investigate the claim warranted disposal of the case as a matter of law.
Although Yacht Club does not bind Florida trial courts, the Southern District’s approach is worth consideration. In virtually all cases where an insured fails to timely report a claim, an insurer is not given the same opportunity to mitigate the damages and investigate its coverage obligations. Does this appear to be enough to grant summary judgment in favor of an insurer in Kramer, Soronson, Stark, Slominksi, and Coral Towers? No. Should attorneys and courts review the opinion to determine whether the Florida courts have been asking the proper questions at the summary judgment stage? Yes. A case should not go to a jury simply because someone testifies that a three year delay is not prejudicial.
Applying these factual inquiries, Florida courts should review the Yacht Club decision to determine whether the question should be “did the delay prejudice the insurer?” or, as the Yacht Club decision suggests, “did the delay inhibit the insurer’s ability to conduct the most accurate investigation it could?”
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