Florida House Committee Nixes Insurer Bad Faith Reform

On January 26, 2012, the Florida House of Representatives Civil Justice Subcommittee, in an 8-7 vote, killed HB 427, which would have amended section 624.155, Florida Statutes, dealing with insurer bad faith. The Senate version of the bill, SB 1224, has not yet been acted on by any committees, but it appears likely that, at least for 2012, legislative efforts to reform insurer bad faith have been dealt a devastating, if not fatal, blow.

The defeat of HB 427 serves to underscore the importance, from the insurer’s perspective, of removing, where possible, bad faith cases to federal court. There, judges have become increasingly antipathetic to bad-faith “set ups.” A growing body of federal case law reflects a willingness on the part of the courts to grant summary judgment in the insurer’s favor where it made genuine efforts to settle claims within policy limits, but where those efforts were foiled by perceived machinations on the part of the claimant’s counsel.