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On February 15, 2022, the Eleventh Circuit filed an unpublished opinion interpreting Florida’s bad faith law arising out of the United States District Court for the Southern District of Florida. Ellis v. GEICO Gen. Ins. Co., No. 21-12159, 2022 U.S. App. LEXIS 4180 (11th Cir. Fla., February 15, 2022). The court affirmed that insurers can be successful in summary judgment where the factual record supports no inference of bad faith. In the underlying matter, Ellis, GEICO’s insured, fled the scene after he was involved in a car accident on September 7, 2014 resulting in the death of a bicyclist. Upon notification, GEICO investigated the subject accident by attempting to contact the Ellis, including presenting to his residence of record, place of work, leaving multiple voicemails, and sending correspondence requesting a response, all to no avail. Upon advice from his personal counsel, Ellis did not communicate with anyone regarding the accident, including GEICO. Ellisalo moved and changed his phone number. GEICO requested the Florida Traffic Crash Report, made available on October 29, 2014, and, upon receipt, confirmed coverage and immediately tendered the full bodily injury limits under Ellis’s policy to the bicyclist’s estate and advised Ellis to seek legal counsel related to a potential excess judgment. Counsel for the cyclist’s estate rejected the policy limit tender by GEICO, alleging it was untimely. Subsequently, the cyclist’s estate obtained a judgment in excess of the policy limits against Ellis.
Following entry of the excess judgment, Ellis filed suit against GEICO alleging bad faith. Upon review of the district court’s grant of summary judgment in favor of GEICO, the Eleventh Circuit panel noted that, ordinarily, bad faith is a question for a jury to consider. Eres v. Progressive Am. Ins. Co., 998 F.3d 1273, 1278 (11th Cir. 2021). However, Florida insurers are under no obligation to tender policy limits in advance of a settlement offer without time for investigation of the facts of the claim as part of the duty is conducting a proper investigation on behalf of its insured. Boston Old Colony Ins. Co. v. Gutierrez, 386 So. 2d 783, 785 (Fla. 1980); De Laune v. Liberty Mut. Ins. Co., 314 So. 2d 601, 603 (Fla. 4th DCA 1975). In the instant case, the Court emphasized that while a question of bad faith is concerned with the actions of the insurer, not the insured, the totality of the circumstances require consideration of the insured’s actions. Berges v. Infinity Ins. Co., 896 So. 2d 665, 680 (Fla. 2004). Specifically, in this case, the record reflected the insured’s complete lack of communication with GEICO as it actively attempted to determine coverage. Bad faith claims may feel inevitable or like an area of weakness for insurers to protect themselves against. However, the best defense in a bad faith claim is the presentation of a strong offense in diligently working on an insured’s behalf to avoid an excess judgment. Harvey v. GEICO Gen. Ins. Co., 259 So. 3d 1, 7 (Fla. 2018). When insurers can present a documented record refuting plaintiff’s bad faith inference, they increase the likelihood of success on summary judgment.
For further assistance or inquiries please contact Jessica Cauley at [email protected], Matt Boyer at [email protected] or FMG’s Insurance Coverage Team for any assistance in understanding and defending bad faith allegations.