A recent decision from Florida's Fifth District Court of Appeal delivers an important reminder for policyholders and businesses across the state: insurance agents and brokers owe real, enforceable legal duties to their clients—and they can be held accountable when those duties are breached.

In Brown & Brown of Florida, Inc. v. Houligan's Pub & Club, Inc., the court addressed the scope of liability facing insurance brokers when coverage fails to protect the business or homeowner after a major loss. While the case arose from damage caused by Hurricane Matthew nearly a decade ago, the court's ruling has very modern implications for Florida property owners and businesses relying on insurance professionals to guide them when procuring insurance.

What Happened

The dispute involved two Ormond Beach restaurants that relied on their insurance broker to procure appropriate commercial property coverage. After Hurricane Matthew struck in 2016, sewage backed up into the restaurants, causing extensive damage. The restaurants filed claims under their Lloyd's of London policies—only to learn years later that the policies did not cover the loss.

When coverage was denied, the restaurants sued their insurance broker for three separate claims:

1. Negligent failure to procure insurance;
2. Breach of fiduciary duty; and
3. Negligent misrepresentation.

At trial, the jury found in favor of the broker on the narrow claim for negligent procurement. However, it found the broker liable for breach of fiduciary duty and negligent misrepresentation, concluding that the broker had made representations to the restaurants about coverage that were not accurate and failed to properly advise its clients on coverage issues.

The Duties Owed and the Damages Available

The appellate court made clear that an insurance agent's responsibility does not end with simply placing some coverage. Agents and brokers also owe duties of honesty, disclosure, and reasonable care—especially when advising clients about what risks are and are not covered.

Although the case was sent back for a new trial on damages—because the previous determination was based on an invalid policy—the appellate court reaffirmed that damages for these types of claims may extend beyond policy limits and can include consequential damages, such as financial losses caused by reliance on an agent's misstatements.

What This Means for Florida Policyholders

This decision reinforces a critical principle: insurance agents and brokers are professionals with legal responsibilities, not just intermediaries filling out applications. When they make promises about coverage, fail to disclose limitations in coverage, or do not communicate important information, they can be held accountable under Florida law.

For business owners and property owners, this ruling underscores the importance of asking insurance brokers detailed questions, obtaining written confirmations—especially on coverage questions—and seeking legal advice when coverage disputes arise.

At Taylor, Warren, Weidner, Hancock & Barnes, we regularly help clients evaluate whether insurance professionals met their legal obligations—and whether a denial of coverage may point to a deeper failure behind the scenes.  If you have questions about an insurance loss or believe you were misled about coverage, understanding your rights is the first step toward protecting your future.  Contact one of our experienced insurance attorneys for a free no-cost, no-obligation consultation today.