Most property insurance policies require that the insured notify the insurer of a loss promptly. The timeliness of an insured’s notice is generally treated by courts as a question of law. Determining whether a notice of loss requirement has been satisfied requires establishing when the loss occurred. While losses typically occur on a known date, property damage caused by more gradual processes that may not be apparent to an insured until after damage began can raise more difficult, fact-intensive issues. Analysis of the nature and timing of the damage, along with investigation into the insured’s knowledge of the damage, may be appropriate. Some courts have held that the notice obligation is triggered upon “manifestation” of the loss, namely the date on which the insured could reasonably have concluded the property sustained a loss. See Atl. Cas. Ins. Co. v. Northway Pool Serv., 649 F. Supp. 2d 78, 82 (E.D.N.Y. 2009); Am. Ins. Co. v. Evercare Co., 699 F. Supp. 2d 1361, 1366 (N.D. Ga. 2010). For more on this subject, see the Trigger page of our blog.
Failure to promptly notify an insurer of a loss may constitute grounds for denial of coverage. Some courts have held that untimely notice alone, without a showing of prejudice, is sufficient for denial of coverage. See Bolivar County Bd. of Supervisors v. Forum Ins. Co., 779 F.2d 1081, 1084 (5th Cir. 1986) (under Mississippi law, holding that insurer properly denied coverage based on notice provision absent a showing of prejudice); AMTRAK v. Lexington Ins. Co., 445 F. Supp. 2d 37, 43 (D.D.C. 2006) (holding that actual prejudice is “not a necessary element” of an insurer’s untimely notice defense).
Other courts have, however, held that an untimely notice of loss will not result in forfeiture of coverage unless the insurer was prejudiced as a result of the insured’s delay. See Shell Oil Co. v. Winterthur Swiss Ins. Co., 15 Cal. Rptr. 2d 845 (Cal. App. 1st Dist. 1993) (“California law is settled that a defense based on an insured’s failure to give timely notice requires the insurer to prove that it suffered substantial prejudice.”); Independent Fire Ins. Co. v. NCNB Nat’l Bank, 517 So. 2d 59, 64 (Fla. Dist. Ct. App. 1st Dist. 1987) (requiring insurer to demonstrate prejudice from the insured’s failure to give timely notice); East Texas Medical Center Regional Healthcare System v. Lexington Ins. Co., 575 F.3d 520, 530 (5th Cir. 2009) (holding that insurer must have been prejudiced as a result of insured’s late notice to deny coverage on that ground under Texas law).
We have written on the topic of late notice a number of times. Typical property insurance policies require that the insured notify its carrier of a loss promptly. The purposes of such a provision include allowing an insurer to investigate a claim close in time to the occurrence so as to ensure that it is … Continue Reading
Property insurance policies typically require that, once an insured suffers a loss, the insured report the loss to the insurance carrier promptly. The purpose of such a provision is to allow an insurer to investigate a claim close in time to the occurrence so as to protect itself from fraud, take early control of the … Continue Reading
In insurance fraud cases involving actual or alleged destruction of evidence by the insured, an issue often arises regarding whether an adverse inference instruction is appropriate, and, if so, what form it should take. The Second Circuit recently approved a “light” form of adverse inference instruction that allowed the jury to make an adverse inference … Continue Reading
This case, Hope v. Citizens Property Ins. Co., 2013 Fla. App. LEXIS 8891 (Fla. 3rd DCA, June 5, 2013), addresses the sufficiency of evidence to overcome the presumption of prejudice in the context of a late notice Hurricane Wilma claim. Mr. Hope, the homeowner, sustained damage to his home as the result of Hurricane Wilma … Continue Reading
As we have indicated in prior blog posts on the Soronson, Slominski, and 1500 Coral Towers cases, late notice issues have been cropping up consistently in Florida in the context of Hurricane Wilma claims being reported years after the storm. Although the above-cases were decided by Florida appellate courts, the latest case to address Florida law … Continue Reading
In 1500 Coral Towers Condominium Association, Inc. v. Citizens Property Ins.Co., No. 3D12-132 (3rd DCA April 3, 2013), upon rehearing and de novo review, Florida’s Third District Court of Appeal withdrew its February 6, 2013 late notice ruling (see our analysis of that decision in the February 11 posting), and affirmed the lower court’s grant of … Continue Reading
As we have indicated in prior blog posts on the Soronson and Slominski cases, late notice issues have been cropping up consistently in the Florida appellate courts in the context of Hurricane Wilma claims being reported years after the storm. Cooperation clauses requiring prompt notice and sworn proof of loss are implicated, and the issue, at … Continue Reading
Late notice issues have been cropping up consistently in the Florida appellate courts in the context of Hurricane Wilma claims being reported years after the storm. The latest decision, Slominski v. Citizens Property Ins. Corp., 2012 Fla. App. LEXIS 16730 (Fla. 4th DCA Oct. 3, 2012) attempts to reconcile other recent Fourth District opinions. In Slominski, … Continue Reading
We have seen several recent cases in Florida addressing prompt notice requirements in property policies, many of which are related to Hurricane Wilma claims. This latest decision by the Fourth District Court of Appeal, Leben v. State Farm Florida Ins. Co. 2012 Fla. App. LEXIS 12522 (Aug. 1, 2012) seems to be contrary to the … Continue Reading
Typical property policies require the insured to cooperate with the insurer in the investigation of the claim, and specifically require the insured to submit a sworn proof of loss, provide timely responses to an insurer’s request for documentation related to the claim and, if requested, submit to examinations under oath. If the insured fails to … Continue Reading