This is one in a line of cases we have reviewed on this blog that addresses the issue of when litigation by an insured constitutes a waiver of the right to demand appraisal. While cases we have recently discussed on this blog out of the 5th DCA have consistently indicated that the amount of time before a demand from appraisal is not dispositive, the case of FIGA v. Sill provides an unequivocal example of this position.
In Sill, the policyholders were insured by HomeWise Preferred Insurance Company when their home suffered sinkhole damage in November 2009. The homeowners filed a breach of contract lawsuit in December 2010. The answer filed by HomeWise denied coverage by rejecting the allegation that the loss was caused by sinkhole activity. After HomeWise became insolvent and FIGA was activated the lawsuit was stayed in December 2011. In May 2012, the stay on litigation was lifted and the policyholders substituted FIGA as a defendant. FIGA was granted an additional stay in October 2012, so a neutral evaluation could be completed.
When the report was prepared by the neutral evaluator, it concluded that sinkhole activity could not be ruled out as a cause of the policyholders’ loss. The expert’s report also proposed specific subsurface repairs. Based on the report, FIGA sent a letter to Sills conceding coverage. On May 13, the Sills responded by demanding appraisal. The policyholders filed a motion to compel appraisal that was granted in July.
FIGA appealed contending that appraisal was not appropriate since the dispute concerned only the method or repair rather than the value of the loss incurred. This argument was rejected in summary fashion based on FIGA v. Branco, which considered and rejected essentially the same argument.
The court also considered FIGA’s claim that the insured waived its right to appraisal by engaging in extensive litigation between December 2010 and July 2013. While this period of over 2.5 years might seem like a long period for litigation to have been pending. The court pointed out that HomeWise and FIGA did not concede that the insured had suffered a covered sinkhole loss and did not accept the recommendations of the neutral evaluator until April 15, 2013. Since the insurer did not agree that the claim was covered until a month before the demand for appraisal, the court found there was virtually no passage of time during which litigation was pending. Further, the court pointed out that during the brief period between conceding coverage and demanding arbitration, the insured did not engage in any litigation activity.
As an experienced Miami insurance claims attorney, I understand that navigating the insurance claims process can be frustrating and complicated. If you have questions about Miami-Dade homeowners insurance claims, you are welcome to contact my Florida insurance claims dispute 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.