Florida Middle District Declines to Compel Appraisal in Homeowner’s Insurance Case Due to Existence of Coverage Dispute

By Kelly M. Vogt

In Petit v. Clear Blue Ins. Co., 2024 U.S. Dist. LEXIS 128982, Case No. 6:24-cv-564-ACC-LHP (M.D. Fla. July 22, 2024), the plaintiff homeowner filed a lawsuit against Clear Blue Insurance Company seeking to recover homeowner’s insurance benefits for damages allegedly sustained during Hurricane Ian. The plaintiff claimed that the insured property, located in Palm Bay, Florida, was covered under an insurance policy issued by Clear Blue. While the alleged damages occurred on September 29, 2022, the plaintiff did not report the damage to Clear Blue until December 21, 2022, eighty-three days after the date of loss. Clear Blue’s adjuster assessed the covered damage at $7,032.05, whereas the plaintiff sought $89,985.32.

Clear Blue sent a Reservation of Rights to the plaintiff, noting that the late reporting might have prejudiced the claim decision. Subsequently, Clear Blue issued a coverage determination letter, explaining that $2,088.05 was owed after applying the hurricane deductible. The plaintiff filed a complaint alleging a breach of contract due to Clear Blue’s refusal to pay the full amount of the claim. The case was removed to federal court based on diversity jurisdiction under 28 U.S.C. § 1332.

The plaintiff then moved to compel appraisal and to stay or extend deadlines pending the appraisal. Clear Blue opposed the motion, arguing that appraisal was premature due to the plaintiff’s failure to provide timely notice, a post-loss obligation under the policy. The court emphasized that compliance with post-loss obligations is essential before compelling appraisal. Given the disputed facts regarding the timeliness of the plaintiff’s notice, the court denied the motion, determining that the appraisal request was not ripe and that the delays in notification raised genuine issues of material fact.

The court also denied the plaintiff’s request to stay or extend deadlines, citing a lack of good cause in adherence to Rule 16(b)(4) of the Federal Rules of Civil Procedure. The decision reinforced the necessity for insured parties to comply with all policy conditions and procedural requirements to secure their rights to appraisal or other remedies under the insurance contract.