Jimmy Buffett’s “land sharks” in the song “Fins” weren’t the plaintiff’s bar, but Florida carriers often feel, as the song goes, like “the only bait in town.” While Florida is well known for many things, like Jimmy Buffet, beautiful beaches and warm sunny weather, it historically has been a challenging insurance marketplace for liability carriers who frequently find themselves having to quickly respond to unreasonable timed policy-limit demands. These timed demands, often colloquially referred to as “bad faith setups,” typically have three things in common, each of which creates risk for the carrier: (1) they were made very soon after an underlying claim took place; (2) they were typically made before the carrier was able to adequately investigate the facts and circumstances of the claim; and (3) and they provide a very short deadline for acceptance—in some cases a mere handful of days—combined with threats of insurer bad faith and extracontractual exposure should the carrier not immediately tender its limits within the arbitrary deadline.

In 2023, however, Florida enacted significant tort reform legislation, some of which was directly intended to mitigate the ongoing problem of unreasonable timed policy-limit demands and the bad faith risks they entail. Among the 2023 reforms is Section 624.155(4)(a), Florida Statutes (the “Safe Harbor Statute”), which now provides carriers with a 90-day “safe harbor” protection from bad faith, regardless of whatever self-imposed settlement deadline may be issued by the claimant. The statute notes: 

(4)(a) An action for bad faith involving a liability insurance claim, including any such action brought under the common law, shall not lie if the insurer tenders the lesser of the policy limits or the amount demanded by the claimant within 90 days after receiving actual notice of a claim that is accompanied by sufficient evidence to support the amount of the claim.

(b) If an insurer does not tender the lesser of the policy limits or the amount demanded by the claimant within the 90-day period provided in paragraph (a), neither the existence of the 90-day period nor the fact that no bad faith action could lie had the insurer tendered that amount is admissible in any action seeking to establish bad faith on the part of the insurer.

(c) If the insurer fails to tender pursuant to paragraph (a) within the 90-day period, any applicable statute of limitations is extended for an additional 90 days.

Fla. Stat. § 624.155(4)(a) (2026) (emphasis added). 

The 11th Circuit Court of Appeals Decision in Chambers v. Progressive
While there has been relatively little litigation involving Florida’s Safe Harbor Statute, the importance of this statutory protection for carriers writing business in Florida cannot be overstated. This was recently highlighted in a new unpublished opinion from the United States Court of Appeals for the Eleventh Circuit in Chambers v. Progressive, Case No. 25-12392 (Oct. 5, 2026).

In Chambers, by operation of Florida’s new Safe Harbor Statute, Progressive defeated what would have been an almost $8 million excess judgment/bad faith claim. Specifically, the Eleventh Circuit affirmed judgment on the pleadings in favor of an auto liability carrier, Progressive, in a third-party bad faith action arising from “failure to settle” allegations and a resulting $7.4 million judgment against the insured arising from an underlying motorcycle accident. Following the underlying excess judgment, the insured's bankruptcy trustee pursued a bad faith action against Progressive, alleging that it engaged in bad faith by failing to settle the accident claim appropriately, leading to the excess judgment.

Although the bad faith/failure to settle conduct alleged against Progressive took place in 2018, well before the enactment of the Safe Harbor Statute, the Eleventh Circuit found that the Safe Harbor Statute still barred the subsequent bad faith claim now being made against Progressive. Therefore, the court rejected the plaintiff’s argument that applying the Safe Harbor Statute to the facts of the underlying claim impermissibly impaired preexisting contractual rights, an argument against retroactively applying the Statute. 

The Eleventh Circuit concluded that a third-party bad faith cause of action is distinct from the insurer's contractual duty of good faith—and therefore, a bad faith cause of action does not accrue until an excess judgment is actually entered. Consequently, there was no prohibition against retroactively applying the Statue. Further, because the excess judgment was entered in April 2023, after the statutory amendment creating the Safe Harbor Statute took effect, applying the Safe Harbor did not impermissibly affect an accrued cause of action for bad faith or impair existing contractual rights. Accordingly, the Eleventh Circuit affirmed the District Court’s dismissal of the bad faith action pursuant to Fla. Stat. § 624.155(4)(a):

The safe harbor rule applied to Chambers’ bad faith claim because it was effective when the claim accrued in April 2023. Under the rule, Progressive could not be liable if it tendered either the policy limit or the amount a claimant demanded within 90 days of the demand. The pleadings establish that, within 90 days of Spalding’s documented property damage demand, Progressive tendered the bodily injury policy limit and the amount Spalding demanded for the property damage claim. The district court, therefore, did not err by granting judgment on the pleadings for Progressive.

D.E. 45-1, p. 15. 

While the “land sharks” may still be circling and attempted “bad faith setups” won’t be going away any time soon, carriers in Florida now have a powerful defensive tool in their arsenal. It affords them a more reasonable and sensible period of time in which to investigate the merits of a potentially significant claim and determine how best to respond.