Insurance Services – Coverage & Bad Faith Litigation

The Third District Court of Appeals of Florida is the latest to join the growing number of Florida appellate courts that have ruled that the pre-suit notice provision of section 627.70152 is procedural in nature and, as such, applies retroactively to policies in existence prior to the statute’s effective date of July 1, 2021. 

In February 2024, the Third District ruled in Cantens v. Certain Underwriters at Lloyd’s London that section 627.70152 evinces a clear legislative intent to apply to all property insurance policies and its retroactive application would not impact a substantive right of the insureds.

In Cantens, the insured filed suit for breach of contract against its homeowners insurance carrier. However, they failed to file the statutorily mandated notice of intent to initiate litigation to the Division of Financial Services. The lower court granted the insurance company’s motion to dismiss based on the insured’s failure to file this pre-suit notice, and the insured appealed the decision.

In reaching its decision, the Third District aligned itself with the Fourth District Court of Appeals, which came to an analogous decision last year. 

In May 2023, the Fourth District Court of Appeals found that the pre-suit notice as mandated by Florida Statute 627.70152 does apply retroactively to insurance policies entered into before the statute’s effective date. 

In Herman Cole v. Universal Property & Casualty Insurance Company, the court was asked to determine whether the trial court wrongfully dismissed the plaintiff’s lawsuit for homeowners insurance benefits upon granting the defendant’s motion to dismiss for failure to comply with the pre-suit notice requirement established in section 627.70152. The Fourth District Court affirmed, finding that because the pre-suit notice requirement of section 627.70152 applies retroactively as a procedural provision, it applies to existing policies in effect at the time of enactment. In its opinion, the court found that the legislature expressed a clear intent for the statute to apply retroactively by expressly stating that this statute “applies exclusively to all suits...arising under a residential or commercial property insurance policy....”

Resolution of this issue is far from over, and the appellate courts are increasingly looking to the Florida Supreme Court for guidance. 

In November 2023, the Sixth District Court of Appeal of Florida, in direct conflict with the Fourth District Court of Appeal of Florida, found that the pre-suit notice as mandated by Florida Statute 627.70152 does not apply retroactively to insurance policies entered into before the statute’s effective date. 

Notably, the Sixth District’s ruling in the case of Hughes v. Universal Property & Casualty Insurance Company focused on the retroactive applicability of a statutory pre-suit notice requirement enacted after an insurance policy was issued, but before a breach of contract lawsuit regarding that policy was filed. Holding that section 627.70152 does not apply retroactively to an insurance policy entered into before the statute’s effective date, the court concluded that there was no clear evidence of legislative intent for the statute to apply retroactively and that the statute was substantive in nature, therefore, making its retroactive application unconstitutional.

The key analysis in these cases remains closely influenced by the precedent established by the Florida Supreme Court ruling in Menendez v. Progressive Express Insurance Co., 35 So. 3d 873 (Fla. 2010), which involved an amendment to a different statutory scheme, where the court held that a statutory pre-suit notice requirement was a substantive change that could not be applied retroactively to policies issued before the amendment’s effective date.

While the number of cases this particular statute applies to grow smaller as we head further away from the short window of time a number of claims were filed before the 2021 statute took effect, the plaintiff and defense bar remain optimistic that the Florida Supreme Court will settle the issue. 

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^{Legal Update for Insurance Services, February 22, 2024, has been prepared for our readers by Marshall Dennehey. It is solely intended to provide information on recent legal developments and is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. We welcome the opportunity to provide such legal assistance as you require on this and other subjects. If you receive the alerts in error, please send a note to tamontemuro@mdwcg.com. ATTORNEY ADVERTISING pursuant to New York RPC 7.1. © 2024 Marshall Dennehey. All Rights Reserved.}