As an insured, know YOUR rights under Florida’s Claims Administration Act (Florida Statute s. 627.426). I wrote an article on this exact topic. If a third-party claim is asserted, or in the process of being asserted, against you, do yourself a favor and consult a lawyer that can assist you with preserving your insurance coverage rights. You pay liability insurance premiums for a reason so make sure you are not doing anything that could jeopardize rights under applicable insurance policies.
A liability insurer must comply with the Claims Administration Act if it wants to deny coverage based on a coverage defense (e.g., the insured’s failure to cooperate with the insurer).
Once your liability insurer issues you a written reservation of rights letter (“[w]ithin 30 days after it knew or should have known of the coverage defense”), and it will typically issue this written letter, it has three options according to the Claims Administration Act:
1) It can refuse to defend you (i.e., deny coverage);
2) It can obtain a non-waiver agreement from you; OR
3) It can retain, independent mutually agreeable counsel to represent you.
Again, an insurer’s failure to comply with the Claims Administration will preclude it from raising a coverage defense to later deny coverage. See Geico General Ins. Co. v. Mukamal, 42 Fla.L.Weekly D1833a (Fla. 3d DCA 2017) (discussed here, and explaining that an insurer has only three options per the Claims Administration Act and it must select an option even if the insured’s conduct prevented the insurer from selecting one of the options).
Please contact David Adelstein at email@example.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.