Mounting insurance costs for Florida homeowners and steadily increasing rates of insurance dispute litigation have prompted the need for reform for the state’s assignment of benefits (AOB) laws. Signed by Gov. Ron DeSantis with an effective date of July 1, 2019, House Bill 7065 provides for substantial changes in the way in which insurance benefits may be assigned to third parties. The law is consumer-friendly in nature and aims to bring relief to Florida policyholders by providing them with additional protections against predatory insurance practices, AOB abuse, and fraud by contractors and vendors. If your property sustains damage, contact the Orlando attorneys with the Law Offices Of Michael B. Brehne, P.A. We will work diligently to help ensure the protection of your rights and your property.  

Provisions Of House Bill 7065

House Bill 7065 includes multiple provisions. 

  • Service providers are required to provide both insurers and consumers with prior written notice of at least 10 business days before filing suit on a claim
  • Revisions to Florida’s one-way attorney fee statute to incorporate a fee structure by attorneys in determining the fee amount awarded in lawsuits by an assignee against the insurer
  • Provisions which allow an insurer to enact a policy prohibiting assignment of benefits, either completely or partially, under certain conditions
  • Requirements for each insurer to report specific data on claims paid in the prior year by January 30, 2022, and each year thereafter
  • Prohibition of certain fees and alterations of policy provisions related to managed repairs in an assignment agreement
  • A definition of “assignment agreement” with established requirements for the execution, effect, and validity of agreements. 

Contact an Orlando insurance claim lawyer with our firm for more information or to discuss your homeowners insurance claims case.

What Is An Assignment Of Benefits (AOB)?

An assignment of benefits (AOB) transfers the rights or benefits of an insurance claim to a third party. An AOB provides the third party with the authority to file a claim to the insurance company, make decisions regarding property repair, and collect insurance payments all without the involvement or knowledge of the homeowner. These agreements have been commonly used in homeowners insurance claims by both restoration companies and contractors or vendors. When misused, a signed AOB can lead to harmful consequences for the homeowner.

The misuse of these agreements has resulted in a surge in cost for homeowners insurance throughout the State of Florida due to unnecessary litigation associated with AOB claims. Approximately 90 AOB insurance lawsuits were filed in 2008 — by 2018, the number of lawsuits increased by 19,000 percent. Provisions of House Bill 7065 serve to help remediate the misuse of AOBs by contractors and vendors for the benefit of Florida homeowners.

How Do I Know If I Am Signing An AOB?

Following an event in which a property sustains damage, homeowners may contact a roofer, contractor, plumber, water removal company, or another third-party vendor to perform emergency repairs and remediate the effects of storm damage, hurricane damage, water damage, or fire damage. Once the third party has assessed the damage, it may present the homeowner with a document to sign prior to performing repairs. The document may include language that contractually binds the homeowner to transfer their insurance benefits to the third party with an AOB. Prior to the passage of House Bill 2065, AOBs prevented homeowners from speaking directly with the insurance company about their claim, and instead, provided the third party with the ability to negotiate and endorse claim payments on behalf of the homeowner and, thereafter, file a lawsuit against the insurance company, with or without the homeowner’s knowledge. Homeowners are not required to sign an AOB — the most effective way to ensure the proper management of homeowners insurance claims is with the assistance of an experienced property damage lawyer. Contact the Law Offices of Michael B. Brehne, P.A.

What To Do If Your Property Becomes Damaged

If your property sustains damage due to a hurricane, tropical storm, a fire, or another cause, it’s important to know what to do in order to avoid issues such as abuses by contractors and vendors. Consider the following tips to ensure your interests and your property are protected prior to filing property damage claims.

  • Ensure the safety of yourself and your loved ones
  • Thoroughly document and photograph the damaged portion of property
  • Note the time requirements for filing a claim with the insurance company
  • Protect damaged property to remediate any additional damage
  • Read thoroughly your insurance policy and know your responsibilities following a loss
  • Contact insurance litigation attorneys as soon as possible to discuss your claim
  • Contact the insurance company and your attorney prior to signing any documents or contracts provided by contractors and third-party vendors
  • Beware of language in documents provided by third-parties that allow all proceeds of the claim to be made to anyone other that yourself