Homeowners Choice Prop. & Cas. Ins. Co. v. Clark, 50 Fla. L. Weekly D648 (Fla. 1st DCA March 19, 2025) is an instructive, fact-intensive case identifying and analyzing an insured’s duties after loss, including providing prompt notice, repairing property, maintaining records and receipts and submitting an Actual Cash Value (ACV) estimate in a first party property action. The insured plaintiffs, Thomas and Rebecca Clark, were awarded $541,257 after a jury trial. The jury awarded that sum based on a Replacement Cost Value (RCV) calculation of the damage to the Clark’s property. On appeal, the verdict was reversed.
This matter arose from a Hurricane Sally claim on September 16, 2020. The hurricane damaged the Clarks’ property which they used as a vacation and rental property. Damage included the property’s roof and siding which led to a water leakage in the dwelling. On September 16, 2020, the Clarks filed a claim with Homeowners Choice for “water coming in the house,” adding that “the roof was gone, [and] the siding had been blown off.” Homeowners Choice sent a letter acknowledging receipt of the claim two days later and specified that the Clarks had to “make any reasonable and necessary repairs” to “protect [the] property from further damage” and asked that they “[k]eep an accurate record of the repair expenses including any invoices or receipts.” The letter also attached a “Personal Property Loss Inventory Form” for the Clarks to fill out if any personal property was damaged due to the Hurricane.
Within a month, Homeowners Choice sent an independent adjuster (IA) to inspect the dwelling for damage and to prepare an estimate of the incurred loss. The IA estimated that the incurred loss was $76,634.09, based on an ACV calculation, which is (RCV) minus depreciation. Two days later, after the IA prepared his estimate, Homeowners Choice sent the Clarks another letter informing them of the estimated incurred loss and a check for $59,656.13 (the incurred loss minus the policy deductible and recoverable depreciation). That letter also provided that if the Clarks “during the course of the repairs” discovered “any hidden or additional damage that may impact the amount of loss” they had to contact Homeowners Choice immediately “so that they could determine whether an additional inspection of the loss was required.” The Clarks cashed the check and use the funds to pay for the roofing and siding repairs, but they never provided receipts or invoices for the repairs to Homeowners Choice.
Sometime after receiving the check from Homeowners Choice, the Clarks hired a public adjuster (PA). After visits to the property, the PA prepared his own estimate, which indicated a $440,093.90 ACV loss for the dwelling. However, the same figures were provided for ACV and RCV with no value for depreciation. The PA also prepared an estimate calculating the Clarks’ personal property loss at $57,684 with an attached inventory – not the one provided by Homeowners Choice – that did not distinguish between the RCV and ACV of the personal property. Around the same time, the PA also prepared an estimate for the fair rental value lost ($43,479.23). This estimate provided no value for the normal expenses associated with the rental of the dwelling.
Eventually, three estimates were sent to Homeowners Choice with a sworn proof of loss signed by the Clarks which attested under oath as to the final figure ($541,257.13). It was unclear when this was done, but Homeowners Choice recognized receipt of the estimate and sworn proof of loss in a letter sent to the Clarks on July 16, 2021, which stated that they disagreed with the estimated amount and “the scope of damages related to” the loss. Homeowners Choice then reinspected the roof, exterior and the interior, for cause and duration. The parties never reached agreement as to the scope of the original loss caused by the hurricane, which resulted in the underlying action for breach of the insurance contract.
Before filing the lawsuit, the Clarks never contracted mitigation services to reduce the growth of mold in the dwelling, nor did they conduct any work on the property other than the roofing and siding. Nonetheless, the public adjusters estimate included upgrades to the dwelling.
The case went to trial. Homeowners Choice moved for a directed verdict on the ground that the Clarks failed to provide evidence that they actually incurred a greater loss than that what was paid. The trial court denied the motion and the jury returned a verdict in favor of the Clarks for substantially the full amount listed in their sworn proof of loss. Homeowners Choice later renewed its motion for directed verdict, or in the alternative moved for a new trial that was denied. This appeal before the First District Court of Appeal followed.
On appeal, Homeowners Choice asserted that the Clarks failed to show at trial that a breach of the insurance policy occurred. Homeowners Choice maintained that the Clarks failed to meet certain conditions required by the policy – removing its obligation to pay the Clarks’ claim. Homeowners Choice argued that the trial court should have granted its motion for directed verdict.
The First District first assessed the relevant coverages under the policy, Coverage A – Dwelling, Coverage C – Personal Property and Coverage D – Fair Rental Value. The court noted that to obtain these coverages, the Clarks had certain conditions that had to be met. Specifically, the Clarks had to “give prompt notice to” the insurer and “make reasonable and necessary repairs to protect the property”, “keep an accurate record of repair expenses” and “prepare an inventory of damaged personal property showing the quantity, description, actual cash value and amount of loss and attach all bills, receipts and related documents that justify the figures in the inventory”. The court analyzed whether the Clarks presented evidence at trial to determine if these conditions were met. If these conditions precedent were not met, then Homeowners Choice was justified in not paying the Clarks’ alleged loss.
Duty to Provide Notice
The court found that it was undisputed that the Clarks provided prompt notice to Homeowners Choice of the property damage to the dwelling, covered under Coverage A.
However, as for personal property, covered in Coverage C, the record showed through the Clarks’ own testimony, that they did not provide the list of personal property lost due to the Hurricane to Homeowners Choice promptly. The estimate prepared by the PA, with the list supplied by Ms. Clark, was dated April 13, 2021. There was no testimony that this estimate was provided to Homeowners Choice before the lawsuit was filed. Evidence of Homeowners Choice receipt of the personal property list reflected receipt on July 16, 2021 – well after the September 2020 claim was filed. The court noted that even if they took the date of notification under Coverage C, it had been 10 months since the Hurricane. Because Homeowners Choice notified the Clarks two days after the Hurricane that they had to provide such information, the court concluded that notice provided 10 months after the Hurricane was not “prompt.” The evidence showed that the Clarks did not comply with that condition precedent which affected the insurer’s obligation to pay on the policy under Coverage C. As to the claim for fair rental value provided under Coverage D, the court reached the same conclusion: that the Clarks’ notice was not “prompt”.
The court found that the Clarks provided no evidence to rebut the presumption that Homeowners Choice was not prejudiced by the Clarks’ noncompliance with the notice provision. The Clarks provided no evidence as to why personal property or fair rental value estimates were not provided to Homeowners Choice sooner, nor were receipts or other documentation justifying the estimated “losses” provided. Accordingly, the court found that the presumption of prejudice for failing to provide prompt notice was not rebutted by the Clarks and Homeowners Choice was under no obligation to make payments under the claim for damage to personal property and loss rental value.
Duty to Protect Property
The court also considered whether the Clarks “made reasonable and necessary repairs to protect the property” as required by the policy after the hurricane hit. The evidence showed the Clarks did not meet this duty. Although the Clarks did act quickly to tarp the dwelling, it took them five to six months from when Homeowners Choice paid them on their initial claim to have the roof and siding of the dwelling replaced. The Clarks also admitted that no work, besides on the roof and siding, had been done on the home since the hurricane. The Clarks testified that the property had been “boarded up” and “sitting.” The court concluded that the Clarks did not take necessary steps to protect the property from further damage, removing the obligation for Homeowners Choice to pay under the policy.
Duty to Repair
As with protection, the Clarks also substantially failed to repair the dwelling to protect it from further damage.
Duty to Maintain Records and Receipts
On appeal, the record also showed that the Clarks did not substantially comply with post-loss conditions that required them to keep an accurate record of receipts, payments or other documents showing their expenditures due to the loss caused by the hurricane. The Clarks and the public adjuster all testified no receipts were kept – other than those for the roofing and siding – nor provided to Homeowners Choice before or after the litigation was initiated. Moreover, the only receipts the Clarks did have, the roofing and siding, were not provided to Homeowners Choice until after the underlying action was initiated. Homeowners Choice was not required to pay the purported claims because the Clarks never provided proof that the costs were incurred or required payment. Indeed, the Clarks submitted that no work was done aside from the roof and siding, which they were compensated for by Homeowners Choice.
The First District Court of Appeal then analyzed the differences between ACV and RCV with respect to each disputed coverage category which further demonstrated why Homeowners Choice was entitled to a directed verdict.
Coverage C – Personal Property
As to Coverage C for personal property, instead of providing Homeowners Choice with a claim for the loss of personal property at the time of the covered peril, the Clarks provided a list of personal property damaged or destroyed by the hurricane 10 months later – after mold growth had spread to several additional areas of the dwelling. The court found that the ACV at the time of loss, under the circumstances, could not be determined. The Clarks estimated the personal property loss of $57,684. Attached to their estimate was a list of personal property allegedly damaged or destroyed. That list included 89 items and purported prices for each, but no receipts or proof of ACV for those items was ever provided. For example, the Clarks claim $9,795 as loss for linens, sheets and pillows that they replaced. But there was no proof of the ACV of those items, or when they were replaced was ever provided. Similarly, Mrs. Clark testified that she replaced “two sofa beds that mice had chewed up and 6 chairs that mice had destroyed”. Those items were never claimed on the list of personal property, nor did the Clarks ever provide proof of that cost. Likewise, the PA admitted that the Clarks’ washer was fully functional and yet it was claimed as a loss on the personal property inventory. No evidence in the record showed that the Clarks provided Homeowners Choice with the ACV of the personal property lost due to the hurricane. Also, the Clarks did not use the “Personal Property Loss Inventory Form” provided by Homeowners Choice, which provided for the original cost of the property, its RCV and ACV, but rather a spreadsheet with the name of the item, the quantity and amount they claimed as the ACV. To properly request the ACV of their personal property, the Clarks had to provide Homeowners Choice with the RCV of the items and the appropriate allocated depreciation for that item. Because that did not occur and because a jury could not speculate what the depreciation would have been, the court ruled that Homeowners Choice was entitled to a directed verdict as to the claimed Coverage C damages.
Coverage D – Fair Rental Value
As to Coverage D, for fair rental value, the Clarks claim did not account for the calculations required under the policy but merely provided a summary for how much rental income the Clarks made in 2019. The rental income did not provide evidence of expenses as required by the policy. Without evidence of the proper expenses that should be deducted, the First District found that a reasonable jury could not reach a verdict that the Clarks were entitled to the requested fair rental value loss in their sworn proof of loss and PA’s estimate. Thus, Homeowners Choice was entitled to a directed verdict as to Coverage D.
Coverage A – Dwelling
As to Coverage A, for “Dwelling,” the court assessed each of the loss settlement provisions under Coverage A of the policy. The court noted that the Clarks contended that the payment of $59,656.13 was insufficient ACV for the loss claimed. The court noted that Florida Statute Section 627.7011 (3)(a) places the initial burden on the insurer to show that it paid “at least the actual cash value of the insured loss.” Once the insurer provides an ACV estimate and pays the estimate sum, the burden shifts to the insured to demonstrate that the payment did not reflect the fully insured loss. The disagreement between the parties as to the scope and extent of damage is resolved by a factfinder. The court, however, found that the Clarks provided no evidence that can support a disagreement as to ACV (since no ACV estimate was provided by the Clarks) and therefore a factfinder could not conclude which of the two amounts would be correct. Accordingly, the First District found there was insufficient evidence presented at trial for reasonable jury to conclude that Homeowners Choice breached the policy where the Clarks cannot and did not show that Homeowners Choice was liable for the RCV of the damage caused by the hurricane, thus a directed verdict should have been granted.
The First District Court of Appeal therefore, reversed the jury verdict and remanded the case for further proceedings consistent with its opinion.
Original source can be found here.