TALLAHASSEE, Fla. (The News Service of Florida) - Lawmakers in Florida are again looking at overhauling the controversial insurance practice known as "assignment of benefits."
That involves insurance customers signing over claims to contractors, who do work and ultimately pursue payment from insurers.
The issue has become controversial in recent years amid allegations by insurers that the system has become rife with fraud and litigation which drives up consumers' insurance premiums.
Much of the focus has been on water-damage claims in South Florida but now is spilling into the recovery in the Panhandle from Hurricane Michael.
"Florida law requires that I approve a rate that is not inadequate. So, to the extent that these continue to rise, so to will consumer rates. So, this really is an issue where we are fighting for lower insurance rates for consumers," said Florida Insurance Commissioner David Altmaier.
The Citizens Property Insurance Board recently approved a plan that would raise residential insurance rates by an average of 8.2 percent starting in September.
That's for customers of the state-backed insurer of last resort which writes policies for homes in high-risk areas that are unable to find property insurance elsewhere.
"This is an issue, from our perspective, that is completely out of control. It is driving up rates, not just for Citizens, but for the entire marketplace. Without question, it is the number one consumer issue that we are facing," said Barry Gilway, President with Citizens Property Insurance.
The insurance industry and its supporters are focused on trying to limit attorney fees in AOB disputes.
But opponents of attorney-fee changes say assignment of benefits and the possibility of litigation help make sure insurers properly take care of claims.
They feel the real issue is that some insurance companies are low balling loss estimates on claims.
