Causation: People’s Trust Insurance Company v. Garcia

The Third District Court of Appeal of Florida recently issued an opinion in People’s Trust Insurance Company v. Garcia, holding that when causation is disputed, and a homeowner’s insurer admits coverage for a portion of a claim, the issue of causation is an amount-of-loss question subject to appraisal. It is well established under Florida case law that the issue of coverage is to be determined by the court, whereas, the issue of amount-of-loss is to be determined by an appraisal panel.

While the Florida Supreme Court previously held that causation is a coverage question for the court when coverage is wholly denied, the court’s consensus as to causation of damages remained somewhat unresolved. Through this decision, the Third District set forth important precedent to clarify that when the insurer has not wholly denied coverage, “causation is an amount-of-loss question for the appraisal panel, not a coverage question that can only be decided by a court.”