Florida Senate Banking and Insurance Committee To Consider Assignment of Benefits Abuse Bill Today

 

With a packed agenda comprising mostly insurance-related bills, the Florida Senate Banking and Insurance Committee meets today, April 3, 2017 at 4 p.m. (ET).

Of substantial interest to the insurance industry is SB 1218 relating to Property Repair by Senator Gary Farmer.  The bill creates new requirements for assignment of post-loss benefits from personal residential and commercial residential property insurance policies.

Although it allows an insurer to prohibit the assignment of post-loss benefits, it provides that an insurer may not prohibit the post-loss assignment of benefits in a personal lines residential property insurance policy or a commercial residential property insurance policy.  This would allow insurers to offer policies that prohibit the assignment of post-loss benefits in some other lines of insurance.

For example, an auto insurer would be allowed–subject to approval by the Florida Office of Insurance Regulation–to include a policy provision prohibiting the assignment of post-loss benefits of auto glass claims.  It would allow a commercial lines insurer to include restrictions on assignment of post-loss benefits in its policies, subject to OIR approval.

The bill does not specify how this assignment provision would affect Personal Injury Protection insurance, inasmuch as Florida law contains specific provisions that appear to contemplate assignments of benefits, according to a legislative analysis.

SB 1218 provides that an agreement to assign post-loss benefits is not valid unless the agreement:

• Is in writing between the policyholder and assignee and is delivered to the insurer under specified time requirements;
• Is limited to claims for work performed by the assignee for damage to dwellings or structures covered under the policy;
• Allows the policyholder to unilaterally rescind the assignment of post-loss benefits to a vendor if work has not yet begun or if the assignee fails to meet the standards required for such work; and
• Contains an accurate and up-to-date statement of the scope of work to be performed.

It also provides that an assignee:

• Must provide the policyholder with accurate and up-to date revised statements of the scope of work to be performed as supplemental or additional repairs are required;
• Must guarantee to the policyholder that the work performed conforms to current and accepted industry standards;
• May not charge the policyholder more than the applicable deductible contained in the policy unless the policyholder opts for additional work at the policyholder’s own expense;
• May not charge the policyholder directly, except for additional work not covered under the policy; and
• May not pay referral fees totaling more than $750 in connection with the assignment.

In addition, for water damage claims, the assignee must be licensed or certified by the state or a private licensing entity to perform certain work.

• The bill creates a regulatory system for professional water damage restorers.  It requires the Florida Department of Business and Professional Regulation to license professional water damage restorers if they are of good moral character, has specified insurance, and satisfies the Institute of Inspection, Cleaning, and Restoration Certification S500 standards.

A trial lawyer, SB 1218 sponsor Gary Farmer has been at the forefront of high-profile consumer litigation in Florida and nationwide.  To read an interview with him about the bill in today’s FloridaPolitics.com, click here.

To access complete bill information on SB 1218, click here.

The following insurance-related bills are also on today’s agenda:

SB 580 by Garcia Insurance Administrators
CS/SB 680 by Judiciary/Baxley relating to Bail Bonds
SB 922 by Garcia relating to Insurance Adjusters
SB 1012 by Brandes relating to Investigative and Forensic Services
SB 1014 by Brandes relating to Public Records/Division of Investigative and Forensic Services of the Department of Financial Services
SB 1032 by Mayfield relating to Unfair Insurance Trade Practices
SB 1218 by Farmer relating to Property Repair
SB 1316 by Bracy relating to Preinsurance Inspection
SB 1582 by Bradley relating to Workers Compensation Insurance
SB 1684 by Farmer relating to Insurance Rates
SB 1766 by Lee relating to Motor Vehicle Insurance
SB 1768 by Lee relating to Public Records/Medical Payments Coverage and Liability Motor Vehicle Insurance Policies/Department of Highway Safety and Motor Vehicles
SB 7012 by Health Policy relating to Ratification of Department of Health Rules

To watch a live Webcast of today’s meeting, go to www.TheFloridaChannel.org (and click on “live streams”), or click here.

 

 

Should you have any questions or comments, please contact Colodny Fass.

 

 

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