An insurance company attempted to defeat a couple's bad faith insurance claim because the homeowners had not completed any legal actions regarding breach of contract. The trial court agreed that the plaintiffs needed to show that they had already gained a favorable ruling against the insurance company before making a bad faith claim. The court dismissed their case, but the appeals court reversed the decision and sent the case back to trial. The Florida appeals court rejected the citation of a 1991 case as justification for dismissing the case. It found that the language in that decision did not establish breach of contract actions as prerequisites for bad faith lawsuits.
The homeowners had collected the full extent of their insurance policy for sinkhole damage to their home, which they submitted as evidence of the insurance company's liability in the case. They had already gone through a long process with the insurance company prior to filing a bad faith claim. The insurer had originally accepted that the policy could pay for repairs to address sinkhole damage but then insisted that a sinkhole was not present.
After the homeowners filed a civil remedy notice, the insurance company had 60 days to resolve the dispute. The insurer eventually conceded the issue to the policy holders and paid them up to the policy limit 231 days later. The appeals court determined that this met the conditions necessary to make a bad faith claim.
A person with concerns about a denied claim or slow payments could consult an attorney. Bad faith insurance claims typically involve detailed contracts, and an attorney could study the terms and provide an opinion about the person's legal position.