What Every Florida Property Insurance Policyholder Should Know About Bad Faith
When you pay your premiums on time, you expect your insurance company to uphold its end of the bargain. Unfortunately, not all insurers act in good faith. They often use deliberate tactics to delay, deny, or underpay valid claims. At Williams Law, P.A., we help policyholders across Florida recognize the signs of insurance bad faith and fight back when their rights are violated.
What Is Bad Faith Insurance?
Ever feel like your insurance company is ghosting you? When they ignore valid claims, delay payments, or flat-out lie, that might be bad faith.
- First-Party Bad Faith: When an insurance company refuses to investigate correctly, underpays, or wrongfully denies a policyholder’s claim.
- Third-Party Bad Faith: When an insurer fails to protect its policyholders from liability, it exposes them to financial losses beyond their policy limits.
Bad Faith vs. Breach of Contract
It’s important to distinguish between a breach of contract and bad faith. While both involve the insurer failing to pay a claim, bad faith implies malicious intent, negligence, or deceptive behavior.
- A breach of contract may occur if the insurer denies a claim that it honestly believed was not covered.
- Bad faith, however, implies the insurer knew or should have known the claim was valid and deliberately failed to act.
You may pursue both actions simultaneously, depending on the circumstances of your claim.
Common Signs of Bad Faith
Unreasonable Delays
An unjustified delay in processing or responding to your claim can be a significant red flag. Florida insurers are bound by timelines under § 627.70131, F.S., which mandates acknowledgment of claims within 14 days and payment or denial within 90 days.
Warning Signs:
- You receive repetitive excuses without a concrete reason.
- Adjusters “go silent” for weeks or months.
- No status updates or next steps are communicated.
Lowball Settlement Offers
Offering significantly less than your claim is worth, especially without proper justification, is a classic bad-faith tactic. This is common in hurricane, roof, and water damage claims.
What to Look For:
- Settlement offers that don’t match repair estimates.
- Offers that don’t include depreciation breakdowns or detailed justification.
- Claims adjusters pressuring you to settle quickly.
Denying Valid Claims Without Explanation
A complete denial without an explicit and legitimate reason is one of the blatant signs of bad faith.
Examples:
- Denying a wind damage claim by calling it “wear and tear.”
- Refusing to honor coverage that is explicitly stated in your policy.
- Vague references to exclusions without citing policy language
Misrepresenting Policy Language or Coverage
Insurers may intentionally twist or misstate the terms of your policy to avoid liability.
Tactics Include:
- Telling you something isn’t covered when it is.
- Citing “exclusions” that do not apply.
- Using ambiguous policy language to confuse policyholders.
Failing to Investigate the Claim Thoroughly
Insurers must conduct a fair, prompt, and complete investigation. They may act in bad faith if they fail to send an adjuster, ignore key evidence, or rely only on biased third-party reports.
Indicators:
- No physical inspection of the property.
- Adjusters fail to consider the expert reports you’ve provided.
- Investigators rush through or overlook apparent damage.
Failing to Provide a Written Explanation of Denial
Under Florida law, an insurer must provide a written explanation of a denial, including the facts and policy provisions it relies on. Vague, non-specific responses are unacceptable.
Unreasonable or Repetitive Requests for Documentation
Insurance companies sometimes drag out the process by repeatedly requesting the same documents or irrelevant materials.
Tactics to Watch For:
- Asking for tax returns or financials unrelated to your claim
- Demanding receipts that were already submitted
- Continually moving the goalposts for “required documentation”
This paper chase is intended to frustrate you into giving up or missing deadlines. If it feels excessive, it probably is.
Threatening or Intimidating Behavior
Insurers who try to scare you into accepting a settlement or abandoning your claim violate policy obligations and state law.
Examples:
- Threatening cancellation of your policy.
- Stating you won’t recover anything if you pursue litigation.
- Suggesting you committed fraud without evidence.
Florida’s Legal Framework for Bad Faith Insurance Claims
Statutory Bad Faith: Florida Statute § 624.155
Florida’s primary statute governing bad faith insurance is Florida Statute § 624.155, which allows policyholders to take legal action against insurers who:
- Fail to settle a claim in good faith when it could and should have been done
- Violate provisions of the Florida Insurance Code, such as deceptive practices, claim delays, or failing to act promptly on claims.
Before filing a bad faith lawsuit, the policyholder must submit a Civil Remedy Notice (CRN) to the Florida Department of Financial Services and give the insurer 60 days to cure the violation. If they fail, the claimant can proceed with a lawsuit.
Types of Claims That Often Involve Bad Faith Practices
Bad faith claims can arise from a wide range of insurance disputes, including:
Homeowners Insurance Claims
- Denied or delayed hurricane damage claims
- Underpaid fire, roof, or water damage claims
- Mold exclusions are improperly applied
Auto Insurance Claims
- Denial of uninsured motorist (UM) benefits
- Failure to settle personal injury claims
- Disputes over vehicle damage valuation
Commercial Insurance Claims
- Business interruption claims denied without a valid reason
- Delays in processing property or liability losses
- Denials based on ambiguous policy terms
Real Consequences of Insurance Bad Faith for Florida Policyholders
When an insurance company acts in bad faith, the financial and emotional consequences can be devastating. Many Florida residents experience property loss and additional hardship caused directly by their insurer’s failure to respond lawfully.
Consequences You May Face:
- Prolonged displacement from your home due to delayed property repairs
- Forced out-of-pocket expenses for repairs, temporary housing, or lost business income
- Credit damage or foreclosure due to unpaid mortgage obligations on damaged properties
- Emotional stress and anxiety, especially when claims drag on for months without resolution
- Lost business opportunities or reputation damage if a commercial claim is not settled properly
These consequences are avoidable, but only if insurance companies do their job. When they don’t, the law allows you to seek justice and recover every dollar you’re entitled to.
Document Everything: Your Best Weapon Against Bad Faith
The strength of a bad faith claim often lies in your documentation. Insurers count on confusion, lack of records, and verbal-only communication to protect themselves. To level the playing field, create a paper trail when you file a claim.
What to Document:
- Date and time of every phone call or email
- Name and title of every representative you speak with
- Summaries of all conversations
- Screenshots or printouts of portal messages or claim status updates
- Photos and videos of property damage
- Receipts, invoices, and estimates from contractors or appraisers
This detailed log will help your attorney build a timeline demonstrating the insurer’s delay tactics, miscommunications, or misrepresentations.
Why Is Hiring a Florida Insurance Claim Lawyer Important?
Our experienced Florida insurance claim lawyers can provide significant advantages when dealing with bad-faith insurance:
- Expert Evaluation: We can assess whether the insurer’s actions constitute bad faith and provide guidance on the best course of action.
- Effective Negotiation: Our job is to negotiate with insurers and advocate for a fair settlement on your behalf.
- Legal Representation: If necessary, we can represent you in court or legal proceedings, pursuing remedies for bad faith and protecting your rights.
- Guidance on Procedures: An attorney can guide you through the legal process, including filing a Civil Remedy Notice and understanding Florida’s insurance laws.
Get the Compensation and Justice You Deserve
Bad faith insurance practices undermine the purpose of homeowners insurance and leave policyholders vulnerable at their most difficult times. At Williams Law, P.A., we stand up for mistreated policyholders. We understand the tactics insurers use and how to beat them. Whether you’re dealing with a denied hurricane claim, an underpaid fire damage claim, or a delayed roof repair reimbursement, we’re ready to fight back.
Why Choose Us:
- Decades of experience handling Florida insurance disputes
- Aggressive litigation strategy with proven results
- No recovery, no fee — you pay nothing unless we win
- Personalized attention from attorneys who genuinely care about your case
We’ve helped hundreds of Florida families and businesses recover from losses the insurance companies tried to ignore. Now, let us help you. Contact Williams Law, P.A. today for a free consultation. Our experienced Florida bad-faith insurance attorneys fight for policyholders facing unfair claim denials and insurance company misconduct. Call 1-800-451-6786 to protect your rights and get the settlement you deserve.