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Florida Gov. DeSantis signs assignment of benefits reform into law


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Florida Gov. DeSantis signs assignment of benefits reform into law

Florida Gov. Ron DeSantis has signed into law legislation reforming the state's assignment of benefits system.

The law, which will take effect July 1, will restrict attorney fees in litigation and will allow AOB-exempt policies from insurers, The Insurance Insider noted. It will also restrict the rights of service providers to receive policyholders' claims payments and to recoup attorney fees, according to the report.

The reform bill will require a written agreement to allocate claims payments in an urgent situation and will also require service providers to give insurers and consumer 10 days' notice before they file a claim.

Justin O'Keefe, chief underwriting officer of property at RenaissanceRe Holdings Ltd. told the Insider that when AOB or litigation is involved, the average loss is 3x higher and the loss adjustment expense 4x higher. RenRe President and CEO Kevin O'Donnell said earlier in May that fraud has become a cost of doing business in Florida and that he did not have particularly high hopes that the AOB reform package would eliminate that risk.

"Governor DeSantis continues to demonstrate his strong commitment to Florida consumers and we commend him for his leadership," Florida Insurance Commissioner David Altmaier said in a statement. "By signing [the bill], we will better protect consumers from those who would take advantage of them by abusing the [AOB] process."