When it comes to an insurance policy, the devil is in the details – just ask any of the thousands of Florida plaintiffs awaiting a resolution to their ongoing sinkhole claim. In one recent case out of Hillsborough County, the District Court of Appeal of Florida, Second District overruled an insurance company’s attempt to duck liability under a sinkhole policy based on a perceived act of misconduct by the plaintiffs during the litigation process. While the case has yet to be ultimately concluded, the court reasoned that the insurance company could not escape the plaintiff’s breach of contract claim by asserting the plaintiffs concealed the results of a neutral evaluation done of the property, and reversed the trial court’s summary judgment on the matter.
In the recent Diaz case, the plaintiffs were covered for damage and loss sustained to their property as a result of a sinkhole – which is a common phenomenon in Florida. In 2010, the plaintiffs made a claim to Tower Hill Prime Insurance Company to cover damage to their home caused by nearby sinkhole activity, which was denied following the company’s investigation into the matter. The following year, the plaintiffs hired their own investigator to conduct an evaluation of the property, and that individual concluded that the damage was, in fact, caused by sinkhole activity.
Based on this information, the plaintiffs filed a civil lawsuit citing breach of contract. During the discovery phase, the insurance company hired a neutral evaluator to conduct an analysis of the property, at which point the plaintiffs’ 2011 investigation was discovered, but never disclosed. Instead of moving forward with the neutral evaluation, Tower Hill initiated an immediate motion for summary judgment based on language of the policy prohibiting the concealment of any material fact during a policy-related conflict.
In its analysis, the court relied on a prior appellate ruling – which interestingly involved the same insurance company. In that case, Tower Hill tried to avoid breach of contract liability by sanctioning the plaintiffs for failing to disclose the results of an independent property evaluation. Also in that case, the court opined that failing to disclose the results of said independent evaluation was not the type of “material concealment” contemplated by the language of the policy and the insurer should not be able to avoid liability under this policy term. In applying an identical analysis to the Diaz case, the court reached the same conclusion, and Tower Hill will likely be required to defend against the breach of contract case in a subsequent trial.
If you are facing a difficult situation with your property insurance company and would like to discuss your options with a knowledgeable Tampa, Florida sinkhole insurance law attorney, contact Pekar Law today by calling us.