SSN on Facebook SSN on Twitter SSN on YouTube RSS Feed


Finally, AOB Reform Bill Heads to an Eager DeSantis

April 24, 2019 - 5:45pm
Bob Rommel
Bob Rommel

After a fierce lobbying battle that included arguments about insurance rates and “bad actors,” the Florida Senate on Wednesday approved an overhaul of the insurance practice known as assignment of benefits.

The 25-14 vote sends the measure (HB 7065) to Gov. Ron DeSantis, who quickly issued a statement saying he will sign it. Passage of the bill was a major victory for insurers and business groups, which have argued that “AOB” abuses and excessive litigation have driven up homeowners’ insurance premiums.

“The exponential growth in AOB abuse has contributed to mounting insurance costs for Floridians for far too long,” DeSantis said in a prepared statement. “In recent years, there have been calls for reform and today, the Legislature took action. I thank them for their efforts in getting this done and I look forward to signing this meaningful legislation into law.”

Assignment of benefits is a decades-old practice that has become controversial in recent years, at least in part because of an increase in residential water-damage claims. In assignment of benefits, property owners in need of repairs sign over benefits to contractors, who ultimately pursue payments from insurance companies.

While insurers contend the practice has become riddled with fraud and litigation, plaintiffs’ attorneys and other groups say AOB helps make sure claims are properly paid. They accuse insurers of often trying lowball amounts paid for work.

The House passed the bill April 11, and the Senate ultimately went along with the House’s plan. As an example of one of the changes, the bill would let insurers offer policies that do not allow or restrict assignment of benefits. The concept is that such policies could be offered at lower prices to homeowners.

Another key part of the bill would effectively limit attorney fees in AOB lawsuits filed by contractors against insurers. The fee changes, which involve a formula, would not apply to lawsuits filed by policyholders.

Opponents of the bill argued, in part, that it should guarantee rate reductions for homeowners. The Senate on Tuesday rejected a proposed amendment aimed at requiring reductions.

Sen. Gary Farmer, a Fort Lauderdale Democrat who has been an outspoken critic of the bill, questioned the insurance industry’s contentions about a “crisis.”

“This bill is designed to cure a crisis that has not been actuarially shown,” Farmer said.

But supporters of the bill focused on alleged AOB abuses, with House sponsor Bob Rommel, R-Naples, frequently saying the issue is about addressing “bad actors.” The state-backed Citizens Property Insurance Corp. said the bill will help policyholders.

“Today’s vote is a critical step in our efforts to bring relief to our policyholders, who have had to pay the bill for runaway litigation and AOB abuse,” Barry Gilway, president and CEO of Citizens, said in a prepared statement.

During a floor debate Wednesday, Sen. Keith Perry, R-Gainesville, said abuses of the AOB process have led to a relative few attorneys making money, while “working people” pay higher insurance premiums.

“This is a predatory practice,” Perry said.


Insurance industry will now low ball all claims for less than required repairs and the homeowner will be on the hook after partial repairs... AOB abuse is one thing and what they should have went after. This bill just protects the insurers, not the homeowner.

Finally an attempt to rein in this abusive practice championed by 'bad actors'. After the thermogram scams, proliferation of PIP suits, chipped tile claims, cracked windshields and now AOB abuse have been put to rest, the Plaintiff's bar will find a new Achilles Heel to exploit against insurers in short order..

Bad for consumers $3000 cap is ridiculous

When it comes to money be assured most Floridians have been shut out. Think, Florida is the place where older Americans come to enjoy them golden years, and them profiteers have their hands out, you have to pay if you want to go to heaven,

Comments are now closed.



Live streaming of WBOB Talk Radio, a Sunshine State News Radio Partner.