When you own a home or commercial piece of property, it is important to prepare for the worst, such as wind damage or water damage from hurricanes, losses incurred in a fire or damage caused by sinkholes. Therefore, most property owners carry home or commercial property insurance policies. It may seem obvious that if a property owner files a legitimate home or commercial property insurance claim in accordance with the terms of their policy, that claim will be honored, and the property owner will be appropriately reimbursed. However, some insurers in Florida will try to find ways out of having to pay policyholders what they are due.
An insurance policy is essentially a contract between the insurer and the policyholder. Thus, the insurer is bound to act in good faith. If the insurer improperly investigates the policyholder's claim, unreasonably denies a legitimate claim without an explanation or fails to pay claims within the required time period, these could be deemed acts of bad faith.
Under Florida law, if an insurer commits certain acts of bad faith, the policyholder may seek to hold the insurer liable through a civil claim. In certain circumstances, it may even be possible to hold the insurer liable not just for the pecuniary damages the policyholder suffered, but also to impose punitive damages against the insurer. When pursuing such claims, it is not necessary for the policyholder to prove the insurer's actions constituted a general business practice.
Those who hold home or commercial property insurance policies deserve to have those policies honored when appropriate. If an insurer acts in bad faith, it could give rise to a legal claim. However, insurers will do their utmost to fight such claims. Therefore, it is important for policyholders in such situations to have a thorough understanding of their rights, so they can prepare the strongest claim possible.