Ron DeSantis OKs bill on assignment of benefits (AOB) abuse

Florida water damage AOB
“This legislation will protect Florida consumers from predatory insurance practices.”

Gov. Ron DeSantis has signed a bill that aims to curb abuse of what’s known in the insurance industry as assignment of benefits (AOB).

DeSantis approved the measure (HB 7065) on Thursday.

“I thank the Florida Legislature for passing meaningful AOB reform, which has become a racket in recent years,” DeSantis said in a statement. “This legislation will protect Florida consumers from predatory insurance practices.”

AOB agreements allow policyholders to give up their insurance contract rights to third-parties in exchange for quick repairs, and relief from the hassle of dealing with claims.

Critics claim contractors abuse these agreements to inflate repair bills and launch frivolous litigation. Attorneys and contractors blame foot-dragging insurers for forcing lawsuits.

“HB 7065 establishes important consumer protections for property insurance policies by setting forth requirements for the execution, validity and effect of such agreements, and creating a formula that will determine which party, if any, receives an award of attorney fees should litigation related to an assignment agreement result in a judgment,” the Governor’s Office said in a press release.

“This reform bill is expected to curtail the exponential growth in AOB abuse that has contributed to rising insurance costs for Floridians.”

Advocates of the bill lauded the Governor in statements released by his office.

— CFO Jimmy Patronis: “This year, we advocated for Florida homeowners and passed reforms to help stop rampant lawsuit abuse across the state. I am proud Governor DeSantis continues to fight for Floridians and with the signing of this bill, we are empowering families to take back control of their insurance benefits. Ultimately, Florida consumers are the biggest winners with these new and critical protections.”

— Insurance Commissioner David Altmaier: “We commend the Governor for his leadership in signing the recently passed AOB legislation and look forward to the relief it will bring to Florida’s insurance consumers.”

— Sen. Doug Broxson: “I would like to thank Governor DeSantis for recognizing the tremendous abuse that has occurred with assignment of benefits. I appreciate his leadership, along with Senate President Bill Galvano, in passing this much needed reform for our constituents.”

— Rep. Bob Rommel: “After years of abuse by a few bad actors, Florida has finally passed a comprehensive bipartisan AOB reform bill that will help protect Floridians from skyrocketing insurance rates.”

In other reaction:

Barry Gilway, President, CEO and Executive Director of Citizens Property Insurance Corp.: “I want to thank Gov. DeSantis for his quick action on this much-needed piece of legislation. This new law represents a major step forward in our efforts to stem rising premiums caused by unnecessary litigation and assignment of benefits abuse. It is going to make a difference.”

Michael Carlson, President of the Personal Insurance Federation of Florida (PIFF): “We are grateful that AOB reform is now officially here for homeowners, so fewer Floridians can be taken advantage of during their times of need.”

Logan McFaddin, Florida Regional Manager for the American Property Casualty Insurance Association: “Senator Doug Broxson, Representative Bob Rommel, Senate President Bill Galvano and House Speaker Jose Oliva recognized there was a problem with AOB and worked on a solution to protect Floridians. Thanks to their leadership and Governor Ron DeSantis’ support and him signing AOB reform into law today, bad actors will no longer be able to take advantage of homeowners. This law will protect Florida home and business owners alike from bad actors who are taking advantage of them and our legal system just to put more money in their own pockets.”

Jeff Grady, President and CEO of the Florida Association of Insurance Agents: “FAIA and our coalition partners have been advocating for AOB reform for nearly seven years, and today’s bill signing is a huge win for insurance consumers across our state. We thank Gov. DeSantis for recognizing the importance of AOB reform and signing HB 7065 into law.”

Liz Reynolds, Regional Vice President of the Southeast for the National Association of Mutual Insurance Companies (NAMIC): “It is a great day for Florida homeowners as Governor Ron DeSantis placed his signature on the assignment of benefits bill.  It was a long and storied fight to get this bill enacted, but finally Florida lawmakers put partisanship aside and came together for all Floridians. Gone are the days of unscrupulous contractors and attorneys preying on consumers and clogging the court system with outrageous lawsuits. Gone are the days when Florida homeowners are victimized again by some bad actors who view AOBs as their personal cash cow. NAMIC extends appreciation to the governor and legislators for supporting this very important piece of legislation.”

William Stander, executive director of the Florida Property & Casualty Association: “Finally, with the signing of HB 7065, homeowners will be armed with valuable tools to protect themselves against predatory vendors who pressure them to sign over their valuable insurance policy rights. This new law puts homeowners back in control.”

Staff Reports


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