Yesterday’s choice from Florida’s First District Courtroom of Attraction, Bailetti v. Common Property & Casualty Insurance coverage Firm, 1 highlights an more and more tough hurdle for policyholders who declare their insurer breached the coverage by underpaying a loss. Whereas I criticize the ruling and disagree with the precedent it has created, this is a vital case for all who’re concerned in Florida property insurance coverage claims. It must be learn rigorously, because it gives sensible classes about what to do earlier than submitting a lawsuit.
The case arose from Hurricane Sally injury to a Pensacola house. The householders, Rodolfo Bailetti and Ana Saez, obtained a cost from Common for $8,125.20 primarily based on its discipline adjuster’s estimate. Their public adjuster believed the loss exceeded that determine by greater than $100,000, however his estimate was by no means launched into proof at trial. The householders filed a breach of contract lawsuit about 4 months after receiving the precise money worth cost, earlier than doing any vital repairs.
The appellate courtroom affirmed a protection verdict for Common, discovering that the insureds did not show the corporate breached the contract once they filed swimsuit. Common had paid the precise money worth, or ACV, primarily based on its adjuster’s estimate. Below part 627.7011(3)(a) of the Florida Statutes and the “Loss Settlement” clause within the coverage, the insurer is required to initially pay the ACV of the insured loss, after which pay any remaining alternative price quantities as repairs are carried out and bills are incurred.
The courtroom reasoned that as a result of Common paid its ACV estimate and the householders supplied no proof at the moment exhibiting the precise money worth cost was inadequate and that no alternative price advantages have been due, there was no breach. Later estimates produced years after the loss and simply earlier than trial couldn’t show the insurer’s earlier precise money worth cost was insufficient when made.
In essence, the courtroom held that the insurer meets its contractual obligation by paying no less than one affordable ACV estimate. As soon as that happens, the burden shifts to the insured to display that the cost did not mirror the total precise money worth loss. With out well timed proof exhibiting that Common’s ACV was too low, the courtroom concluded that the policyholders couldn’t prevail. The choice additionally relied on the courtroom’s earlier opinion in Owners Selection v. Clark, reinforcing {that a} mere disagreement over the quantity owed, unsupported by contemporaneous proof, doesn’t set up a breach.
I don’t agree with the end result. The coverage doesn’t require a policyholder to rebuild or make repairs earlier than being entitled to the total quantity of precise money worth cost due below the contract. Many policyholders can not start repairs when the insurer’s cost is much too small to begin the method. To require proof of incurred bills or accomplished work earlier than discovering a breach locations an unrealistic burden on householders, particularly after a catastrophic loss. If a policyholder can show that the insurer owes more cash below the phrases of the coverage, that must be sufficient. Partial funds which might be too low by an insurer, even at precise money worth, mustn’t excuse the duty to pay the total quantity of the lined loss. If extra is owed, and situations precedent to restoration are met or waived, the insurer’s personal underpayment, if confirmed to be an underpayment, must be sufficient.
However, the Bailetti choice stands as an essential lesson to policyholders and their attorneys that in Florida, courts are more and more centered on the timing and sufficiency of proof when evaluating breach of contract claims. Submitting swimsuit earlier than gathering stable proof that the insurer’s cost failed to fulfill the ACV requirement may end up in dropping the case altogether, even when the insurer’s preliminary estimate was later proven to be poor.
My suggestion is to jot down letters explaining the dispute and disagreement with proof and explanation why the insurance coverage firm’s place is unsuitable. This must be achieved earlier than submitting swimsuit. That is good follow generally achieved by all competent attorneys searching for to resolve the matter out of the courtroom.
Thought For The Day
“It’s not solely what we do, but in addition what we don’t do, for which we’re accountable.”
— Molière
1 Bailetti v. Common Prop. & Cas. Ins. Co., No. 1D2024-1695 (Fla. 1st DCA Oct. 8, 2025).
