Calculating the Florida Statute of Limitations in Insurance Breach of Contract Lawsuits

J.P. Gonzalez-Sirgo
Founder of J.P. Gonzalez-Sirgo, P.A.

If your home is destroyed or badly damaged by lightning, wind, fire or another type of hazard, your homeowners policy provides necessary financial protection that will provide the funds to return your home to its pre-loss condition.  Insurance companies are not necessarily anxious to pay claims because paid claims undermine the insurer’s bottom line.  This reticence to pay claims often results in disputes over whether a particular loss is covered or the value of the loss.  While these disputes can be resolved by a breach of contract lawsuit, policyholders have only a limited time to pursue a breach of contract claim. 

This time period is referred to as the “statute of limitations” and it is generally five years for a breach of contract claim in Florida.  However, this basic rule can be much more complicated because the date this five year period starts to run can be the subject of dispute.  Because a breach of the statute of limitations (SOL) will constitute a permanent bar to pursuing a lawsuit, it is critical to ensure that a policyholder complies with this requirement.

The Florida Third District Court of Appeal case of Rizo v. State Farm Florida Insurance Co. provides an example of complications involving calculation of the statute of limitations.  In October 2004, the policyholder’s home was damaged by hurricane Wilma.  The insurer made payments to the insured in January and April or 2006.  The policyholder subsequently submitted a claim for additional damages that were not part of the original claim or payment.  The insurer refused to pay the subsequent claim, and the insured filed a breach of contract lawsuit in July 2011.

State Farm asserted the statute of limitations as a defense to the breach of contract lawsuit.  The insurance company asserted that the claim was barred because the limitations period began on the date of the last payment to the insured on the original claim.  Based on this commencement date, the statute of limitations ran no later than April 2011 according to the insurer.  While the insurer claimed that the April 2006 payment constituted a “full and final payment,” the court rejected this conclusion because the payment had not been so designated.  The court found that the payments were evidence of performance under the contract rather than a breach of contract.

Based on this reasoning, the breach of contract cause of action did not accrue until the insurer refused the subsequent claim submitted in October 2010.  Since the breach of contract claim did not arise until this date, the statute of limitations did not expire prior to the insured filing a lawsuit in July of 2011.  Therefore, the appellate court reversed and remanded the case for further proceedings.

If you are frustrated with your insurer and have questions about the process for pursuing a lawsuit against your insurance company, you are welcome to contact my Miami insurance claims law firm.  My law firm represents policyholders in claims disputes in Miami and throughout Florida.  The Law Firm of J.P. Gonzalez-Sirgo, P.A. offers free consultations and case evaluations.  No Recovery, No Lawyer Fees.  Call 305-461-1095 or Toll Free 1-866-71-CLAIM.

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