When it comes to giving your insurance carrier notice of claim, I am an advocate of providing that notice as soon as possible, i.e., prompt notice. The reason is to take away the carrier’s argument to deny coverage because you, as the insured, failed to provide it with prompt notice—the “untimely notice” defense. It doesn’t matter whether it is a first party property insurance claim or third-party liability policy claim, provide notice as soon as reasonably possible to take away that “untimely notice” defense.

The “untimely notice” defense was the issue in Benson v. Privilege Underwriters Reciprocal Exchange, 48 Fla.L.Weekly D1085a (Fla. 6th DCA 2023) dealing with a first party property insurance policy.  In this case, eighteen months after Hurricane Irma, the plaintiff noticed a smell and observed brown stains on walls and ceiling in his home. The plaintiff called roofing companies to inspect the damage and perform certain repairs.  However, the plaintiff still noticed the smell so he called a company to test and remediate mold. The plaintiff, then, contacted his property insurer with numerous claims relative to the leaks and damage. Although there was an initial property insurance payment made, the carrier ultimately denied coverage for subsequent claims stating that “the late notice of the claim and the prior repairs to the roof substantially prejudiced its ability to complete an inspection of [plaintiff’s] property to evaluate the claim.” Benson, supra.   The property insurance policy included the following notice language:

In the event of a loss for which coverage may be provided under this policy, you. . .must. . .[g]ive prompt notice to us or our agent, except that a claim, supplemental claim or reopened claim for loss or damage caused by hurricane or other windstorm must be given to us in accordance with the terms of this policy within three years after the hurricane first made landfall or a windstorm other than hurricane caused the covered damage. . .Any initial, supplemental or reopened claim for loss or damage caused by hurricane or other windstorm is barred if notice of the claim in accordance with this Paragraph is not provided.

The plaintiff filed a lawsuit and the property insurance carrier moved for summary judgment based on the “untimely notice” defense, which was granted by the trial court.  This was reversed on appeal.  The Sixth District Court of Appeal provides a good discussion of the “untimely notice” defense and its two-pronged test which can serve beneficial to an insured:

“Prompt” is not defined in the policy issued by [the property insurance carrier] to [the plaintiff]. “It is well settled, however, that ‘prompt’ and other comparable phrases, like ‘immediate’ and ‘as soon as practicable,’ do not require instantaneous notice.”  “Instead, Florida courts have interpreted these phrases to mean that notice should be provided with reasonable dispatch and within a reasonable time in view of all of the facts and circumstances of the particular case.”  “[T]he duty to provide notice arises when a reasonable person, viewing all available facts and information, would conclude that an award implicating the policy is likely.” 

The Supreme Court of Florida has set forth a two-step process to determine whether an insurance company may deny an insured’s claim on the ground that the insured failed to give the insurance company timely notice of the claim as required by an insurance policy.  “The first step in the analysis is to determine whether or not the notice was timely given.”  If the notice was timely given, then the analysis concludes at the first step.  If the notice was not timely, then the second step is to determine whether the insurance company suffered prejudice as a result of the untimely notice.  At the second stage of the analysis, prejudice to the insurer is presumed.  If notice was not timely, the burden of overcoming the presumption of prejudice is on the insured.  However, the insured may rebut the presumption of prejudice by showing that the insurer was not prejudiced by the lack of timely notice.  “If the insured is unable to overcome the presumption of prejudice, then the insurer will prevail on a defense of untimely notice.” 

Benson, supra (internal citations omitted).

A good thing for the plaintiff—the insured—is that whether prompt notice was provided is typically a question of fact for the trier of fact. Benson, supra. It is based on the “reasonable person” standard, underlined above. “In this case, there was disputed evidence regarding whether a reasonable person in [the plaintiff’s] position would have concluded that he had a claim under his insurance policy any time significantly earlier than when [the plaintiff] gave notice to [his property insurance carrier] of the claim.” Benson, supra.

While the two-pronged test can seem beneficial, the reality is this is all avoidable by providing notice as soon as you reasonably can. Because if untimely notice is given and prejudice is presumed, the burden in overcoming the presumption of prejudice will be on you, as the insured, in a completely avoidable scenario.

Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.



The recent Eleventh Circuit Court of Appeals’ decision, American Builders Insurance Company v. Southern-Owners Insurance Company, 56 F.4th 938 (11th Cir. 2023), is an insurer versus insurer case that touches on two important insurance topics: (1) common law bad faith against an insurance company, and (2) an insurer’s affirmative defense that an insured settled a claim without its consent.  The Eleventh Circuit provides invaluable legal discussion on these topics that any insured (and an insured’s counsel) need to know and appreciate.  While this article won’t go into the granular facts as referenced in the opinion, it will go into the law because it is the law the facts of a case MUST cater to and address.

In this case, a person performing subcontracting work fell from a roof without fall protection and became paralyzed from the waist down. The general contractor had a primary liability policy and an excess policy. The general contractor’s primary liability insurer investigated the accident and assessed the claim.  The subcontractor’s liability insurer, which was the primary insurance policy (the general contractor was an additional insured for work the subcontractor performed for the general contractor), did little to investigate and assess the claim and then refused to pay any amount to settle the underlying claim or honor its defense and indemnity obligation to the general contractor.

Both the general contractor’s primary insurer and excess insurer each tendered policy limits to settle the claim and avoid a bad faith claim by exposing the general contractor to more than policy limits, which was the determination had the matter proceeded to a trial.

The general contractor’s primary liability insurer then sued the subcontractor’s liability insurer for common law bad faith (based on equitable subrogation).  The subcontractor’s liability insurer, among other things, argued it should be absolved because its policy was breached when payment was made to the claimant without its consent. The case proceeded to trial and a jury found in favor of the general contractor’s primary liability insurer.  The subcontractor’s liability insurer appealed…and lost.

Common Law Bad Faith

[T]he critical inquiry in a bad faith [action] is whether the insurer diligently, and with the same haste and precision as if it were in the insured’s shoes, worked on the insured’s behalf to avoid an excess judgment. Additionally, any damages claimed by an insured in a bad faith case must be caused by the insurer’s bad faith. That is, the bad faith conduct must directly and in natural and continuous sequence produce[] or contribute[] substantially to producing such [damage], so that it can reasonably be said that, but for the bad faith conduct, the [damage] would not have occurred.

The bad faith inquiry is determined under the ‘totality of circumstances’ standard, and we focus not on the actions of the claimant but rather on the insurer in fulfilling its obligations to the insured. That said, a claimant’s actions –such as a decision not to offer a settlement-remain relevant in assessing bad faith. Insurers have obligations to advise the insured of settlement opportunities, to advise to the probable outcome of the litigation, to warn of the possibility of an excess judgment, and to advise the insured of any steps he might take to avoid [the] same,” as well as to investigate the facts, give fair consideration to a settlement offer that is not unreasonable under the facts, and settle, if possible, where a reasonably prudent person, faced with the prospect of paying the total recovery, would do so. These obligations … are not a mere checklist, however, and, as the Florida Supreme Court has explained, [a]n insurer is not absolved of liability simply because it advises its insured of settlement opportunities, the probable outcome of the litigation, and the possibility of an excess judgment.

Moreover, insurance companies occasionally have an affirmative duty to offer settlements.  Bad faith may be inferred from a delay in settlement negotiations which is willful and without reasonable cause. Thus, [w]here  liability is clear, and injuries so serious that a judgment in excess of the policy limits is likely, the insurer must initiate settlement negotiations. In such a case, where [t]he financial exposure to [the insured] [i]s a ticking time bomb and [s]uit c[an] be filed at any time, any delay in making an offer under the circumstances of this case even where there was no assurance that the claim could be settled could be viewed by a fact finder as evidence of bad faith.

American Builders Insurance Company, supra, at 944-45 (internal quotation and citation omitted).

Here, the jury reasonably found that the subcontractor’s liability insurer “acted in bad faith because it delayed acting on its duty to investigate and settle [the claimant’s] claim.American Builders Insurance Company, supra at 945.  The facts “could lead a reasonable jury to conclude that the [subcontractor’s liability insurer] delayed its investigation instead of attempting ‘to resolve the coverage dispute promptly’ or using ‘diligence and thoroughness.’” Id. at 946 (internal quotation and citation omitted).

Here, a reasonable jury could also find that the subcontractor’s liability insurer caused the general contractor’s liability insurer damages.  The subcontractor’s liability insurer wanted to focus on the claimant and his attorney’s action.  This was shot down. “Of course, there’s a difference between focusing on a claimant’s actions, which would be improper, and factoring a claimant’s actions into the totality of circumstances analysis, which is not improper. In this case, though, [the subcontractor’s liability insurer] flipped Florida law on its head and exclusively focused on [the claimant and his attorney’s] actions.”  American Builders Insurance Company, supra, at 947 (internal quotation and citation omitted).

Insurer “Consent” Affirmative Defense

The subcontractor’s liability insurer argued that the general contractor’s primary liability insurer breached the subcontractor’s liability insurance contract “by failing to receive its consent before settling with [the claimant].”  American Builders Insurance Company, supra, at 944.   This was also shot down.

Subcontractor’s liability insurance contract provided:

[N]o insured will, except at the insured’s own cost, voluntarily make a payment, assume any obligation, or incur any expense, other than for first aid, without our consent. [T]his language required the insured to obtain the insurer’s consent before settling. That is, while an insured is free to enter into a reasonable settlement when its insurer has wrongfully refused to provide it with a defense to a suit, … the insured is not similarly free to independently engage in such settlements where, as here, the insurer had not declined a defense to suit.

The Florida Supreme Court requires an insurer to establish three things in order to succeed on this affirmative defense: (1) a lack of consent; (2) substantial prejudice to the insurer; and (3) diligence and good faith by the insurer in attempting to receive consent. The first element has a few exceptions. The insured may settle without obtaining consent if the insurer wrongfully refused to provide [the insured] with a defense to a suit, or offers a conditional defense that the parties cannot agree upon.  Moreover, even if the insured was obliged to obtain consent, the failure to do so is not an affirmative defense unless the insurer also establishes substantial prejudice and evinces good faith in bringing about the cooperation of the insured.

American Builders insurance Company, supra, at *947-48.

Here, the issue of whether the general contractor’s primary liability insurer needed consent was not at-issue.  It did.  But the subcontractor’s liability insurer still needed to establish substantial prejudice and good faith, and the jury could find it proved neither, which it did.  American Builders Insurance Company, supra, at *948.

Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.


Notice, notice, notice. This should be your mindset when it comes to notifying your insurance carrier of a potential claim or loss.  I get it. Notice means opening up a claim number and the potential increase in insurance premiums.  Yet, untimely notice could mean fighting with your insurance carrier as to whether you provided them prompt notice. Thus, I operate with the “notice, notice, notice” mindset in providing notice of a potential claim or loss that could trigger duties or obligations under the policy. It is the better safe than sorry approach and avoids the needless notice fight.

The property insurance opinion in SFR Services, LLC v. Hartford Insurance Company of the Midwest, 2022 WL 2340519 (S.D.Fla. 2022) illustrates this “untimely notice” fight and, importantly, how certain policy language can change the dynamics of this fight.  Here, notification of a hurricane roof damage claim was provided by the insured to the property insurer almost three years after the hurricane. In the interim, the insured had their roof repaired on multiple occasions. Finally, the insured notified the property insurer and the claim was denied. The insured sued the property insurer for coverage and the insurer moved for summary judgment arguing the insured failed to provide it timely notice as required by the policy.

[N]otice is a condition precedent to coverage, and an insured’s failure to provide ‘timely notice of loss in contravention of a policy provision is a legal basis for the denial of recovery under the policy.” SFR Services, supra, at *2 (citation omitted).

However, just because an insurer claims it did not receive timely notice does not end the discussion. There is a two-step process.  “First, the Court must determine ‘whether the insured provided timely notice.’ Second, ‘if notice was untimely, prejudice to the insurer is presumed, but that presumption may be rebutted.’”  SFR Services, supra, at *2 (citations omitted).

Step 1- Whether the Insured Provided Timely Notice

Whether the insured provided timely notice employs a reasonable person standard.  “[N]otice is necessary when there has been an occurrence that should lead a reasonable and prudent man to believe that a claim for damages would arise. SFR Services, supra (citation omitted).

Step 2- If Notice is Untimely and Prejudice is Presumed, that Presumption may be Rebutted

If notice is untimely, prejudice is presumed; but, this presumption may be rebutted by the insured.

To carry this burden, an insured must show that the insurer was able to inspect the property in the same condition it was in right after the loss by presenting evidence creating a genuine dispute of fact as to ‘(a) whether better conclusions could have been drawn without the delay in providing notice, (b) whether those conclusions could have been drawn more easily, (c) whether the repairs to the affected areas that took place in the interim would complicate and evaluation of the extent of the damage or the insured’s efforts to mitigate its damages, or (d) whether an investigation conducted immediately following the occurrence would not have disclosed anything materially different from that disclosed by the delayed investigation.’” 

SFR Services, supra, at *3 (citations omitted).

The Twist

But in this case, there is a twist.  And it is a crucial twist to this two-step process.

The Court looked at language in the property insurance policy that provided the insurer had “no duty to provide coverage under this policy if the [Insureds’] failure to comply” with their duties “is prejudicial to [Defendant].”  SFR Services, supra.

The insured argued that this policy language removes the presumption of prejudice in favor of the insurer and shifts the burden on the insurer to PROVE prejudice, i.e., that the insured’s failure to comply is prejudicial to the insurer.  There is a huge difference between prejudice being presumed because of untimely notice (which has to be rebutted by the insured) and the insurer required to prove the prejudice.  The Court found that under this language in the policy, the insurer is actually required to show prejudice:

Upon careful consideration, the Court must reject the body of precedent within this district that a presumption of prejudice may arise when a policy provision requires that an insured’s failure to comply with an enumerated duty be prejudicial to the insurer. Because there is no presumption of prejudice, a genuine issue of material fact remains as to whether the Insureds’ failure to timely notify Defendant was prejudicial, and the Motion must be denied. To hold otherwise would create a regime under which an insurer may obtain a different result in federal court than that required by the new line of cases in Florida state court.

SFR Services, supra.

This “twist” changes the dynamic of the “untimely notice” fight all due to policy language that basically says that the insurer has no coverage obligations if the insured’s failure to comply with his/her/its duties is prejudicial to the insurer.  The Court’s ruling is ultimately saying that the insurer cannot hide behind the presumption of prejudice requiring the insured to rebut the prejudice because the policy, itself, puts that burden on the insurer.  Big difference.

Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.



Have you complied with your property insurance policy’s post-loss policy obligations?   Has your property insurer argued that your failure to comply with post-loss policy obligations has resulted in you forfeiting insurance coverage?  Have you filed a lawsuit against your property insurer for coverage and the property insurer has asserted affirmative defenses based on your material breach of the policy by failing to comply with post-loss policy obligations?  


These are common questions when an insured submits a claim under a property insurance policy.   Knowing how to address these questions (and a property insurer’s coverage defenses relating to these questions) is important when pursuing a property insurance claim.



The Third District Court of Appeal in American Integrity Insurance Company v. Estrada, 44 Fla. L. Weekly D1639a (Fla. 3d DCA 2019), does a good job addressing these questions in a property insurance coverage dispute involving vandalism.   The property insurer in this case raised various forfeiture of coverage affirmative defenses relating to its insured’s failure to comply with post-loss policy conditions, e.g., (i) failure to appear for an examination under oath, (ii) failure to promptly notify the insurer of the vandalism (the loss), (iii) failure to submit a sworn proof of loos, (iv) failure to provide all requested records, and (v) failure to protect the property from further damage by making repairs.   These are fairly routine affirmative defenses raised by a property insurer.  The procedural argument in this case is not relevant; what is relevant is the Court’s discussion of an insurer’s affirmative defenses based on its insured’s failure to comply with post-loss policy obligations.  


As shown below, an insured’s breach of a post-loss policy obligation MUST be material and MUST prejudice the insurer.    An insured’s material breach of a post-loss obligation will result in a presumption of prejudice to the insurer, however, an insured can REBUT the presumption by showing the insurer was not prejudiced, which is a question of fact for the trier of fact.


1.    Breach of Post-Loss Obligations Must be “Material” 


The Third District explained:


Florida law “abhors” forfeiture of insurance coverageSee Axis Surplus Ins. Co. v. Caribbean Beach Club Ass’n, Inc., 164 So. 3d 684, 687 (Fla. 2d DCA 2014). “Moreover, ‘[p]olicy provisions that tend to limit or avoid liability are interpreted liberally in favor of the insured and strictly against the drafter who prepared the policy . . . .’ ” Bethel v. Sec. Nat’l Ins. Co., 949 So. 2d 219, 223 (Fla. 3d DCA 2006) (quoting Flores v. Allstate Ins. Co., 819 So. 2d 740, 744 (Fla. 2002)).


With these basic principles in mind, it is, unsurprisingly, well settled that, for there to be a total forfeiture of coverage under a homeowner’s insurance policy for failure to comply with post-loss obligations (i.e., conditions precedent to suit), the insured’s breach must be material. See Drummond, 970 So. 2d at 460 (concluding that the insured’s failure to comply with a post-loss obligation “was a material breach of a condition precedent to [the insurer’s] duty to provide coverage under the policy”) (emphasis added); Starling, 956 So. 2d at 513 (“[A] material breach of an insured’s duty to comply with a policy’s condition precedent relieves the insurer of its obligations under the contract.”) (emphasis added); Goldman v. State Farm Fire Gen. Ins. Co., 660 So. 2d 300, 303 (Fla. 4th DCA 1995) (“An insured’s refusal to comply with a demand for an examination under oath is a willful and material breach of an insurance contract which precludes the insured from recovery under the policy.”) (emphasis added); Stringer v. Fireman’s Fund Ins. Co., 622 So. 2d 145, 146 (Fla. 3d DCA 1993) (“[T]he failure to submit to an examination under oath is a material breach of the policy which will relieve the insurer of its liability to pay.” (quoting 13A Couch on Insurance 2d (Rev. 3d) § 49A:361 at 760 (1982) (footnote omitted) (emphasis added))).


Further, while the interpretation of the terms of an insurance contract normally presents an issue of law, the question of whether certain actions constitute compliance with the contract often presents an issue of factSee State Farm Fla. Ins. Co. v. Figueroa, 218 So. 3d 886, 888 (Fla. 4th DCA 2017) (“Whether an insured substantially complied with policy obligations is a question of fact.”) (emphasis added); Solano v. State Farm Fla. Ins. Co., 155 So. 3d 367, 371 (Fla. 4th DCA 2014) (“A question of fact remains as to whether there was sufficient compliance with the cooperation provisions of the policy to provide State Farm with adequate information to settle the loss claims or go to an appraisal, thus precluding a forfeiture of benefits owed to the insureds.”) (emphasis added).

Estrada, supra


2.   If the Breach was Material, was the Property Insurer “Prejudiced”


Although there is a split between Florida’s Fourth and Fifth District Courts of Appeal on this prejudicial element (the Fourth District has taken a more pro-insurer friendly approach), the Third District agreed with the Fifth District’s more insured-friendly approach that “the insurer must be prejudiced by the insured’s non-compliance with a post-loss obligation in order for the insured to forfeit coverage.”   


3.  Party Bearing Burden to Establish Property Insurer was “Prejudiced”


The Third District held that while prejudice to an insurer will be presumed when an insured materially fails to comply with a post-loss policy obligation, the insured can rebut this presumption by showing the insurer was not prejudiced:


[W]hen an insurer has alleged, as an affirmative defense to coverage, and thereafter has subsequently established, that an insured has failed to substantially comply with a contractually mandated post-loss obligation, prejudice to the insurer from the insured’s material breach is presumed, and the burden then shifts to the insured to show that any breach of post-loss obligations did not prejudice the insurer.

Estrada, supra.


Please contact David Adelstein at or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.