Bad Faith Insurance Claims in Florida: What Qualifies and How to Prove It

An insurance bad faith claim in Florida arises when an insurer fails to settle a claim fairly and honestly despite a clear obligation to pay. Proving it requires showing more than a mistake or simple negligence under Florida Statute 624.155.

Bad faith is one of the most misunderstood areas of Florida insurance law. Policyholders often assume that any denial or lowball offer is bad faith. It isn't. An insurer is allowed to dispute a claim, ask for documentation, and even be wrong about coverage without committing bad faith. The line is crossed when the insurer's conduct becomes unreasonable rather than merely incorrect.

Florida recognizes both a statutory bad faith remedy under Florida Statute § 624.155 and a common-law version, though a policyholder can recover under one or the other, not both. The 2023 tort reform tightened the standard, so what qualified two years ago may not qualify today.

This article explains what counts as bad faith, the required first step before any lawsuit, how the recent reforms changed the rules, and what it takes to prove a claim.

Florida Bad Faith Claims at a Glance

A Florida bad faith claim has several moving parts, from the statutory standard to the mandatory notice and the cure period the insurer gets before suit can be filed.

Element	Requirement	Statute
Standard of conduct	Insurer failed to settle in good faith when it could and should have	§ 624.155(1)(b)
Negligence threshold	Mere negligence alone is not enough	§ 624.155(5)
Required pre-suit step	Civil Remedy Notice filed with DFS and insurer	§ 624.155(3)
Cure period	60 days for the insurer to fix the violation	§ 624.155(3)
Form	Must use the official DFS form	§ 624.155(3)(b)
Statute of limitations	Generally 5 years from the bad faith conduct	§ 95.11
Possible damages	Extra-contractual, consequential, interest, sometimes punitive	§ 624.155

What Counts as Bad Faith Under Florida Law

Statutory bad faith centers on one core idea: the insurer did not attempt in good faith to settle the claim when, under all the circumstances, it could and should have done so while acting fairly toward the insured.

That language comes straight from section 624.155(1)(b)(1). Florida courts have built on it for decades. Conduct that can support a bad faith claim includes unreasonable delay in paying a clearly covered loss, denying a claim without a reasonable investigation, shifting or inventing reasons for denial, or making an offer far below what the evidence supports.

What does not qualify is just as important. A genuine coverage dispute, a reasonable request for documentation, or an honest valuation disagreement is not bad faith, even if the insurer turns out to be wrong. The insurer's reasoning has to be unreasonable, not simply mistaken.

First-Party vs. Third-Party Bad Faith

Florida draws a distinction between bad faith claims a policyholder brings against their own insurer and bad faith claims that arise when an insurer mishandles a liability claim brought by someone else.

First-party bad faith happens when your own property insurer mishandles your claim, such as delaying payment on covered hurricane or water damage. In Florida, first-party bad faith exists because of section 624.155, not common law, so the statutory process must be followed exactly.

Third-party bad faith arises when a liability insurer fails to protect its insured from a judgment that exceeds policy limits, often by refusing a reasonable settlement. These claims trace back to long-standing Florida case law on the duty insurers owe their insureds.

Property owners disputing a denied or underpaid claim are almost always dealing with first-party bad faith, which makes the Civil Remedy Notice the critical gateway.

The Civil Remedy Notice: A Required First Step

Before filing any statutory bad faith lawsuit, the policyholder must serve a Civil Remedy Notice on both the insurer and the Department of Financial Services, then wait 60 days for the insurer to cure the violation.

This requirement is a condition precedent under section 624.155(3). Skip it and the bad faith claim cannot proceed. The notice has to be filed on the official Department of Financial Services form, and it must state the specific facts and the statutory provisions the insurer allegedly violated. A vague notice can be rejected for lack of specificity, which restarts the clock.

The 60-day window is the insurer's chance to pay the claim or correct the conduct. If the insurer pays within those 60 days, the bad faith claim usually goes away. If it doesn't, the policyholder may then file suit. That structure is deliberate. The Civil Remedy Notice gives the insurer a final opportunity to do the right thing before facing extra-contractual exposure.

How the 2023 Reforms Changed Bad Faith Claims

House Bill 837, signed in March 2023, added new provisions to section 624.155 that raised the bar for proving bad faith and gave insurers new defenses.

Negligence alone is no longer enough. The reform codified what Florida courts had said for years: mere negligence does not constitute bad faith. A policyholder now has to point to conduct that goes beyond a careless error.

Policyholders owe a duty of good faith too. The amended statute imposes a good-faith obligation on the insured, the claimant, and their representatives. If a policyholder acts in bad faith, a court can reduce the damages awarded. That means how the claim is presented and documented now matters to the outcome.

Insurers got a safe harbor on liability claims. For liability claims, an insurer that tenders the lesser of the policy limits or the amount demanded within 90 days of receiving notice, along with supporting evidence, can avoid a bad faith action. The tender itself isn't admissible later as proof of bad faith.

The practical effect is that bad faith claims are harder to win than they were before 2023, and clean documentation on the policyholder's side carries more weight than ever.

What You Can Recover in a Bad Faith Claim

A successful bad faith claim can recover more than the policy benefits, including consequential damages caused by the insurer's conduct and, in rare cases, punitive damages.

• The policy benefits owed. The amount the insurer should have paid on the underlying claim.
• Consequential damages. Losses caused by the delay or denial, such as additional repair costs or extra living expenses that piled up while the insurer sat on the claim.
• Interest. On amounts the insurer wrongly withheld.
• Punitive damages. Available only for egregious conduct, and difficult to obtain, but possible in the worst cases.

How to Prove Bad Faith

Proving bad faith comes down to building a record that shows the insurer acted unreasonably, not just incorrectly, with the underlying claim and damages clearly established first.

In most first-party cases, the coverage and the amount owed have to be resolved in the policyholder's favor before a bad faith claim can move forward. Once that's established, the focus shifts to the insurer's conduct. The evidence that matters most is documentation.

• The claim file timeline. Dates the insurer received notice, inspected, communicated, and paid or denied, measured against the deadlines Florida law imposes on insurers.
• Written communications. Letters and emails that show shifting reasons, ignored evidence, or unexplained delay.
• The insurer's own estimate versus the actual loss. A large gap, especially when later litigation recovers far more, can show the first offer was unreasonable.
• Expert support. Engineers, contractors, or appraisers who establish the true scope of the loss and what a reasonable insurer should have paid.

Common Mistakes in Florida Bad Faith Claims

Treating every denial as bad faith is the most frequent misstep, but procedural errors sink just as many claims.

Skipping or botching the Civil Remedy Notice. The notice is mandatory and must be specific. A defective notice can bar the claim or reset the timeline.

Filing before the underlying claim is resolved. A bad faith claim generally can't succeed until coverage and the amount owed are established. Jumping ahead wastes the effort.

Confusing a coverage dispute with bad faith. An insurer that reasonably disputes whether a loss is covered isn't acting in bad faith, even if a court later disagrees.

Poor documentation on the policyholder's side. Since 2023, an insured's own conduct can reduce damages. Sloppy or incomplete claim submissions can be used against you.

Frequently Asked Questions

Is every denied claim a bad faith claim in Florida?

No. An insurer is allowed to deny or dispute a claim as long as its position is reasonable. Bad faith requires unreasonable conduct, such as ignoring evidence, delaying without justification, or inventing reasons to avoid payment. A reasonable but ultimately incorrect denial is not bad faith.

Do I have to file a Civil Remedy Notice before suing for bad faith?

Yes, for statutory bad faith. The Civil Remedy Notice is a condition precedent under section 624.155. It must be filed with the Department of Financial Services and the insurer on the official form, and the insurer gets 60 days to cure before a lawsuit can be filed.

How long do I have to bring a bad faith claim in Florida?

Bad faith claims generally must be brought within five years of the conduct that gave rise to the claim. The underlying claim usually needs to be resolved first, and the Civil Remedy Notice process adds time, so it's wise not to wait.

Did the 2023 reforms make bad faith claims harder to win?

In general, yes. House Bill 837 codified that mere negligence isn't bad faith, imposed a good-faith duty on policyholders that can reduce their damages, and gave insurers a safe harbor on certain liability claims. Strong documentation matters more now than it did before.

Can I recover more than my policy limits in a bad faith case?

Yes. That's one of the main reasons bad faith claims exist. A successful claim can recover consequential damages and interest beyond the policy limits, and in egregious cases punitive damages, though punitive awards are uncommon and hard to obtain.

Hold Your Insurer to the Standard the Law Requires

Bad faith claims are powerful but technical. The standard is high, the Civil Remedy Notice is unforgiving, and the 2023 reforms shifted the rules in the insurer's favor. Property owners who suspect their insurer crossed the line from wrong to unreasonable should have the file reviewed before deadlines and procedural traps close off the option.

Cernitz Law represents Florida homeowners and commercial property owners facing denied and underpaid insurance claims. The firm's attorneys previously represented insurance companies, giving them direct insight into how insurers evaluate and dispute claims. With more than million recovered for clients across thousands of cases, Cernitz Law handles property damage claims involving hurricanes, fire, water damage, structural collapse, vandalism, and more. Contact us to learn more.