In North Pointe Insurance Company v. Thomas, _____ So.3rd _____ (Fla. 3rd DCA August 26, 2009), the insured homeowners filed a claim with their homeowner’s carrier for damage to a tile floor caused when a pot was dropped on the floor.  The insurer denied the claim.  The insureds hired counsel who filed a Petition to Compel Appraisal.  At that point, the insurer withdrew its coverage denial and consented to appraisal.  The appraisal resulted in an award in favor of the insureds in the amount of $115,899.52 (That’s some tile floor.  But, when one tile is broken, all contiguous tiles must be replaced by the insurer if they can’t be matched with the new tile). 

The insureds then moved to have the appraisal award confirmed, and sought prejudgment interest from the date of the loss.  The insurer claimed that, under its policy, it was only responsible for prejudgment interest if if failed to pay the claim within 60 days of the appraisal award. 

The 3rd DCA recognized that, generally, interest on a loss payable under an insurance policy is recoverable only from the date the payment is due under the terms of the policy.  However, an exception exists where the insurer initially denies coverage and later either acknowledges coverage or coverage is determined by a court.  "Once the insurer denies coverage, it is deemed to have waived its policy provision for deferred payment and, should it pay, becomes responsible for prejudgment interest from the date of loss.  ‘[I]f the insurer denies liability, interest begins to run from the date of loss, even where the policy provides for payment at a later date.’"  Citing, Independent Fire Insurance Company v. Lugassy, 593 So.2d 570, 572 (Fla. 3rd DCA 1992).