When an insurer goes insolvent and the Florida Insurance Guaranty Association steps into its shoes, FIGA is not on the hook for the part of a settlement that was really attorney’s fees. The Second District Court of Appeal reversed a judgment forcing FIGA to pay $20,000 that a now-insolvent insurer had agreed to send directly to opposing counsel.
Synergy Contracting, as assignee of a homeowner, sued United Property & Casualty for breach of a policy and settled for $90,000 — $83,887 to Synergy and $20,000 payable directly to Synergy’s law firm. Before the deal was performed, United became insolvent and FIGA was substituted in.
The panel held the $20,000 was for attorney’s fees “not within the coverage of the insurance policy,” and FIGA’s statutory obligation doesn’t extend to that, citing *Petty v. Florida Insurance Guaranty Association*, 80 So. 3d 313 (Fla. 2012). Synergy’s late argument that the full $90,000 was really damages couldn’t save the judgment, because it wasn’t raised below or supported by the settlement’s language.
**Why it matters:** claimants structuring settlements with an insurer should not assume FIGA will honor fee components if the carrier later fails. What FIGA covers is defined by the policy’s coverage, not by how the parties labeled the settlement.
*Florida Insurance Guaranty Ass’n v. Synergy Contracting Group, Inc., No. 2D2025-0999 (Fla. 2d DCA Sept. 2, 2026).*