The House and Senate have been in regular communication and negotiations to move each chamber’s bill forward concurrently. While each chamber thus far has adopted varying language, as of this week, the bills have begun to narrow and mirror each other substantially. Specifically, each chamber’s bill has identical portions regarding bad faith and attorney’s fees.

Fla. Stat.  624.155 – bad faith provisions
The proposed changes state an insurer cannot be liable for bad faith with respect to a liability insurance claim if the insurer tenders the lesser of the policy limits or the amount demanded by the client within a certain period of time after receiving notice of the claim. Both chambers have agreed that this time period will be set at 90 days.

Additionally, the bills also would change Fla. Stat. 624.155 to state that negligence alone is insufficient to constitute bad faith, that a court can adjust a damages award if a third-party claimant or insured does not act in good faith, and that an insurer does not commit bad faith by failing to pay multiple competing claims arising out of one accident—even if those claims’ total exceeds the policy limits—so long as the insurer within 90 days either files an interpleader action or makes the full policy limits available before an arbitrator is selected.

Fla. Statutes 627.428 and 626.9373 – Attorney’s Fees
The proposed changes would fully repeal both of these statutes. However, they create a new section to Chapter 86, Fla. Stat., which creates a right of action for declaratory relief to determine insurance coverage only after denial of a claim.

• In doing so, the court shall award attorneys fees to the named insured, omnibus insured, or named beneficiary under the policy at issue upon rendition of a declaratory judgment in their favor.
• Additionally, this right would not be transferrable, assignable, or acquired by any other manner by anyone other than a named or omnibus insured or a named beneficiary.
• Explicitly stating that a defense by insurer of reservation of rights does not constitute denial of claim.

Enactment
These changes would only effect prospective claims arising after the enactment date.