Senate Bill 596
about sB 596
If you use an Assignment of Benefits contract in residential property losses and are a contractor in the state of Florida, this blog is a great informational resource for you! Currently, there are two industry related bills that are being considered by the Senate to pass right now, both of which could restrict the use of the Assignment of Benefits and could devastate small business owners.
In a nutshell, the Assignment of Benefits serves as the same document doctors’ offices use to in order to communicate and invoice your insurance carrier directly. It is also the same document you sign when replacing your windshield. In Florida, it is usually no cost to the policyholder to replace the windshield. They invoice your carrier directly and get paid by the carrier directly. Banning or restricting the use of the Assignment of Benefits contract will have lasting negative effects for the homeowner when faced with an emergency. Right now, the assignment allows a contractor to begin work immediately in order to stop future damages and preserve their property without the headache of paying out of pocket for the whole loss.
There will be a vote on the Hukill bill, regarding 2 things:
1: The Senator Hukill’s Bill
2: Senator Simmons Amendment
Senator Simmons Amendment serves the following 3 main components:
1. Essentially limits the use of AOB to only “emergency circumstances”.
2. Prohibits directly or indirectly receiving compensation (referral fees).
3. Allows property insurers to change their policies to limit post loss assignability.
consequences of the bill
Some would argue that Senate Bill 596 is going to limit homeowners’ rights and put insurance companies in complete control over who repairs damages in their home, and how much is spent doing so. Yes, every industry needs some sort of regulation to make sure businesses are being held to high standards in work, honesty, and quality. This can sometimes be a touchy subject because no matter where you go, people are subject to getting approached by dishonest sales people, contractors, and companies. Limiting small businesses by giving larger companies control over who their clients use as a service provider is never the right thing to do and will not solve the issue at hand.
Creating a balanced playing field for the larger companies, insurance providers, and small business owners is the fair thing to do. Putting restrictions on the documents small business owners use to relieve the pressure on homeowners can be seen by the public as partial. As a company in the service industry, we want to make sure everyone is able to receive the highest quality of service they desire from whomever they choose. There are no flaws in giving people the choice to do what they feel most comfortable with.
how are homeowners affected
Finding companies who tend to tell homeowners “white lies” to get them to pay for unnecessary services would be the PROPER way to regulate an industry. Sometimes people tend to group a whole service trade by those who do wrong by the freedoms given. Committing fraud to receive a payment is wrong and those are the people who should be penalized, not those who genuinely have the client’s best interest in mind. When we are called on to do a job, we believe taking care of the homeowner’s concerns no matter how big the job may be, and that is the right thing to do.
There have also been claims made in saying that homeowners are being negatively affected by contractors using Assignment of Benefits. It has been proven that there is no evidence of this. The Office of Insurance Regulation’s own data has shown only 3 complaints from homeowners over the past three years regarding to the Assignment of Benefits. That is only a tiny fraction of the jobs that actually have existed.
resources for you
We like to take all sides into consideration when informing the public of what is happening in our industry regarding regulations and new laws. We also want to make sure that every business in our industry is completely taken care of and treated fairly across the board.
Information regarding next week’s events in Tallahassee:
Banking & Insurance Committee: SB 1248 by Diaz de la Portilla (DLP) is on the agenda to be heard Feb 16th from 1:30 p.m. to 3:30 p.m.
Judiciary Committee: SB 596 by Senator Hukill is on the agenda to be heard on Feb 16th from 4:00 p.m. to 6:00 p.m.
We will be hosting a committee meeting at 12:00 p.m. on Tuesday February 16 near the capital building. Please feel free to join us. We look forward to informing all of our readers on any and all updates we receive on Senate Bill 596.