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In an effort to keep the Florida assignment of benefits (AOB) crisis from further worsening in the state, Florida’s insurance industry, regulators and consumer advocates are on high alert for AOB activity in the wake of Hurricane Michael and working to educate consumers on the pitfalls of signing over their policy rights.

“Consumers need all the information they can get to help navigate making repairs to their homes and vehicles, and we’re working hard to provide resources to help prevent Floridians from becoming victims of AOB scams,” said Mark Wilson, president and CEO of the Florida Chamber of Commerce, which spearheads the Consumer Protection Coalition, formed in 2017 to tackle the state’s AOB epidemic.

pressuring some to sign an assignment of benefits contract. Check with your insurance agent, insurance company, or call my office before you sign anything,” Florida CFO Jimmy Patronis warned in an Oct. 15 press release from the Department of Financial Services. “Storms bring out the best in people, but unfortunately, they bring out the worst in some. If it sounds too good to be true, it probably is.”

Florida’s AOB problem has stemmed from unlicensed water remediation and roofing contractors who have homeowners sign over their insurance policy rights in exchange for needed repairs to their homes, and then file inflated or fake claims with the insurer. When those claims are disputed or denied, these contractors file a lawsuit that insurers are often left footing the bill for.

Carriers across the state have seen an increase in litigation because of inflated claims, which is leading to increased costs for policyholders. According to the Florida Department of Financial Services, there were 405 AOB lawsuits across all 67 Florida counties in 2006, and by 2016 that number had risen to 28,200.

State officials have warned that the AOB issue could become even worse in the aftermath of a large-scale disaster, such as Hurricane Michael, due to a large number of claims triggering a contractor shortage, and people who are anxious to get repairs started on their homes assigning their insurance policy benefits to contractors.

Florida Insurance Commissioner David Altmaier said before Michael hit that scenario was one of his biggest concerns, and noted the quick handling of claims would help ensure people are not taken advantage of

Please enjoy the full article below;

https://www.insurancejournal.com/news/southeast/2018/10/18/504876.htm

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