New Law Affecting Homeowners Insurance Claims

On July 1, 2021, a new bill went into effect significantly impeding homeowner's rights against their homeowner's insurance carriers. Three major changes were implemented:

1. Homeowners now only have two (2) years to report a homeowners insurance claim;
2. Prior to suing your homeowners insurance company for a delay, denial, or underpay of a claim, you must file a Notice of Intent to Litigate; and,
3. Recovery of attorney fees and costs is hindered, making it more difficult for homeowners with a denied, underpaid, or delayed claim to find adequate representation and challenge a homeowner's insurance company's coverage decision.

This new law changes the time period during which a homeowner may report a claim from three (3) years down to two (2) years. Often, we don't notice the effect of water damage, hurricane damage, fire damage, vandalism damage, or any other kind of property damage, until the damage has had time to "settle in". With lower-grade hurricanes and tropical storms, for example, the damage at first appears to be minimal; a solitary loose shingle on your roof, or a small leak through your chimney, or even a little crack in the stucco of the home. Most homeowners simply patch up this "little" damage rather than make a homeowners insurance claim. But looks can be deceiving; and a few months later, or sometimes a few years later, the damage continues to recur and multiply because it was more extensive than the homeowner realized. Once the homeowner notices that the damage is extensive, it might be too late to put in a claim through their homeowners insurance.

This can happen with other types of damage as well. For example, you might come home from vacation and find your kitchen or your bathroom covered in a thin layer of water from a leaky pipe. Many homeowners will simply fix the leaking pipe and mop up the mess. Then, months or years down the line, they will notice that their floor boards or tiles start caving in or cracking or feeling hollow - these are all signs of water damage likely caused by that leaking pipe. If you don't report it within the two (2) years, your claim will be barred.

This new statute creates another hoop to jump through for homeowners whose claims have been denied, underpaid, or delayed. Although Florida Law already gives homeowners insurance companies leniency in the amount of time and manner in which they can make a coverage decision; now, after complying with all the policy requirements, and waiting months and months for homeowners insurance companies to make a coverage decision, homeowners are tasked with filing a Notice of Intent to Litigate. This Notice is difficult to navigate for someone who is not a professional in this industry. It puts insurance companies on notice that the homeowner intends to sue them, if they do not properly adjust the claim. It also allows homeowners a second bite at the apple and a new opportunity to fix their non-compliance, causing additional delays for the homeowners.

Lastly, the new statute impedes homeowners' ability to recover attorneys fees and costs from the homeowners insurance companies. Effectively making it difficult for homeowners to find representation and hampers their ability to challenge a coverage decision with which they disagree.