Your freedom to contract is under attack! Your right to freely transfer your own insurance benefits has been a part of Florida law for over a century. This right is very important to consumers because it allows you to be made whole quickly, efficiently, and with quality workmanship, when you suffer a loss that is covered by an insurance policy.
Lately, this essential right has come under attack by special interest groups and lobbyists for the insurance industry, who hope to cut costs to the insurance companies’ bottom lines at the expense of consumers, like you, in Florida. These special interest groups and lobbyists for insurance companies are attempting to persuade lawmakers to make changes to this important right. These changes will have negative consequences for consumers. Here is what you need to know.
Transferring Insurance Benefits in Florida
In Florida, you have the right to transfer your insurance benefits to service providers. This right has been enjoyed by consumers throughout Florida for over a century. If a consumer suffers a loss that is covered under an insurance policy, they can transfer the payout of their insurance claim to the service provider who fixed the damage. This is an important right for you, as it allows you to have repairs done quickly and by the service provider of your choice. Additionally, it allows the service provider to deal directly with the insurance company regarding payment so that you do not have to. This is important because consumers don’t often have the experience needed to negotiate with insurance companies on fair prices. Finally, if your insurance company fails to properly pay your claim, you won’t need to hire a lawyer to fight your insurance company since you’ve assigned that claim to the service provider.
This is significant because, for the most part, the service provider is in a much better position than you to deal with the insurance company on these issues. Typically, a service provider deals with insurance companies on a daily basis. Service providers have the experience to immediately know if your insurance company is not providing proper payment. Also, the service provider will be better able to support any claim through the court system as they usually have prior experience and knowledge in this area as well. A service provider may be more willing to hold an insurance company accountable for any failure to abide by the insurance policy’s terms. This helps you receive better quality work and products.
Special Interest Groups are Trying to Take Away Your Right to Transfer Benefits
Recently, special interest groups and lobbyists for insurance companies have been trying to take away your right to transfer benefits under insurance policies. The insurance industry is lobbying the legislature to pass laws that will have a negative impact on consumers and limit your rights. These special interest groups are trying to convince lawmakers to pass laws that take away or severely limit your right to transfer benefits under an insurance policy.
In fact, insurance companies have already convinced lawmakers to change some laws regarding your right to transfer insurance benefits! There have been changes affecting the ability to assign benefits under a property insurance policy. Significantly, a homeowner no longer has a right to transfer their own rights to attorney’s fees to a service provider, such as roofers or other home repair specialists. This change hurts small businesses. The new law will ultimately have a negative impact on consumers in the State of Florida, as it will now be solely up to consumers, like you, to wrangle with their property insurance company to obtain proper payment for their loss.
The efforts of these special interest groups are not highly publicized, but should not go unnoticed by consumers, as those actions will significantly impact consumers.
How Changes Will Negatively Impact Consumers
The insurance industry’s proposed changes to assignments of benefits will have a significant and negative impact on consumers. Any changes will likely have an effect on anyone with insurance in the state of Florida. If you can no longer transfer your own insurance benefits to service providers, you’ll be forced to deal with the insurance company yourself if you are unhappy with the amount paid on your claim. Work will be delayed because you will need to first receive payment from your insurance company. Then you’ll be forced to find a service provider who is willing to work for the amount offered by the insurance company – an amount that is sometimes deeply discounted. If the insurance company failed to properly pay your claim, you’ll have to fight with them over the proper amount for payment. If a lawsuit needs to be filed, you’ll have to hire an attorney yourself, instead of having the freedom to pass the problem off to the service provider.
If service providers are no longer able to rely on transfers of insurance benefits, they would likely not be willing to perform work before receiving payment. This would inevitably lead to delays for you in replacing items or repairing any damage that you suffered as a result of the loss. If you are not willing to or are unable to endure such a delay, you’ll have to pay for the replacement or repair out of your own pocket with no guarantee that the insurance company will ever pay you for your out-of-pocket expenses.
Furthermore, this would incentivize insurance companies to pay a lower amount to resolve each claim. This, in turn, would limit your ability to obtain quality products or work from a service provider, and may end up forcing you to choose between paying a portion out of your own pocket or accepting lower quality products or workmanship.
Even more lengthy delays will result if a consumer is forced to obtain relief through the court system. In that scenario, a consumer would not be able to properly fix a loss until it received payment after the successful conclusion of a lawsuit. A court action could take months or even years to resolve. This would leave the consumer in the difficult position of having to choose to either pay out of their own pocket or wait until the legal process is concluded.
Also, a consumer could be forced to use a service provider that accepts the insurance company’s deeply discounted rates rather than pay any extra amounts out of their own pocket. This would limit the ability of consumers to choose what goods or services that they want to use to repair or replace their loss.
By way of example, if you go to the doctor, typically your doctor’s office will handle all billing and payment by the insurance company without much of a headache to you. Without the ability to transfer insurance benefits, you would likely be responsible for paying all the costs of the visit and treatment up front. You’ll then have to struggle with your insurance company to pay the covered amounts to you. If your insurance does not properly pay you, it will be up to you to wrangle with them over the payment. If you are unable to obtain proper payment, it will be up to you to hire an attorney and address it through the court system.
If your car is damaged and the damage is covered by your insurance, in most cases, the service provider can deal with your insurance so that they can be paid. If you are unable to assign your benefits under the insurance policy, you would need to either pay the costs to repair your vehicle out of your own pocket up front or wait until you received payment from your insurance company to make the repairs. If you choose to pay out of pocket up front, there would be no guarantee that you would be fully reimbursed by your insurance. If your insurance did not provide you with the proper payment, it would again be up to you to struggle with them over payment and file a lawsuit if you were unsuccessful in obtaining proper payment. Your choice of repair shops would likely be limited by the amount your insurance company paid you. You might be forced to accept lower quality work so that you do not have to pay out of pocket. Unfortunately, without the ability to transfer insurance benefits, handling all of this would be up to you.
All of these outcomes are bad news for consumers and hurt the small businesses that we rely on and know. Any changes to your freedom to assign your insurance benefits to service providers will certainly create negative consequences for anyone with an insurance policy in Florida.
What You Need to Do to Stop the Change
The loss of your freedom and rights to transfer your insurance benefits is not inevitable. You can have a say in what ultimately happens to assignments of benefits in the state of Florida. Please contact your local Florida state representative and state senator to let them know that you are AGAINST any changes that would take away your right and freedom to assign your own insurance benefits!
To find your local Florida state senator and contact information, please visit: https://www.flsenate.gov/senators/find
To find your local Florida state representative and contact information, please visit: https://www.myfloridahouse.gov/findyourrepresentative
We understand that navigating an insurance claim can be difficult and confusing. We are here to help. If you have any questions or need assistance with an insurance claim, please contact us at (813) 254-7119.
Authored by Property Damage Attorney, Thomas McFadyen
Posted on behalf of