Two new cases were published on August 18, 2021, granting summary judgment for insurers, which identify a few paths toward a viable summary judgment argument. In Nembhard v. Universal Property and Casualty Insurance Co., the Third DCA granted summary judgment based on misrepresentations or omissions made by the homeowners when applying for insurance with UPCI. Nembhard v. Universal Property and Casualty Insurance Co., 46 Fla. L. Weekly D1869b (Fla. 3d DCA 2021). The Court held, an insurance company has the right to rely on an applicant’s representations in an application for insurance and is under no duty to inquire further unless it has actual or constructive knowledge that such representations are incorrect or untrue. Id. This holding applies to instances when the homeowner makes a non-intentional misstatement in an application. Id. The insurer does not need to establish the misrepresentation was intentional. Id. Additionally, the Court held, an insurer has the right to unilaterally rescind an insurance policy on the basis of misrepresentation in the application for insurance. Id.
Nembhard identifies that consideration should be given to pursuing early summary judgment if it can be shown that the homeowners made misrepresentations during the application process. If this misrepresentation affected the insurer’s risk or would have led to non-issuance of the policy, then the misrepresentation is likely material. Making a showing of detrimental reliance by the insurer should lead to a favorable outcome on a Motion for Summary Judgment.
In Certified Priority Restoration v. Universal Insurance Company of North America, summary judgment was granted based on the insurer paying the maximum due under the policy. Certified Priority Restoration v. Universal Insurance Company of North America, 26 Fla. L. Weekly D1865a (Fla. 4th DCA 2021). In Certified Priority Restoration, the homeowners had water damage repairs completed by Certified Priority Restoration. The homeowners assigned the right to recover insurance benefits under the homeowner’s policy to CPR. The insurer moved for summary judgment based on its defense that it paid the maximum amount due under the policy. CPR did not request the insurer, by the manner prescribed in the policy, to allow it to exceed the allowable limit before undertaking the repairs. As such the insurer only paid the allowable limit.
Certified Priority Restoration identifies that one of resolution strategy should be early summary judgment if there is a viable defense that the insurer paid the maximum due under any given policy. Rather than costly lengthy litigation, attempting an early summary judgment motion, under this defense, may be an efficient and successful resolution method.