Mold Claim Denials: Property Insurance Guide for Hollywood, FL

Introduction: Mold Damage Risks for Hollywood Homeowners

Hollywood, Florida sits between the Atlantic Ocean and the Everglades, giving residents equal parts sea breeze and subtropical humidity. That humidity—combined with hurricane-season rain—creates ideal conditions for household mold. Broward County’s history of storm surge and high groundwater elevates the risk even in homes outside FEMA’s Special Flood Hazard Areas. When mold appears after a burst pipe, roof leak, or storm, most homeowners turn to property insurance to cover remediation costs, relocation expenses, and repairs. Yet insurers often deny mold claims, leaving Hollywood homeowners scrambling for answers. This guide explains how Florida law treats mold damage claims, why carriers deny them, and how policyholders can respond effectively while protecting their rights.

Understanding Your Rights in Florida

Mold Coverage Hinges on Policy Language

Unlike windstorm or fire losses, mold is typically a limited peril in Florida property insurance policies. Insurers often cap mold remediation at $10,000 unless the mold results from a covered peril, such as a sudden and accidental pipe break. Always review the Water Damage Exclusion and the Limited Fungi, Wet or Dry Rot, or Bacteria Coverage Endorsement in your contract.

Key Statutory Rights

• Prompt Acknowledgment and Payment: Florida Statute § 627.70131(7)(a) requires insurers to pay or deny a property claim within 90 days after receiving notice, unless factors beyond their control prevent a decision.

• Good-Faith Claims Handling: Under Florida Statute § 624.155(1)(b), you may bring a civil action if an insurer fails to settle a claim in good faith when it could and should have done so had it acted fairly and honestly toward its insured.

• 5-Year Contract Suit Limitation: Pursuant to Florida Statute § 95.11(2)(b), actions based on written insurance contracts must be filed within five years from the date the insurer breaches the policy (often marked by a partial or complete denial).

Florida’s Valued Policy Law Does Not Apply to Mold Many homeowners mistakenly believe Florida’s Valued Policy Law (Fla. Stat. § 627.702) entitles them to policy limits after a total loss. That statute only applies to covered perils that destroy the entire structure, such as fire or hurricane—not progressive mold damage.

Common Reasons Property Insurance Companies Deny Mold Claims in Florida

• Gradual or Long-Term Damage: Policies often exclude mold arising from seepage or leakage over a period of 14 days or more. If an insurer’s adjuster alleges you failed to detect or fix a leak promptly, expect a denial citing owner negligence.

• Capped Mold Sublimits Exceeded: Even when carrier liability is acknowledged, the insurer may point to a $10,000 mold sublimit endorsement and refuse additional payment for reconstruction or contents.

• Late Notice: Under Fla. Stat. § 627.70132, you generally must report a claim for property damage within two years of the date of loss. Insurers argue that delayed reporting impairs their ability to investigate.

• Non-Covered Source of Moisture: Mold stemming from ground water, tidal surge, or plumbing wear-and-tear often falls under exclusions for flood or repeated seepage.

• Improper Remediation: If homeowners remove drywall before the insurer inspects, carriers may claim spoliation of evidence and deny for failure to protect the property under the policy’s Duties After Loss.

Florida Legal Protections & Regulations

Statutory Deadlines and Notice Requirements

Florida’s 90-day decision deadline (Fla. Stat. § 627.70131) and the new time-bar on reporting property claims (Fla. Stat. § 627.70132) create a tight evidentiary window. Hollywood homeowners must photograph, video, and, if possible, obtain a licensed mold assessor’s report immediately after discovering damage.

Bad Faith Standard

Florida courts apply a two-part test when evaluating bad faith under § 624.155: (1) whether the insurer breached the policy, and (2) whether that breach was committed unreasonably. In Johnson v. Omega Ins. Co., 200 So.3d 1207 (Fla. 2016), the Florida Supreme Court held that an insurer can be found in bad faith even when it eventually pays the claim—if the delay was unreasonable. Mold claims often hinge on the timeliness of inspection and payment because mold spreads quickly.

Assignment of Benefits (AOB)

Legislative reforms in 2023 (Fla. Stat. § 627.7152) severely restrict AOB agreements. Homeowners may still assign post-loss benefits to licensed mold remediators, but strict form requirements and a 14-day rescission period apply. Failure to follow the statute can void the AOB, leaving the homeowner solely responsible for the bill.

Florida Administrative Code (FAC) Rule 69B-220

This rule governs public adjusters. Section 69B-220.051(4) requires public adjusters to advise insureds that they can contact the Florida Department of Financial Services (DFS) if they have a dispute. Understanding this regulation helps homeowners choose qualified representation.

Steps to Take After a Denial in Florida

1. Request a Written Explanation

Carriers must provide the basis for denial in writing, including policy language relied upon. This is required by Fla. Stat. § 626.9541(1)(i)3.f.

2. Inspect and Preserve Evidence

• Obtain an independent mold assessment by a Florida-licensed mold assessor (Fla. Stat. §§ 468.8411–468.8419).

• Keep damaged drywall, wood, and carpet samples in sealed bags if safe.

• Document relative humidity readings and HVAC settings to counter allegations of neglect.

3. File a Notice of Intent to Initiate Litigation (NOI)

Since July 2021, § 627.70152 requires policyholders to submit an NOI to the insurer at least 10 business days before filing suit. The notice must include an estimate of damages prepared by a licensed contractor or public adjuster.

4. Use the DFS Mediation or Appraisal Programs

The DFS Residential Property Mediation Program offers a free, nonbinding conference with a neutral mediator. Hollywood homeowners may request mediation within 60 days of a denial or partial payment. If your policy has an appraisal clause, you may invoke it instead; however, recent case law (State Farm Fla. Ins. Co. v. Parrish, 312 So.3d 145 (Fla. 2d DCA 2021)) confirms you must still comply with the NOI statute before litigation.

5. Track Deadlines

The five-year statute of limitations (Fla. Stat. § 95.11(2)(b)) continues to run while mediation or appraisal is pending. Mark your calendar to preserve your right to sue.

When to Seek Legal Help in Florida

Complex Denials and Coverage Disputes

If the denial cites multiple exclusions—water damage, mold sublimits, constant or repeated seepage—an experienced Florida attorney can parse the interplay of policy provisions.

Suspected Bad Faith

Indicators include:

• Unreasonable delay beyond 90 days without explanation.

• Repeated requests for documents already provided.

• Dramatically low settlement offers unsupported by estimates.

A qualified lawyer can file a Civil Remedy Notice (CRN) under § 624.155(3), putting the carrier on 60-day notice to cure.

Attorney Fee Shifting

Florida Statute § 627.428 allows insureds who prevail in court to recover reasonable attorney’s fees. Note that recent reforms in Senate Bill 2A (2022) eliminated one-way fee shifting for many policies issued after December 2022; consult counsel to confirm your policy’s effective date.

Local Resources & Next Steps

Broward County Building & Permitting

Before mold remediation, verify permit requirements with Broward County’s Environmental Engineering and Permitting Division. Unpermitted work may jeopardize claim reimbursement.

Flood Zone Maps and Moisture Prevention

Use FEMA’s Flood Map Service Center to see if your Hollywood property sits in Zone AE or VE. Homes in lower-lying east Hollywood near the Intracoastal Waterway face higher hydrostatic pressure, making slab leaks more likely.

Free State-Run Help Lines

• DFS Consumer Helpline: 1-877-693-5236

• Florida Bar Lawyer Referral Service: 1-800-342-8011

• Broward County Legal Aid: 954-765-8950

Checklist for Hollywood Homeowners

• Report mold claim to insurer in writing within 48 hours of discovery.

• Photograph damage, moisture meters, and source of water.

• Hire licensed mold assessor; obtain written protocol and cost estimate.

• Secure temporary dehumidifiers to halt spread.

• Request insurer decision within 30 days citing Fla. Stat. § 627.70131.

• If denied, file DFS complaint and request mediation.

• Consider NOI and consult a Florida-licensed property insurance attorney.

Authoritative References

Florida Statutes Chapter 627 (Insurance Rates and Contracts) DFS Property Insurance Complaint & Mediation Portal Florida Office of Insurance Regulation Consumer Resources Johnson v. Omega Ins. Co., 200 So.3d 1207 (Fla. 2016)

Legal Disclaimer

This guide provides general information for Hollywood, Florida homeowners. It is not legal advice. Laws change, and facts vary. You should consult a licensed Florida attorney about your specific situation.

If your property insurance claim was denied, call Louis Law Group at 833-657-4812 for a free case evaluation and policy review.