Brown & Brown, Inc. v. Estate of Edenfield, (Fla. 1st DCA 2010)
An insurance broker appealed a judgment of $850,000 for negligently creating a “gap” in coverage under a $1M professional liability policy issued to a nursing home. A patient at the nursing home died from injuries sustained on the premises in June 2001. The home’s non-renewing, “claims-made” policy expired on September 15, 2001, the home purportedly made a claim on September 17, 2001, and the new policy secured by the home’s broker did not take effect until November 1, 2001. The insurer did not defend the nursing home in the action by the estate and the home eventually settled with the estate for $1M and assignment of any claims against the insurer and insurance broker. It was noted that the insurer did not give the 45 days advance written notice of nonrenewal as required by Fla. Stat. § 626.9201.
The insurer settled with the estate for $150,000. In pursuing its claims against the broker, the trial court awarded the estate the remaining $850,000 of the policy because the broker created a “gap” in coverage during which the claim was made. On appeal, the court held that under Fla. Stat. § 626.9201, the failure of the insurer to provide the 45 days nonrenewal notice resulted in coverage being extended for an additional 45 days. As such, the court reversed because the broker’s failure to procure subsequent coverage until November 1, 2001 did not create a gap in coverage.
Florida Insurance Coverage Law 