Seeking the truth in assignment of benefits

TALLAHASSEE, Fla. (CAPITOL NEWS SERVICE) - A Florida Senate committee is expected to approve major changes to a state law allowing homeowners to sign over their rights to third-party contractors. The practice is being blamed for doubling the number of lawsuits against insurance companies, and people who remediate water damage are at the center of the dispute.

In response to the public records request, Citizens has declined to provide individual claims data, citing privacy concerns. It has yet to respond with a general picture of settlements before and after a lawsuit has been filed.

Dozens of small business owners who specialize in restoring water-damaged homes have been walking the Capitol with a proverbial target on their back.

Josh Reynolds, who owns WrightWay Emergency Services in Nokomis is the President of the Restoration Association of Florida. He says the target is on their backs for a reason.

“You know, we fight the insurance companies. We just don’t accept what they are willing to pay,” said Reynolds.

He and like companies are being blamed for driving up insurance costs. Citizens alone says lawsuits filed by third-party vendors are responsible for an average $244 rate hike coming this year.

“Some of them call it a scam,” says State Senator Doug Broxson. He says it’s only going to get worse.

“Are the people of Florida willing to pay, potentially, double their premium in ten years if you don’t fix this?” said Broxson.

Broxson’s bill would allow homeowners who sue to collect their attorney’s fees, but not third-party contractors.

But if your roof gets blown off, lawyers like Margaret Gardner say no one’s going to fix it if they aren’t guaranteed getting paid.

“If you can’t get your roof replaced, every time it rains, even with tarping, eventually you’re going to get more water intrusion,“ she said.

Fighting back, the contractors have asked for detailed information about more than a quarter million Citizens claims paid over the last five years. They think it will tell a story of Citizens being penny wise and pound foolish.

“And I think afterward you'll see that most contractors are able to recover between 70 and 100 percent of their bills after litigation,” said Reynolds.

The restoration specialists admit that they’ve got a few bad actors in their business, and their solution is to create a system of licensing, which they say will drive the bad guys out.

In response to the public records request, Citizens has declined to provide individual claims data, citing privacy concerns. It has yet to respond with a general picture of settlements before and after a lawsuit has been filed. And late Monday, the Florida Supreme Court agreed to hear an assignment of benefits case arising out of Port St. Joe.