In addition to its previously reported surplus lines updates, Florida’s House Bill 301 added a new statute to the Florida Code, Fla. Stat. § 624.1055, which requires any court hearing a liability case to allocate defense costs among all liability insurers who owe a duty to defend the insured against the claim or suit in accordance with the terms of the liability insurance policies. The court is free to use any such equitable factors it determines are appropriate in making an allocation. Any liability insurer entitled to contribution may file an action for contribution in any court of competent jurisdiction.
The statute is meant to prevent insurers from avoiding their duty to share in the defense of an insured. It applies to all liability policies issued in Florida or liability policies issued in other states under which the insurer has a duty to defend an insured in suits or actions filed in Florida. It also applies to any liability policy issued under the Florida Surplus Lines Law.
For any questions regarding Fla. Stat. § 624.1055, or for inquiries regarding the apportionment of costs, please contact Westmont Associates, Inc.