General Considerations common to most Florida Homeowners Insurance Policies :
In Florida, the policy of insurance covering your home or commercial building is a contract, even though the terms and conditions are not really bargained for. This type of contract, where the drafter provides it to the insured on a take it or leave it basis is known as a contract of adhesion. Importantly, what that means is that under Florida law, an ambiguous term in your insurance policy will be construed in the manner favoring you, the insured, in order to afford coverage. This is important for a myriad of different types of cases that will ultimately turn on the interpretation of undefined, ambiguous terms in your policy.
A contract for property and casualty insurance in Florida will provide coverage or liability on the part of the insurer if a loss is sustained that is set forth within the coverage terms of the policy only. Many policies in Florida provide coverage for physical damage to the insured structure and then set forth a list of exclusions under which coverage does not exist. Then, usually via the form of endorsement, coverages are added back into the policy for certain perils.
Florida law does not require homeowners insurance but your mortgage company may. Under the standard terms of most uniform mortgages, if you fail to maintain your insurance, the lender has the right to obtain coverage for you and place coverage on your property via a “forced-placed” policy and then charge you for the policy in addition to your loan premiums. This forced placed insurance is very expensive and should never be maintained if it can be avoided by a homeowner in Florida. In any event, you are strongly recommended to carry insurance to protect your property investment.
Most policies provide special limits of liability for the loss of certain items of personal property like antiques, jewelry or works of art. You can ask your agent about the particular caps on the personal property items but unfortunately you will be unable to recover a cumulative value of lost personal property that exceeds the designated policy amount in a covered loss.
In Florida your homeowners insurance policy will be broken down into coverage limits, these are often provided with labels such as, Coverage A, Coverage B and so forth. Typically Coverage A represents the total coverage for the insured structure and Coverage B will provide additional coverage for attached structures. When selecting insurance or preparing to file a claim, you must look at the coverage amounts listed to identify all potential sources of recovery. Additionally, your policy will run for a particular term. Typically an annual term, that will provide the coverages listed in your policy for a particular date. When first reporting your loss, remember that the “date of loss” means the date when the occurrence first occurred. The date of loss governs the applicable policy and coverages in force to provide coverage for your loss. Often coverages change year to year. If you are reporting a claim that occurred in the past, it is essential that you review your property insurance policy before filing to ensure that you have coverage for the peril or loss you will be seeking coverage for.
Types of Coverage in a Florida Property Insurance Policy
Additional Living Expense Coverage, often referred to as ALE, provides coverage or payments under your policy for the expenses incurred should you be forced from your residence or structure as a result of a covered peril. Most policies provide coverage for this loss on an as incurred basis, meaning that your carrier, if the loss is confirmed, will provide reimbursement for your out of pocket expenses for alternative living arrangements up to a certain threshold.
One of the most important basic concepts to understand your Florida Policy of Homeowners Insurance is the difference between replacement cost and actual cash value of damaged property. Replacement cost provides coverage for the amount needed to replace or repair damaged items in the event of a covered peril. Actual cash value (ACV) on the other hand only provides coverage for the amount needed to repair or replace an item less the applicable depreciation. This is especially relevant for older components of your structure like your roof. A depreciated value will significantly reduce your available policy benefits under Florida law.
Most homeowners insurance policies do not provide coverage for flood damage! Check your policy to determine whether you have coverage for flood loss if you are in an area that could be damaged by rising water.
Sinkhole Loss and Catastrophic Ground Cover Collapse are two very important provisions of your homeowners insurance policy. Sinkhole damage can devastate your home. Despite the misconception provided through the news reports, sinkhole damage is not just sudden depressions that open up in the earth. It is simply the result of dissolutionment of limestone over time that causes a floor slab foundation to move. Sinkholes are very prevalent in Florida. Should you have the ability to afford sinkhole coverage, we strongly recommend that you pay the premium to obtain the endorsement and coverage.
Ordinance and Law Coverage in Florida provides for the increased costs of a loss associated with the forced compliance with regulations in the Florida Building Code or any applicable government condition should you need to rebuild your structure or a part of it. This extra coverage is optional.
Filing a Claim in Florida
Filing an insurance claim simply requires that you notify your insurer of the loss and the surrounding circumstances associated with the loss. Your carrier will then assign either an in house adjuster or a third party adjuster to contact you or your attorney to begin the investigation of the loss. The investigation may include a written estimate of the observed damage and may require that the insurance company retain an outside company (ie an engineering firm) to provide an investigation. Additionally, the typical insurance claim adjustment in Florida will require that you provide your insurance carrier representative documents relevant to the property or the loss and provide a recorded statement or an examination under oath or both. Before providing a recorded statement or examination under oath, we strongly recommend that you seek the advice of legal counsel. Many denials of insurance claims are based upon information garnered from unprepared claimants.
If you have misplaced your policy of insurance, you should request a new copy upon filing your claim or before so that you can review the applicable coverages and conditions. Florida law requires that your insurance company provide a certified copy of the policy within 30 days of your request.
If your Claim is Denied
If your insurance company has denied your claim, they have identified a policy exclusion for not providing you coverage. The reasons for denials are wide and varied and can include things like a failure to comply with a condition precedent, excluded causes of the observed damage or the failure to comply with your post loss obligations. No matter the reason for the denial don’t despair, our office can help you review the validity of your claim and if it was wrongfully denied we will file suit and take your case trial to get you the benefits that you deserve.
If your Claim is Confirmed
One of the more sophisticated ways that insurance companies make money is through providing low ball or partial coverage for a loss. Your property is your primary investment and you need to make sure that you have done your due diligence to protect it. Ultimately, most large insurance companies will have an approved list of vendors that provide estimates routinely for losses. These companies generate serious money for insurance company contracts and therefore have an implicit bias in providing conservative repair quotes. Even if your claim is covered an your happy with the estimate provided by your carrier, take the time to consult with an insurance attorney to obtain a second opinion.