Insurance Reform and Competition

Insurance Litigation, Assignment of Benefits Reform a Key Focus of Florida Chamber of Commerce’s Insurance Summit Oct. 26-28


Florida insurance officials and industry leaders will meet to discuss the state’s top insurance issues for the upcoming year

TALLAHASSEE (October 21, 2015) – State law that was intended to ensure a level playing field between consumers and their insurance companies in the handling of claims has instead evolved into a windfall for some trial lawyers, contractors and other vendors, according to a new report by the Florida Justice Reform Institute.

The report, Restoring Balance in Insurance Litigation, calls on state lawmakers to amend Florida law to curb abuse of one-way attorney fees and Assignment of Benefits, or AOBs. The one-way attorney fee statute allows trial lawyers to collect legal fees from insurance companies if they prevail in a claims dispute, but prevents insurers from recouping their legal costs if the court instead rules in their favor. Emboldened by the statute, plaintiffs gain negotiating power to inflate bills and gain attorney fees that are potentially unwarranted or disproportionate to any amount recovered.

Over time, the one-way attorney fee statute has become an incentive for trial lawyers, contractors and other vendors – often water damage remediation firms, roofers, or auto glass shops with aggressive marketing schemes – to file meritless lawsuits using Assignment of Benefits. AOBs are intended to allow contractors to work directly with insurers in getting paid for work performed, without having the policyholder put up repair money. However, some third parties are soliciting AOBs as a means of taking control of the policyholder’s benefits and then using that authority to inflate claims and file lawsuits, sometimes without the knowledge or consent of the policyholder.

The Institute’s report, authored by Mark Delegal of Holland & Knight and Ashley Kalifeh of Capital City Consulting – two Tallahassee-based attorneys with extensive insurance experience – will be presented during the Florida Chamber of Commerce’s annual Insurance Summit Oct. 26-28 at the Grand Floridian Resort in Orlando. The event attracts Florida’s elected officials, insurance regulators and private industry leaders to discuss the major trends and issues impacting Florida insurance consumers.


“Maintaining a healthy and competitive private insurance market is essential to ensuring Florida is an attractive destination for new businesses, capital investment and job growth, while also benefiting consumers with more choices in the marketplace,” said Mark Wilson, President and CEO of the Florida Chamber of Commerce. “Already, Florida’s lawsuit abuse climate is known as one of the worst in the country. Unfortunately, rampant Assignment of Benefits abuse is threatening to worsen our state’s legal climate and cost families more.”


The conference will include speaker presentations and panelist discussions on various insurance issues, including the property and casualty market, pricing and cost drivers, regulations, cyber security, medical malpractice and workers’ compensation. A key focus will be one-way attorney fees and AOB, as outlined in the Florida Justice Reform Institute report.

“This report is the first, hard look at how the growing use of AOBs is increasing costs and litigation,” said William Large, president of the Florida Justice Reform Institute. “Policyholders just want to be made whole for their losses, but with an AOB, vendors and their lawyers are incentivized to increase the claim’s scope of work and maximize profit and litigation fees.”

Assignment of Benefits abuse has become widespread in South Florida and is quickly spreading throughout Florida. State-run Citizens Property Insurance Corp. says lawsuits over water damage claims are the main reason why it is raising 2016 premiums in the tri-county region of Broward, Miami-Dade and Palm Beach counties. Without AOB abuse, the rates for Citizens policyholders would have gone down. In addition, data mined from the Florida Department of Financial Services’ Service of Process Unit shows that AOB lawsuits have grown by 16,000 percent since 2000, and currently represent about one-third of all insurance litigation.


“As these water damage claims are absorbed by the insurance companies, it’s going to result in an increase in everyone’s homeowner premiums,” said Bob Rollins, an independent insurance agent for the Beacon Group in Boca Raton. “The best answer is a legislative approach. We need a law that has some teeth in it.”


Bills to address AOB abuse were introduced during the last three legislative sessions but failed amid intense lobbying pressure from trial attorneys, contractors and vendors who use this scheme. Similar legislation is expected to be filed for the 2016 session.


“The one-way attorney’s fee was meant to benefit the insured. It was not meant to benefit third party corporate vendors,” Large said. “Until legislators clarify this principle, the problem will only get worse.”


During the conference, Chamber organizers plan to unveil an educational video about the risks of blindly assigning insurance benefits to a contractor or other third party. John Rollins, Citizens’ chief risk officer, and Angel Conlin, general counsel for the American Strategic Insurance Co., will also discuss AOB abuse and its impact on insurers and homeowners.

NOTE: Media are encouraged to attend. RSVP to Edie Ousley at


The Florida Chamber of Commerce is the voice of business and the state’s largest federation of employers, chambers of commerce and associations, aggressively representing small and large businesses from every industry and every region. The Florida Chamber works within all branches of government to affect those changes set forth in the annual Florida Business Agenda, and which are seen as critical to secure Florida’s future. The Florida Chamber works closely with its Political Operations and the Florida Chamber Foundation. Visit for more information.

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