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Senate committee passes assignment-of-benefits reform in water damage insurance claims

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A Senate committee passed a bill seeking to reform assignment-of-benefits for water damage claims on property insurance rates across the state.

LobbyTools reports that SB 1248, from Miami Republican Sen. Miguel Diaz de la Portilla, takes several steps to reduce abuse of AOB agreements, which allow third parties to claim the insurance benefits resulting from loss, rather than receiving an upfront payment from homeowners.

In part, the bill offers stronger prohibitions against water remediators, contractors or subcontractors who act as insurance adjustors. It bans them from either offering or receiving referral fees more than $25.

Also, the measure provides new consumer protections, such as requiring contractors and remediators to adhere to a printed scope of work and materials.

According to LobbyTools, De la Portilla offered an amendment specifically protecting homeowner’s properties from liens placed on them by contractors with an AOB agreement.

“If a contractor takes an assignment of benefit, the contractor’s only recourse is against an insurance company,” De la Portilla told the committee.

Among other changes include allowing contractors to offer revisions to the original scope of work, as well as clarifying that the regulations apply only to homeowner policies.

Port Orange Republican Sen. Dorothy Hukill, the sponsor of a failed bill reforming AOB agreements, voted for the bill despite her belief that it only “nibbled at the edges” of the problem.

AOB fraud is “spreading across the state,” Hukill told the committee, “and we need to make sure it doesn’t become an absolute crisis.”

Phil Ammann is a St. Petersburg-based journalist and blogger. With more than three decades of writing, editing and management experience, Phil produced material for both print and online, in addition to founding His broad range includes covering news, local government and culture reviews for, technical articles and profiles for BetterRVing Magazine and advice columns for a metaphysical website, among others. Phil has served as a contributor and production manager for SaintPetersBlog since 2013. He lives in St. Pete with his wife, visual artist Margaret Juul and can be reached at and on Twitter @PhilAmmann.

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