American Property Casualty Insurance Association

Bad Faith


“Bad Faith” actions provide for underinsured/uninsured motorist coverage, for when an insured individual seeks coverage from their own carrier due to another driver’s inadequate coverage.

Florida is a third-party bad-faith state, which means that insured drivers are exposed to excess liability. This particular legal environment has led to billions of dollars in additional claims—$7.6 billion over the last 12 years, according to one study.

While more needs to be done, this year Florida took a positive step to address this problem. House Bill 301, an “omnibus” bill that addressed a number of insurance issues, contained a provision that may help reduce or delay “bad faith” litigation in some residential property insurance claims when appraisal has been invoked.

There is more work to be done, as this is a large and complex problem.