A Florida Senate bill that aims to revise the state’s laws related to assignments of benefits (AOBs) passed the Rules Committee with a vote of 11--6 and moved to the full Senate for review April 19.
While both the bill, SB 122, and its companion House bill, HB 7065, originally focused on auto glass shops, neither bill addresses auto glass shops now. According to the Florida Senate, the bills are now identical in text.
An April 18 analysis of SB 122 provided on the Senate website explains that the bill “eliminates the ‘one way’ attorney fee for assignees.”
“The bill requires the assignee to give the insurer notice prior to the filing of a lawsuit and make a pre-suit demand,” reads the analysis. “The insurer must respond with a pre-suit settlement offer. To award fees, the court must compare the difference between the demand and the offer with the judgment obtained and award fees based on a formula. The bill allows insurers to make available a property insurance policy that prohibits or restricts the assignment of benefits. If an insurer offers a policy that prohibits or restricts assignments, it must offer a policy with benefits that are assignable.”
Further, “The bill requires assignees to comply with some of the policyholder’s duties under the insurance policy. Insurance policies generally require insureds to cooperate with the claims investigation, sit for examinations under oath by the insurance company, and participate in appraisal. This bill applies those duties to the assignees as well,” according to the analysis.
The analysis goes on to discuss the origins of the bill. “In recent years, insurers have complained of abuse of the assignment of benefits process,” reads the analysis.
It references a court filing by an insurance company that describes the issue, as follows:
“The typical scenario surrounding the use of an ‘assignment of benefits’ involved vendors and contractors, mostly water remediation companies, who were called by an insured immediately after a loss to perform emergency remediation services, such as water extraction.