by: Alex Ponce
Insurance companies, such as Allstate, AIG, and State Farm, have earned reputations as aggressive claims fighters and will always attempt to find ways to deny payment of claims. For example, Farmers Insurance, the nation’s third largest insurance group, had an incentive program called “Quest for Gold,” which offered incentives to adjusters who met low payment goals.
In order to level the playing field between big insurance companies and their insured, Florida enacted Fla. Stat. § 627.428, which automatically entitles the insured to a “reasonable sum” for his or her attorney’s fees when the insured prevails against their insurance company. However, the Southern District has previously held that while statutory fees may be awarded for litigating the issue of entitlement to attorney’s fees, attorney’s fees are not awarded for litigating the amount of fees to be paid by the losing party. Allowing attorneys for the insurance companies to argue the necessity of each itemized fee instead of looking at the reasonableness of the total sum of fees would disserve the purpose for the enactment of Fla. Stat. § 627.428.
Nonetheless, after Johnson v. Omega Insurance Company, Florida law is now settled that “the purpose of this statute is to provide an adequate means to afford a level process and make an already financially burdened insured whole again, and to also discourage insurance companies from withholding benefits on valid claims. This statutory provision is of significant importance to the citizens of Florida.” Stated differently, the purpose of Fla. Stat. § 627.428 is to level the scales of justice for policy holders by taking into consideration additional costs that policyholders must incur in order to compete with insurance carriers for the payment of incorrectly denied benefits.
Florida courts have looked to the purpose of the statute when determining issues of law. For example, the Second District Court of Appeals looked to the 2010 version of Fla. Stat. § 627.428 in order to determine that attorney’s fees could be awarded on direct appeal or even in certiorari proceedings. The court explicitly stated that “if the purpose of the statute is to be achieved, it is illogical to grant fees to a successful insured who files a direct appeal but to deny fees to a successful insured who files a certiorari petition” and allowed the insured to recover fees. In light of Johnson, which specifically made clear that there was a need for fee and cost reimbursement because “the Legislature recognized that an insured is not made whole when an insurer simply grants the previously denied benefits”, allowing an insurer to dissect each itemized fee in order to litigate its necessity would shift the burden to the policyholder to now be liable for additional costs that must be incurred in order for the policyholder to have their claim resolved.
Even though it is clearly settled law that “the purpose of section 627.428 is to penalize an insurance company for wrongfully causing its insured to resort to litigation in order to resolve a conflict,” the policyholder would have to foot the bill whenever his attorney is required to defend the reasonableness of the fees incurred in resolving the policyholder’s claim. Therefore, if attorneys were forced to defend the reasonableness of each itemized fee charged for their services, then the purpose of Fla. Stat. § 627.428 would be disserved, as it would not level the playing field between an insured and its insurer. Although Fla. Stat. § 627.428 clearly states that the standard is “a reasonable sum as fees or compensation for the insured’s or beneficiary’s attorney,” the Florida legislature should more clearly define that the standard is not one of reasonableness and necessity for each itemized fee. 
 Tricks of the Trade: How Insurance Companies Deny, Delay, Confuse and Refuse, American Association for Justice, https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved=0ahUKEwiGuI3b2t3RAhXEWCYKHYqKAswQFgg8MAA&url=https%3A%2F%2Fwww.justice.org%2Fsites%2Fdefault%2Ffiles%2Ffile-uploads%2FInsuranceTactics.pdf&usg=AFQjCNG6I6Ep7jWV9W7p9obz_0I25UXORg&sig2=–ID4xd0qSTLOIldf57_fw&bvm=bv.145063293,d.eWE at 4.
 See Fla. Stat. 627.428 (2016).
 See State Farm Fire & Casualty Co. v. Palma, 629 So. 2d 830, 830 (Fla. 1993).
 Johnson v. Omega Ins. Co., 200 So. 3d 1207, 1207 (Fla. 2016)(citing Ivey v. Allstate Ins. Co., 774 So. 2d 679, 684 (Fla. 2000).
 Allen v. State Farm Fla. Ins. Co., No. 2D15-3114, 2016 Fla. App. LEXIS 12381, at *2 (Fla. 2d DCA, Aug. 17, 2016).
 Id. at *5.
 See Johnson, 200 So.3d at 1215.
 See Bassette v. Standard Fire Ins. Co., 803 So. 2d 744, 746 (Fla. 2d DCA 2001).
 Fla. Stat. 627.428 (2016) (emphasis added).