First DCA Holds Insurers Cannot Restrict Assignment of Benefits
In Security First Insurance Company v. OIR, Case No. 1D14-1864 (Fla. 1st DCA 2015), the 1st DCA denied Security First the right to amend its homeowner’s policy forms to restrict a policyholder’s ability to assign post-loss rights with the company’s consent. The company’s proposed language was: “Assignment of this policy or any benefit or post-loss right will not be valid unless we give our written consent.” The OIR had disapproved the proposed form change and the Company appealed the final order. In its decision, the Court noted that there is “an unbroken string of Florida cases over the past century holding that policyholders have the right to assign such claims without insurer consent.” The Court acknowledged the Company’s concerns which supported the form change, such as inflated or fraudulent post-loss claims filed by remediation companies, homeowners not understanding their rights when signing AOB’s, and a “cottage industry” of “vendors, contractors, and attorneys” that use AOB’s to force insurance companies to pay more money in claims. However, the Court ultimately held that those concerns would be better addressed by the Legislature.