Florida Governor Signs AOB Bill
Florida Gov. Ron DeSantis (R) has signed legislation aimed at curbing a flood of assignment of benefits (AOB) lawsuits. Enactment of the legislation is seen as a major victory for insurers, who have argued that litigation and fraud involving the practice are driving up property insurance premiums.
The bill is expected to keep consumers in control of their insurance policies and, over time, reduce insurers’ costs for inflated claims and litigation that must be passed along to consumers. Changes to one-way attorney fees should eliminate incentives for filing costly lawsuits. Other provisions add protections for consumers, including allowing policyholders the right to rescind an AOB without penalties and requiring written estimates for work.
According to a report published by the Insurance Information Institute, the number of AOB-related lawsuits increased to 153,007 in 2018, up from 1,300 in 2000. ““It is a great day for Florida homeowners,” said Liz Reynolds, regional vice president of the Southeast for the National Association of Mutual Insurance Companies (NAMIC). “This legislation is an important step toward curbing the explosion of lawsuits stemming from unscrupulous contractors and attorneys preying on consumers that has driven up the cost of residential insurance for everyone.”