You reported a homeowner’s claim to your insurance company. It’s probably your first time, and you trust that your insurance company will expedite a full inspection and proper adjustment of your loss under the terms and conditions of your policy. Whether the loss is caused by a fire, water via a broken or burst pipe, hail or wind storm, including hurricane, you expect to be treated honestly and fairly and with due regard for your interests. After all, you pay your premiums each year, and that’s what Florida law requires of your insurance company.
Florida Statute 627.7015 “Alternative procedure for resolution of disputed property insurance claims” creates a procedure for setting up a mediation conference between the homeowner and the insurance company, with a neutral mediator presiding over the session. In the first letter you receive from your insurer following the reporting of a claim, the insurance company is required by law to
inform you of the Department of Financial Services (“DFS”) mediation program for residential property claims, and to provide you a copy of the DFS mediation pamphlet outlining the program and providing a phone number for requesting to participate. So, the first thing you might do if your claim is denied or underpaid is to contact the DFS to schedule a mediation. After all, by law it’s paid for by the insurance company, so why not give it a try. Your insurance policy may even require you attend such a mediation before you can file a lawsuit to challenge a claim denial or coverage dispute.
Unfortunately, you likely don’t really know whether your claim was fairly adjusted and coverages applied or paid correctly. Already you are at a disadvantage in the process. You may think, because the mediation program is run by the State, and a person called a “mediator” will be there, that you will give it a try. After all, the statute (quoted in the pamphlet) states that the mediation is meant to be “an informal, nonthreatening forum for helping parties who elect this procedure to resolve their claims disputes”. And, the Statute states that “participation by legal counsel is permitted”, so you can get a lawyer to be there with you.
When you appear at the mediation conference, likely you will do so alone, or perhaps with a contractor who’s willing to come with you to speak to any disputed repair costs. You may have a lawyer, but likely won’t because you think you’ll be able to convince the insurance company of your position once you’re sitting across the table. Or, you can’t find a lawyer experienced in property owner insurance claims, or one you’d be willing to pay by the hour. And, of course, a neutral mediator will be there to assist you.
DFS property mediation for the most part serves only the insurance company’s interests. Insurers typically appear at these mediations through adjusters, their own or freelancers (“independent adjusters”) who regularly attend these sessions for the company. It would be rare to have the adjuster on your claim attend a DFS property mediation. These mediation adjusters have marching orders, which generally entail maintaining the company claim adjustment position while offering you a minimal amount to settle the claim dispute if a full release is signed by you. (You may feel pressured to take the money and to sign the release because you have no understanding of your bargaining position and aren’t sure what to do next if you walk out.) The mediator will typically either not have any experience with property insurance, estimating or contracting, however even if they do, the rules forbid a mediator from giving you advice and from arguing your position.
You have time before the mediation conference, and afterwards, to make sure you understand what to expect. Please call us with your questions about the DFS residential property mediation program, including how to prepare for the conference and what to expect for your type of claim or dispute. We specialize in property owner insurance claims and litigation. All Danahy & Murray lawyer consultations are free of charge.