Three little words in a settlement - "inclusive of attorneys' fees" - didn't put Florida's guaranty fund on the hook, an appeals court ruled.
On August 12, 2026, Florida's Fourth District Court of Appeal narrowed what the Florida Insurance Guaranty Association (FIGA) has to pay. FIGA is the fund that steps in to cover claims when an insurer can no longer pay them.
The case grew out of a settlement between FIGA and a pair of policyholders, whom the court calls "the Insureds." Their complaint had sought attorneys' fees. When the two sides settled, the settlement agreement and release said the payment was "inclusive of attorneys' fees." The money was then divided into two portions: one going to the policyholders, the other to their counsel.
The sides soon disagreed about what that arrangement required. Both filed motions to enforce the settlement. FIGA argued that attorneys' fees are not part of the "covered claims" it is obligated to pay. The policyholders read the deal the other way, saying FIGA owed the full amount, fees included.
The trial court in Broward County sided with the policyholders. It denied FIGA's motion, granted the Insureds' motion, and ordered FIGA to pay the entire settlement, including the attorneys' fees portion. FIGA appealed, and the Fourth DCA reversed.
The court said the result was controlled by two of its own recent rulings from June and July 2026, and it pointed to a broader line of guaranty-association decisions reaching the same conclusion. "As with our previous decisions, we agree the trial court erred," it wrote. It sent the case back with instructions to vacate the order forcing FIGA to pay the whole amount and to grant FIGA's motion to enforce the settlement instead.
For claims teams, the lesson is about drafting. Labeling a payment "inclusive of attorneys' fees" does not, on its own, move those fees onto FIGA's obligation. The court treated the fees as separate from the covered claim, regardless of how the single payment was split between the policyholders and their lawyers.
The policyholders did not appear in the appeal. The decision is not final until the court rules on any timely motion for rehearing.
