Court Revives $1.25M Bad Faith Claim Against Progressive Over Failed $15K Settlement

How the Settlement Fell Apart

In September 2016, Charbel Consul rear-ended a car driven by William Choisser, a physician and attorney, in Florida. Progressive found Consul fully at fault. His policy covered $10,000 per person for bodily injury and $10,000 for property damage.

Choisser's attorney offered to settle for $10,000 for the injuries and $5,000 for his 1991 Mercedes. In November 2016, Progressive sent checks for both amounts but asked for two things the offer hadn't included.

The first was a release from Choisser's wife giving up any loss of consortium claim, which a spouse can bring over how an injury affects the marriage. Choisser's attorney didn't represent her and wouldn't give her name. The adjuster found the name "Mary" through an online and database search and put it on the release. Mary was Choisser's ex-wife.

The second was the car's title. Progressive had declared the car a total loss, which Choisser disputed, and said Florida law required it to take the title.

Choisser's attorney rejected the deal in December 2016. Choisser sued, settled the car claim for $7,500, and took the injury claim to trial. The final judgment against Consul was $1,254,505, including $790,000 in damages and $388,505 in attorney's fees.

Why the Appeals Court Wants a Jury to Decide

Consul sued Progressive for bad faith in 2021, arguing the insurer failed to protect him from a judgment far above his coverage. A federal judge ruled for Progressive in 2023 without a trial. He found the insurer had paid the full demand and acted to protect Consul from a later claim by the wife.

Judge Nancy Abudu, joined by Judge Robin Rosenbaum, found three issues a jury should weigh. The adjuster never contacted the wife, which the court said went against her usual practice, and never asked Consul whether he would settle without the release. Consul testified he would have, and the wife testified she had no interest in suing.

On the title, Florida law lets an owner who keeps a totaled car send the title to the state himself, so the court said Progressive had no need to demand it. The court also found conflicting evidence over whether Progressive ever warned Consul that the claim could exceed his coverage.

Judge Gerald Tjoflat dissented. He noted that Consul can't pay the judgment and that any money he wins will go to Choisser. He also pointed to gamesmanship by Choisser's attorney, who withheld the wife's name and never flagged the wrong one.

The ruling doesn't find that Progressive acted in bad faith. It sends the case back to the trial court, where a jury may decide that question.

What It Means for People Hit by Underinsured Drivers

Florida requires drivers to carry only $10,000 in personal injury protection and $10,000 in property damage liability. Bodily injury liability, which pays for injuries a driver causes to others, isn't required for most drivers. The Insurance Research Council estimated that 20.6% of Florida drivers were uninsured in 2023, and nearly 4 in 10 were underinsured.

A judgment against a driver with little coverage and few assets can be hard to collect. When an insurer unreasonably fails to settle within the policy limits, Florida law can make it pay the part of the judgment above those limits. That is the money at stake in Consul's case.

The rules have tightened since he sued. Under Florida's revised statute, an insurer that offers the policy limits or the amount demanded within 90 days of receiving a claim backed by enough evidence is protected from bad faith suits filed after March 24, 2023. The same law cut the deadline for most injury lawsuits from four years to two.

If the driver who hit you carries minimal coverage, the independent attorneys we connect you with can help you understand every source of recovery.

For more articles like this, visit our News Page.