Florida’s highest court clarified in May that the state’s bad faith statute is the exclusive means by which an insured may pursue damages for the alleged mishandling of a claim.
QBE Ins. Co. v. Chalfonte Condominium Apartment Assoc. involved a coverage dispute under a property insurance policy. The insured contended that QBE’s investigation and processing of the claim had been so dilatory as to constitute a breach of the covenant of good faith and fair dealing that is implied into every contract by Florida’s common law. The insured also asserted that the policy’s hurricane deductible was invalid, because its type size and terminology allegedly violated a Florida notice statute. On an appeal from a judgment that awarded damages to the insured for bad faith, but which applied the hurricane deductible to reduce the amount of the award, the Eleventh Circuit Court of Appeals certified questions to Florida’s Supreme Court.
The Supreme Court observed that Florida’s statute governing insurer bad faith expressly creates a private right of action, and it held that such an action is the exclusive remedy for alleged misconduct in handling an insurance claim. Consequently, there is now no additional, common law cause of action for bad faith in Florida.
On the other hand, the Court held that the Florida statute containing technical requirements for a hurricane deductible does not create a private right of action and does not create penalties for non-compliance. Because “courts cannot provide a remedy when the Legislature has failed to do so,” the hurricane deductible was enforceable, despite QBE’s technical violations of the notice statute.