Narrow Promissory Estoppel Exception to Create Insurance Coverage

There is an affirmative claim known as promissory estoppel.  (Whereas equitable estoppel is used an affirmative defense, promissory estoppel is used as an affirmative claim.)

To prove promissory estoppel, a plaintiff must plead and prove the following three elements: “(1) a representation as to a material fact that is contrary to a later-asserted position; (2) a reasonable reliance on that representation; and (3) a change in position detrimental to the party claiming estoppel caused by the representation and reliance thereon.” Romo v. Amedex Ins. Co., 930 So.2d 643, 650 (Fla. 3d DCA 2006) (citation and quotation omitted). Stated differently: “A party will be estopped from denying liability under the principle of promissory estoppel when the party makes ‘[a] promise which the promisor should reasonably expect to induce action or forbearance of a definite and substantial character on the part of the promisee and which does induce such action or forbearance…[and] injustice can be avoided only by enforcement of the promise.’” Criterion Leasing Group v. Gulf Coast Plastering & Drywall, 582 So.2d 799, 800 (Fla. 1st DCA 1991).

When it comes to insurance coverage, generally, insurance coverage is not created by an estoppel argument.  JN Auto Collection, Corp. v U.S. Security Ins. Co., 59 So.3d 256, 258 (Fla. 3d DCA 2011). However, there is a narrow promissory estoppel exception to prevent injustice or the perpetration of fraud by a misrepresentation.  Id. at 259 (quotation omitted); Kissimmee Utilities Authority v. Florida Municipal Ins. Trust, 686 So.2d766 (Fla. 5th DCA 1997) (“[T]he doctrine of promissory estoppel may be utilized to create insurance coverage when a refusal to do so would sanction fraud or injustice.”).

This promissory estoppel exception to create insurance coverage is a very limited exception. E.L.S.R. Corp. v. Geico General Ins. Co., 183 F.Supp.3d 1273, 1277 (S.D.Fla. 2016). For this reason, a plaintiff must prove this promissory estoppel exception to create insurance coverage with clear and convincing evidence. Id.

Insurance is important. An extension of this is insurance coverage.  What if you receive a denial or declination of coverage or do not have coverage you firmly believed you maintained?  Maybe, just maybe, there is a promissory estoppel argument that can be used to create coverage.  Look, I don’t want to get your hopes up that this is the fallback position anytime an insurer issues a denial or declination of coverage.  It is definitely not, which is why this is a narrow exception and limited remedy.  But this is why working with counsel that understands insurance coverage is a MUST.  If there are facts that can support a promissory estoppel argument with clear and convincing evidence to create coverage you can can prove you thought you maintained, and there was a representation that you maintained such insurance, working with insurance coverage counsel can assist in maximizing this promissory estoppel coverage argument.

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.