Florida Unfair Claims Settlement Practices
The 2020 Florida Statutes
INSURANCE FIELD REPRESENTATIVES AND OPERATIONS
626.9743 Claim settlement practices relating to motor vehicle insurance.
(1) This section shall apply to the adjustment and settlement of personal and commercial motor vehicle
(2) An insurer may not, when liability and damages owed under the policy are reasonably clear, recommend
that a third-party claimant make a claim under his or her own policy solely to avoid paying the claim under the
policy issued by that insurer. However, the insurer may identify options to a third-party claimant relative to the
repair of his or her vehicle.
(3) An insurer that elects to repair a motor vehicle and specifically requires a particular repair shop for vehicle
repairs shall cause the damaged vehicle to be restored to its physical condition as to performance and appearance
immediately prior to the loss at no additional cost to the insured or third-party claimant other than as stated in the
(4) An insurer may not require the use of replacement parts in the repair of a motor vehicle which are not at
least equivalent in kind and quality to the damaged parts prior to the loss in terms of fit, appearance, and
(5) When the insurance policy provides for the adjustment and settlement of first-party motor vehicle total
losses on the basis of actual cash value or replacement with another of like kind and quality, the insurer shall use
one of the following methods:
(a) The insurer may elect a cash settlement based upon the actual cost to purchase a comparable motor
vehicle, including sales tax, if applicable pursuant to subsection (9). Such cost may be derived from:
When comparable motor vehicles are available in the local market area, the cost of two or more such
comparable motor vehicles available within the preceding 90 days;
The retail cost as determined from a generally recognized used motor vehicle industry source such as:
a. An electronic database if the pertinent portions of the valuation documents generated by the database are
provided by the insurer to the first-party insured upon request; or
b. A guidebook that is generally available to the general public if the insurer identifies the guidebook used as
the basis for the retail cost to the first-party insured upon request; or
The retail cost using two or more quotations obtained by the insurer from two or more licensed dealers in
the local market area.
(b) The insurer may elect to offer a replacement motor vehicle that is a specified comparable motor vehicle
available to the insured, including sales tax if applicable pursuant to subsection (9), paid for by the insurer at no
cost other than any deductible provided in the policy and betterment as provided in subsection (6). The offer must
be documented in the insurer’s claim file. For purposes of this subsection, a comparable motor vehicle is one that
is made by the same manufacturer, of the same or newer model year, and of similar body type and that has similar
options and mileage as the insured vehicle. Additionally, a comparable motor vehicle must be in as good or better
overall condition than the insured vehicle and available for inspection within a reasonable distance of the insured’s
(c) When a motor vehicle total loss is adjusted or settled on a basis that varies from the methods described in
paragraph (a) or paragraph (b), the determination of value must be supported by documentation, and any
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deductions from value must be itemized and specified in appropriate dollar amounts. The basis for such settlement
shall be explained to the claimant in writing, if requested, and a copy of the explanation shall be retained in the
insurer’s claim file.
(d) Any other method agreed to by the claimant.
(6) When the amount offered in settlement reflects a reduction by the insurer because of betterment or
depreciation, information pertaining to the reduction shall be maintained with the insurer’s claim file. Deductions
shall be itemized and specific as to dollar amount and shall accurately reflect the value assigned to the betterment
or depreciation. The basis for any deduction shall be explained to the claimant in writing, if requested, and a copy
of the explanation shall be maintained with the insurer’s claim file.
(7) Every insurer shall, if partial losses are settled on the basis of a written estimate prepared by or for the
insurer, supply the insured a copy of the estimate upon which the settlement is based.
(8) Every insurer shall provide notice to an insured before termination of payment for previously authorized
storage charges, and the notice shall provide 72 hours for the insured to remove the vehicle from storage before
terminating payment of the storage charges.
(9) If sales tax will necessarily be incurred by a claimant upon replacement of a total loss or upon repair of a
partial loss, the insurer may defer payment of the sales tax unless and until the obligation has actually been
(10) Nothing in this section shall be construed to authorize or preclude enforcement of policy provisions
relating to settlement disputes.
History.—s. 9, ch. 2004-370; s. 154, ch. 2004-390.