Rep. Rick Kriseman (D-53) is a member of the Florida House of Representatives and an attorney with Saunders & Walker PA
If Representative Dave Murzin has his way, there will be no reason for an insurance company to act in good faith when attempting to settle a personal injury claim.
Currently, Florida Statute 624.155 sets forth the manner in which an injured person who is treated unfairly by an insurance company may pursue a civil action against that insurance company for their bad faith behavior.
624.155 states that “any person” may bring a civil action against an insurer when that person is damaged by certain actions undertaken by the insurance company. Under Rep. Murzin’s bill, this language has been changed to limit that right only to the insured. So how does this change affect an injured party?
Say I am in an auto accident caused by Joe Driver, and I receive significant injuries. I make a claim with Joe Driver’s insurance company, Neverpay Insurance. Neverpay makes me a settlement offer which fails to fairly compensate me for my injuries. Under the proposed legislation, I would have no rights against Neverpay for failing to settle my claim in good faith.
Despite the fact that the bill attempts to take away the rights of third parties to pursue an insurance company for bad faith, in another section of the bill, it adds language which attempts to require that third party to “fully cooperate” with the insurance company, with failure to do so providing a defense to the carrier.
It is important to note that there is no such requirement on the insurance company, nor is their a contractual relationship between a third party and the insurance company. In fact, by nature of the claim, there is a recognized adversarial relationship between an insurance company and the third party. For example, if the third party gave a recorded statement to the insurance company, and then requested a copy of that statement from the insurance company, the company could refuse to provide the third party with his/her statement. Under this bill, the third party, if she/he was able to obtain a statement from the insurance company’s insured, would be required, if requested, to provide the insurance company with a copy of their insured’s statement.
The bill also changes the length of time an insurance company has to correct its bad faith conduct. Under current law, insurance companies must correct their conduct within 60 days of receipt of a civil remedies notice. Under Rep. Murzin’s bill, that time period has been extended to 90 days, thus giving insurance companies an additional 30 days with which to hang onto their money.
The bill also requires the party filing the civil remedies notice to state the amount he/she claims is owing. This section may have the effect of limiting the amount that the injured party can recover should the insurance company fail to remedy its conduct.
The bill also abolishes the long standing common law cause of action for bad faith, limiting the injured party to a statutory claim only.
These are just some of the highlights (or lowlights) found in this bill (there are more). Without trying to sound too melodramatic, should this bill pass the legislature and be signed into law, insurance carriers would lose all incentive to fairly and timely settle injury claims. If that happens, good luck to us all.