Recently, Gov. Ron DeSantis signed the bill (CS/CS/HB 7065) that establishes important reforms to the Assignment of Benefits (AOB) process. Special thanks to Florida Realtors® and all our members who helped fight for this new law!
Insurance Information Institute there were roughly 1,300 AOB lawsuits statewide in 2000. That number climbed to more than 79,000 in 2013 and nearly 135,000 through Nov. 9, 2018, a 70% increase in just five years. With the rise in AOB abuse comes higher premiums, as insurers seek to recoup their losses.
“Realtors have been advocating for AOB reform because we are on the front lines of the home-buying process," Sain said. "Seeing people work hard for their home and then having higher insurance premiums due to this abuse is disheartening. These reforms will go a long way to fixing this problem and helping homeowners throughout Florida.”
HB 7065 reforms one-way attorney fees, which is a primary incentive behind AOB abuse. Under the new law, attorney fees are governed by a formula that looks at the difference between a pre-trial settlement offer and final judgement. Depending on the difference between these two figures, the insurer, the assignee or neither could be entitled to recover attorney fees.
All bill provisions become effective on July 1, 2019, except for provisions relating to attorney fees, which became effective when the bill was signed into law.