February 5, 2025

Strategic Defense Results in Zero-Dollar Arbitration Award for Insurance Carrier

In a significant victory for the defense, Kelley Kronenberg Partner/Business Unit Leader Alison Trejo and Partner Alan Swindoll successfully defended an insurance carrier against a substantial Hurricane Ian property damage claim in Lee County, Florida. The case centered on a nearly $500,000.00 claim filed by the insured, who alleged extensive storm-related damages to their property. 

Alison and Alan effectively demonstrated several critical points that ultimately led to their success. First, they established that the policy in question was an Actual Cash Value (ACV) policy, yet the plaintiff never submitted an ACV estimate prior to filing suit, instead presenting only a Replacement Cost Value estimate through their public adjuster. Additionally, the defense successfully argued that certain claimed damages, including those to a boat dock, were excluded as flood damage under the policy terms. 

A thorough engineering investigation revealed that the property’s roof was at the end of its life span, with only 12 tiles sustaining repairable storm-related damage. The engineer’s report also confirmed that interior damages resulted from pre-existing conditions, specifically long-standing leaks from flashing failures, rather than hurricane damage. 

Following a non-binding arbitration hearing on January 27, 2025, the arbitrator found in favor of the defendant carrier, determining there was no breach of contract in the investigation and handling of the claim. This ruling effectively validated the carrier’s initial position and claims handling, which had included a payment of approximately $8,745.98 for covered damages after accounting for depreciation and the applicable deductible. 

This outcome represents a complete defense victory and underscores the importance of proper policy interpretation in insurance defense litigation. 

For additional successes and details about our first-party property insurance defense practice, click here.

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