Florida 5th DCA Decides Proof of Available Insurance in the Marketplace Is Not Required for All Claims Against an Agent or Broker

In its January 2, 2026, decision, the Fifth District Court of Appeal (DCA) remanded a case for a new trial on damages, where the jury’s damage award for breach of fiduciary duty and negligent misrepresentation was based on an insurance policy, which had been determined in a prior declaratory judgment litigation to not provide coverage.

The ruling, which has implications for insurance agents and brokers across the state, stems from losses suffered by two Ormond Beach restaurants during Hurricane Matthew in 2016, when sewage backed up into their properties. The insurer, Lloyd’s of London, denied coverage, and the court ultimately agreed the policy did not cover that type of damage. The restaurants then sued their broker, Brown & Brown of Florida, alleging negligent failure to procure insurance, breach of fiduciary duty, and negligent misrepresentation. While the jury rejected the procurement claim, it found the broker liable for breach of fiduciary duty and negligent misrepresentation, assigning the broker the majority of fault. On appeal, Brown & Brown did not contest liability under the breach of fiduciary duty or negligent misrepresentation claims.

The 5th DCA reasoned that the 1998 decision of Capell v. Gamble, which held that agents cannot be liable for failing to procure insurance that does not exist and requires plaintiffs to prove the requested coverage was available in the marketplace, is inapplicable when analyzing breach of fiduciary duty and negligent misrepresentation claims. 733 So. 2d 534 (Fla. 1st DCA 1998). The court emphasized the 2024 precedent in E&R Environmental Services, LLC v. Sihle Financial Services, Inc., which held that agents and brokers have an independent duty to inform clients when requested coverage cannot be obtained so clients can consider alternatives. 396 So. 3d 624, 628 (Fla. 5th DCA 2024).

Ultimately, the 5th DCA found that the jury’s damage award as to breach of fiduciary duty and negligent misrepresentation was in error, because the award was based on an insurance policy that did not provide coverage for the loss. Accordingly, the court ordered a new trial on damages and clarified that recoverable damages may include consequential or resulting collateral damage.

The ruling sends a strong message that Florida agents and brokers must clearly disclose and explain coverage gaps and unavailable insurance and document such practice in writing, in order to avoid unpredictable damages which, fall outside the scope of the purchased policy[ies].

_{Legal Update for Insurance Agents & Brokers- January 12, 2026, is prepared by Marshall Dennehey to provide information on recent legal developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. We would be pleased to provide such legal assistance as you require on these and other subjects when called upon. ATTORNEY ADVERTISING pursuant to New York RPC 7.1 Copyright © 2026 Marshall Dennehey, all rights reserved. No part of this publication may be reprinted without the express written permission of our firm. For reprints or inquiries, or if you wish to be removed from this mailing list, contact MEDeSatnick@mdwcg.com.}