HERNANDEZ v. STATE FARM FIRE AND CASUALTY COMPANY (2000)

Appellant, Roberto Hernandez, seeks a reversal of a summary judgment entered in his class action suit against State Farm Fire and Casualty Co. His suit was based on section 627.7282(1), Florida Statutes (1997), which requires that the insured be sent a three-option letter whenever “a policyholder has been charged a premium that is incorrect for the coverage set forth in the insurance application.”   Because Hernandez was neither charged an incorrect premium nor was he quoted a premium pursuant to an insurance application, we affirm.

State Farm routinely sends out semi-annual notices to its policyholders concerning its premium renewal rates.   Additionally, State Farm offers its policyholders the option of making monthly payments, in which case the company sends them monthly payment coupons.   In September 1997, State Farm applied to the Florida Department of Insurance for rate changes, which were approved in October 1997, to be effective on January 1, 1998.   The rate changes were applied to existing policies as they came up for renewal in 1998.

Hernandez had been a policyholder with State Farm for four years.   In January 1998, State Farm advised him of the rate changes.   State Farm's semi-annual premium notice correctly stated that his six-month premium had been increased.   Hernandez, however, used a monthly payment coupon that had been generated in 1997 to make his first payment in January 1998.   This coupon did not reflect the rate increase.   Subsequently, Hernandez was sent a Notice of Payment Due for February 1998, containing an adjustment of $3.93 for the prior month's shortage.   Hernandez paid his regular monthly payment, including the new monthly charge under the new rate structure, as well as the $3.93 owed for January.

The trial court found that section 627.7282(1), Florida Statutes (1997), does not apply to renewal policies.   However, we do not need to reach this issue because Hernandez was never charged an incorrect premium.   At most, he was sent an incorrect monthly payment coupon.   Furthermore, the statute does not apply to a monthly statement.   The relevant premium notice under the statute in this case was the semi-annual notice concerning Hernandez's premium renewal rates.   This semi-annual notice correctly reflected the new increased premiums.   Thus, the learned trial judge was correct in granting summary judgment for State Farm.

Affirmed.

RAMIREZ, J.