An appellate court in Florida, reversing a trial court's decision, has ruled that appraisal was warranted – rather than litigation – where an insurer had not wholly denied coverage of its insured homeowners' claim and the parties' dispute was over the amount of the homeowners' loss.
The Case
Jose and Stefania Colucciello submitted a claim to their insurer, First Protective Insurance Co. d/b/a Frontline Insurance Co., for damage they asserted their home had sustained due to water intrusion from Hurricane Irma.
First Protective investigated and paid the Colucciellos more than $100,000 on their claim for both mold damage and other interior damage to their home. First Protective, however, declined to pay for certain exterior damage to the home.
The Colucciellos sued First Protective for breach of contract, and it moved to dismiss and to compel an appraisal under the terms of the insurance policy.
Following a brief hearing, the trial court denied First Protective's motion to compel appraisal, and First Protective appealed.
First Protective argued that the trial court had erred in denying its motion because the dispute between the parties related to the total amount of the Colucciellos' loss, which, it contended, was properly determined by appraisers under the terms of the insurance contract.
The Colucciellos responded that the trial court ruled correctly because First Protective denied coverage for the exterior damage to their home and, as such, whether this aspect of their claim was covered under their insurance policy was a determination to be made by the trial court.
First Protective countered that it did not “wholly deny” coverage on the Colucciellos' claim and that, under Johnson v. Nationwide Mutual Ins. Co., 828 So. 2d 1021 (Fla. 2002), this was not a dispute over coverage but, instead, merely a disagreement between the parties to the insurance contract on the amount of the loss, which was an issue to be determined under the insurance policy by an appraisal.
The Appellate Court's Decision
The appellate court reversed and remanded with directions to the trial court to compel an appraisal.
In its decision, the appellate court explained that the Colucciellos submitted one claim under their policy for damage to their home caused by water intrusion. The appellate court added that First Protective agreed that this was a covered claim and it paid a “significant amount of money on the claim” to the Colucciellos or on their behalf, but disagreed with them as to the total amount owed.
The appellate court concluded, therefore, that, under Johnson, coverage was not “wholly denied” by First Protective and, under the terms of the parties' insurance contract, an appraisal was required to determine the total amount of the loss.
The case is First Protective Ins. Co. v. Colucciello, No. 5D19-31 (Fla. Ct. App. July 12, 2019). Attorneys involved include: Jay M. Levy, of Jay M. Levy, P.A., Miami, and Karen Fultz, of Sheehee & Associates, P.A., Miami, for Appellant. Matthew G. Struble, of Struble, P.A., Fort Lauderdale, for Appellees.
Insurance Coverage Law Center Comment
Other appellate courts in Florida have reached the same conclusion. See State Farm Ins. Co. v. Sheppard, 268 So. 3d 1006 (Fla. Ct. App. 2019); MKL Enters. LLC v. Am. Traditions Ins. Co., 265 So. 3d 730 (Fla. Ct. App. 2019); People's Tr. Ins. Co. v. Garcia, 263 So. 3d 231, 233 (Fla. Ct. App. 2019); People's Tr. Ins. Co. v. Tracey, 251 So. 3d 931, 933 (Fla. Ct. App. 2018).
Steven A. Meyerowitz
Steven A. Meyerowitz, a Harvard Law School graduate, is the founder and president of Meyerowitz Communications Inc., a law firm marketing communications consulting company. He may be contacted at [email protected].