On Wednesday, May 21, 2015, the 4th District Court of Appeals in Palm Beach County ruled in favor of contractors in a long standing battle with home insurance companies regarding the assignment of benefits for emergency repair work on residential properties.
Assignment of benefits gives Florida contractors the right to deal directly with insurance companies for reimbursement after completing emergency repairs. When necessary, this also gives contractors the right to bring a lawsuit against the insurance company if payments for work completed are not dispersed. Insurance companies have been fighting the legal tool for years because it allows contractors to perform work before a claims adjuster reviews damages or approves the repairs, and in their arguments, opens the door to fraudulent insurance claims. Contractor attorneys, however, have been arguing that it is, instead, unethical insurance companies who only disagree with the tool because it requires them to pay out on damages that they may otherwise deny.
The judges overseeing the case acknowledged the opportunity for inflated repair charges and fraudulent work, but their final decision was in line with representing attorneys. They concluded that in an emergency situation, homeowners have the right to hire a professional to repair damages, especially in cases where they may not have money to pay for work upfront.
In April of 2015, Florida Lawmakers attempted to pass bills HB 669 and SB 1064 that would have limited the assignment of benefits without insurer’s consent. This bill did not pass, however, which makes the recent judgement in Palm Beach County a big win for our contractors lawyers in Jacksonville and throughout the State of Florida.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.