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Common Misconceptions about Assignment of Benefits

Common Misconceptions about Assignment of Benefits

  1. Assignments of property insurance benefits are a recent phenomenon.

    False: Assignments of post-loss benefit payments have been recognized by Florida law for over 100

  2. Assignment of Benefits give contractors special rights the policyholder would not have.

    False: Assignment of Benefits does not give contractor’s additional rights. Assignment of
    Benefits allows the assignee to stand in the shoes on the insured.

  3. Assignment of benefits allow contractors to inflate prices.

    False: This is a false sentiment propagated by insurance companies. Assignment of benefits have no
    impact on a contractors ability to inflate pricing.

  4. Assignment of Benefits allow contractors to file lawsuits within days of claim being filed.

    False: Assignment of Benefits does not override insurance policy provisions allowing certain time
    periods for coverage determinations.

  5. Assignment of Benefits are not fair because they violate “Non-Assignment” clauses in insurance contracts

    False: Assignment of Benefits only assign the right to receive payment for services performed, not
    the insurance policy itself

  6. Assignment of Benefits let contractors circumvent policy obligations

    False: Even with an assignment, all policy obligations remain with the homeowner and will be
    enforced by Florida courts

  7. Contractors who take Assignment of Benefits are claiming ownership of the entire claim, not just payment for services they performed!

    False: Assignment of Benefits only transfers the right to receive payment for contracted services,
    not an entire claim.

  8. Contractors who receive Assignment of Benefits violate Florida’s “Public Adjusting” Statue

    False: An Assignment of Benefits is legally distinct from Public Adjusting.

  9. An Assignment of Benefits violates Florida Statue 627.405 because contractors don’t have an “insurable interest” in the property

    False: Florida Statue 627.405 only requires that the policyholder have an insurable interest at
    the time of the loss

  10. Assignment of Benefits violates Florida’s “Lien Laws” pursuant to Florida Statue 713.32

    False: Florida Statue 713.32 only deals with applications to place a lien on the property; an
    Assignment of Benefits is not lien or an application for a lien.

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