Insurers can't dodge attorney's fees by choosing to repair a home instead of paying the claim, a Florida appeals court ruled. 

On August 12, 2026, Florida's Fourth District Court of Appeal reversed a trial court and held that two condominium owners can recover attorney's fees from the Florida Insurance Guaranty Association (FIGA), the fund that takes over claims when an insurer becomes insolvent. 

In 2015, a water supply line broke and flooded the owners' condo, damaging the flooring. Their insurer, Avatar Property and Casualty Insurance Company, used its policy option to repair the home rather than pay out. Under Florida law, that choice creates a separate agreement - a Drew repair contract - that binds the insurer to restore the property to its pre-loss condition. 

Avatar's contractor did the work, but the owners called it deficient. Avatar offered to correct only a portion, then said it would not address the deficient work. The owners sued. After a first trial and appeal, Avatar was declared insolvent in March 2022, and FIGA stepped in as the defendant. 

The owners' contractor estimated repairs at $49,674.94. In August 2022, FIGA paid only $19,000, cutting items it tied to "Ordinance and Law" coverage - the part of a policy that pays "the cost of bringing any structure . . . into compliance with applicable ordinances or laws," including electrical upgrades and architectural and drafting fees. FIGA's corporate representative later testified that the $19,000 payment was a mistake because the entire claim was not a covered claim. 

The parties settled the payment side with a consent judgment ordering FIGA to pay the $58,000 policy limits, less the $19,000 already paid. The fight over attorney's fees continued. 

Two now-repealed statutes decided it. Section 627.428, a one-way law that let insureds - not insurers - recover fees, still applied. The court held it reaches disputes over a Drew repair contract, because that contract "arises under" the policy. 

Section 631.70 normally shields FIGA from those fees unless it "denies by affirmative action, other than delay" a covered claim. The court found FIGA had done exactly that - underpaying before it answered, denying coverage in its defenses, and repeatedly arguing the claim was not covered. 

For carriers and claims teams, the takeaway is direct: electing to repair does not remove fee exposure, and cutting an estimate line by line can read as a coverage denial. 

The ruling is not final until the time for rehearing passes.