A Florida court recently ruled in favor of People’s Trust Insurance Company in a case concerning an insurance appraisal dispute. The court reversed a lower court's decision that denied the insurance company's request to compel appraisal in a property damage claim. This ruling affects the way insurance companies and policyholders handle disputes over damage assessments in the future.
The case, known as People’s Trust Insurance Company v. Cesar Fernandez and Luz Fernandez, was filed in the District Court of Appeal of Florida under docket number 5D2025-3174. The ruling is significant because it clarifies the rights of insurance companies regarding appraisal clauses in their policies.
The dispute began when Cesar and Luz Fernandez filed a claim with People’s Trust Insurance Company on September 8, 2022, for damages sustained to their property in March of that year. Shortly after the claim was filed, the insurance company's estimator inspected the property and concluded that the cost of repairs was $947.51. However, this amount was below the $1,000 deductible that the Fernandez couple had on their policy.
On October 7, 2022, People’s Trust issued a coverage determination letter, stating that it would cover the damage to the roof but not the bathroom ceiling. The letter also noted that the estimated damages were below the deductible, meaning that no repairs or payments would be made unless an agreement was reached on the loss amount or if an appraisal panel determined that the damages exceeded the deductible.
Over two years later, the Fernandez couple obtained a new estimate for repairs, which totaled $149,866.98. They submitted this estimate to the insurance company, which acknowledged receipt but maintained its original position regarding coverage. In response to the couple's notice of intent to initiate litigation, People’s Trust offered a $100 settlement, stating that it did not waive its rights under the insurance policy.
On March 6, 2025, the insurance company closed the claim, prompting the Fernandez couple to file a lawsuit on April 15, 2025, alleging breach of contract. In its response, People’s Trust asserted that the appraisal provision in the policy was the appropriate way to resolve disputes regarding the scope of damages.
On May 27, 2025, People’s Trust filed a Motion to Compel Appraisal, but the Fernandez couple objected, arguing that the insurance company had not invoked the appraisal clause in a timely manner. The trial court agreed and denied the motion, ruling that the insurance company had acted inconsistently with its right to appraisal, thereby waiving that right.
The case then moved to the appellate court, where the judges reviewed the trial court's decision. The court found that the facts were undisputed and that the trial court had made an error in its ruling. The appellate court stated, "We agree with Appellant that the trial court incorrectly determined that Appellant acted inconsistently with its right to appraisal, thereby waiving that right. We therefore reverse and remand for the trial court to compel appraisal."
This ruling is important because it clarifies that an insurance company can invoke appraisal rights even after a lawsuit has been filed. The court referenced previous cases to support its decision, emphasizing that the insurer's actions did not constitute a waiver of its appraisal rights. The judges noted that the insurance company had promptly asserted its right to appraisal after the lawsuit was initiated, which was a critical factor in their decision.
The impact of this ruling extends beyond just this case. It reinforces the rights of insurance companies to seek appraisals in disputes over property damage claims, even after litigation has begun. This could lead to more insurance companies invoking appraisal clauses as a means of resolving disputes, potentially reducing the number of cases that go to trial.
Furthermore, the ruling may influence how policyholders approach their claims. Understanding that insurance companies can still seek appraisals even after a lawsuit is filed may encourage policyholders to negotiate more effectively or consider appraisal as a viable option before resorting to litigation.
Looking ahead, it is unclear whether the Fernandez couple will appeal this ruling. The court's decision is not final until any timely and authorized motions under Florida Rules of Appellate Procedure are resolved. This case may set a precedent for future disputes involving insurance appraisals and could lead to further legal clarifications in this area.