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by Giorgia Rivasi and Christine Renella 

Hurricane Milton, which is predicted to be a catastrophic major hurricane, is rapidly strengthening and approaching Florida. According to the National Hurricane Center, Hurricane Milton is forecasted to become a Category 5 hurricane by the time it hits the west coast of Florida. On October 6, 2024, Governor Ron DeSantis issued an Executive Order (EO 24-215) declaring a state of emergency in 51 counties in the State of Florida.

With the arrival and in the aftermath of Hurricane Milton, below is a checklist that Florida admitted carriers and surplus lines carriers should keep in mind when handling property claims. Florida admitted carriers are subject to the provision of Chapter 627. However, surplus lines carriers are exempt from Chapter 627, unless otherwise specified in the provision.

• Acknowledgment of the insured’s claim.Upon receipt of communication from an insured, or the insured’s representatives, with respect to a claim, the insurer shall have 7 calendar days to respond to the communication, unless payment is made within that period of time. An exception to this time frame is made when the insurer’s failure to acknowledge the claim is caused by factors beyond the control of the insurer. If the acknowledgment is not in writing, then the insurer shall create a notification in the insured’s claim file indicating the acknowledgment. Fla. Stat. § 627.70131(1)(a). This section also applies to surplus lines insurers.
  • If the insured’s communication constitutes a notification of a claim, the insurer’s acknowledgment must provide all necessary claim forms and instructions and include an appropriate phone number. The insurer is not required to provide claim forms and instruction if the acknowledgment reasonably advises the insured that the claim is not covered. Fla. Stat. § 627.70131(2). This section also applies to surplus lines insurers.
• Claim investigation.Unless otherwise provided by the policy or by law, the insurer shall begin investigating the claim within 7 days after the insurer receives proof of loss statements.  An exception is made if the insurer is unable to timely begin the investigation due to factors beyond the control of the insurer. Fla. Stat. § 627.70131(3)(a). This section also applies to surplus lines insurers.
  • If the investigation involves a physical inspection of the property, the insurer’s assigned licensed adjuster must provide the insured with printed or electronic communication including the adjuster’s name and license number. The insurer must conduct the inspection of the property within 30 days of receipt of proof of loss statements.  Stat. § 627.70131(3)(b). This section also applies to surplus lines insurers.
  • If the insurer’s adjuster generates an estimate, the insurer must send a copy of the estimate to the insured within 7 days after the estimate is generated.  Stat. § 627.70131(3)(e). This section also applies to surplus lines insurers.
• Homeowner Claims Bill of Rights.Within 14 days after receiving an initial communication with respect to a claim, an insurer issuing a personal lines residential property policy must provide a Homeowner Claims Bill of Rights. Fla. Stat. § 627.7142.
• Reservation of Rights.Within 30 days after an insurer knew or should have known of a coverage defense, written notice of reservation of rights shall be given to the insured. § 627.426(2)(a).
• Claim payment.If the insurer receives notice from the insured of an initial, reopened or supplemental claim, the insurer shall pay or deny the claim or a portion of the claim within 60 days after the insurer’s receipt of the claim. Again, an exception to this time frame is allowed if the insurer’s failure to pay is caused by factors beyond the insurer’s control. Fla. Stat. § 627.70131(7)(a). This section also applies to surplus lines insurers.
• Payment of settlement. If the insurer and the insured agree, in writing, to a settlement of the claim, the insurer shall tender payment according to the terms of the agreement no later than 20 days after the settlement is reached. If payment is not tendered within 20 days, it shall bear interest at a rate of 12% per year from the date of the agreement. Fla. Stat. § 627.4265

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The opinions expressed are those of the authors and do not necessarily reflect the views of the firm or its clients. This article is for general information purposes and is not intended to be and should not be taken as legal advice.