Legal Question in Insurance Law in Florida

Requirement of timely notice

Generally, yes. Insurance policies typically require timely notice of claims as a requirement of coverage. Failure to provide such notice may result in the insurance company (a/k/a insurer)denying coverage if it can show that its lack of notice was prejudicial to its ability to defend. Therefore, it is important to advise the insurer of a suit or a potential suit. The purpose of liability insurance is to protect you against losses due to third party claims(i.e. claims from parties other than those insured under your policy)even if you believe the claims are frivolous. In many instances, the most important feature of an insurance policy is the insurer's duty to defend and provide you an attorney, if needed, at the insurer's expense. It is true that numerous claims may result in higher premiums or an insurer's decision not to renew a policy, and some policy holders choose to pay certain claims out-of-pocket. However, this can be a dangerous practice especially if the policy holder fails to obtain an adequate release of claim and/or there is pending litigation that has not been addressed. Failure to adequately resolve claims may result in siginificant losses, and it is often better to risk policy non-renewal or increased premiums than be held personally liable for the payment of losses. Lastly, Floridians should be aware that in the event of policy non-renewal they may be able to obtain coverage through the state's high risk insurance program.