Florida Statute Limits Right of Insured to Assign Benefits of Insurance
Post 4972
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Holding Insurance Companies Accountable, LLC ("HICA" ) challenged the entry of summary judgment for American Integrity Insurance Company of Florida ("American Integrity" ). HICA, as an assignee of post-loss insurance benefits, sued American Integrity for breach of contract. The trial court ruled that HICA lacked standing to sue because the assignment that it relied on did not follow the governing statute.
Holding Insurance Companies Accountable, LLC a/a/o Leonard Caruso v. American Integrity Insurance Company of Florida, No. 5D2023-2810, Florida Court of Appeals, Fifth District (January 3, 2025) resolved the dispute.
FACTS
Leonard Caruso owns a house in The Villages. In 2019, the house suffered roof damage. Caruso reported the loss to his insurer, American Integrity. He selected Noland's Roofing to repair the damage and signed a "Direction of Payment" instructing American Integrity to pay Noland's Roofing directly.
After receiving American Integrity's valuation of his claim, Caruso signed an "Assignment of Benefits Contract" with HICA in 2020.
HICA is a business that purports to help homeowners enforce their insurance rights. The document indicated that HICA would not provide "any services to protect, repair, restore, or replace [Caruso's] property or to mitigate against further damage to [Caruso's] property, as contemplated by" section 627.7152, Florida Statutes. However, it stated that "[a]ny payments shall be made in accordance with any Direction of Payment relative to" Caruso's claim.
Ultimately, HICA-as Caruso's assignee-sued American Integrity for breach of contract, alleging that American Integrity failed to pay the full value of Caruso's claim. HICA demanded "payment in accordance with the existing Direction of Payment." American Integrity raised lack of standing as an affirmative defense, maintaining that the assignment was "invalid and/or void" and the court granted American Integrity's motion.
The court's order included these findings:
1. “The parties agree that [HICA] did not comply with the provisions of Fl. Stat. Sec. 627.7152. The issue for the Court to determine is whether the "assignment of benefits" obtained by [HICA] from CARUSO is subject to Fl. Stat. Sec. 627.7152 ....
2. “The Court specifically finds that there is sufficient evidence in this case to show that any money recovered in this case would be used to make repairs to the roof by Noland Roofing and that payment would be made to Noland Roofing.
3. “The Court finds that Noland's Roofing sent the direction to pay to American Integrity ....
4. “The Court finds that the Assignment Agreement specifically says that HICA will make payments in accordance with the direction to pay ("Any payments shall be made in accordance with any Direction of Payment relative to the below referenced claim" ).
5. “The Court finds that [HICA], through [its] Verified Answers to [American Integrity's] Interrogatories, has indicated that proceeds from any recovery in this case would be used to pay Noland's Roofing (‘Noland's Roofing, Inc. is the chosen contractor upon which the insured has executed a direction in pay in favor of.’).”
Section 627.7152 was enacted by the Florida legislature in 2019 to regulate assignment agreements that seek to transfer insurance benefits from the policyholder to a third party. Under the statute, an "[a]ssignment agreement" is "any instrument by which post-loss benefits under a residential property insurance policy . . . are assigned or transferred or acquired in any manner . . . to or from a person providing services to protect, repair, restore, or replace property or to mitigate against further damage to the property." § 627.7152(1)(b), Fla. Stat. (2020).
Before assigning his benefits to HICA, Caruso signed a direction of payment in favor of Noland's Roofing, which instructed American Integrity to make Noland's Roofing a payee on any disbursement check. Here, the chosen vendor is Noland's Roofing. HICA's corporate representative also acknowledged that the goal of HICA's lawsuit was to recover the replacement cost of Caruso's roof, plus interest and related costs.
There was no genuine dispute that consistent with the assignment's terms, any funds recovered by HICA will go to Noland's Roofing. As the trial court found, this mandatory pass-through of benefits from HICA to Noland's Roofing places the assignment within the broad reach of section 627.7152. Even though HICA will not personally scale Caruso's house to repair his roof, it is seeking funds to facilitate those repairs.
The assignment HICA relies on is an "assignment agreement" under section 627.7152.
The legislature mandated that such assignments comply with all other provisions of that statute. Because the assignment here did not do so, it is "invalid and unenforceable." Without a valid assignment, HICA has no standing to sue American Integrity.
ZALMA OPINION
Because the state of Florida found that there was an abuse by roofers, contractors, and others by use of the assignment of benefits increasing unnecessary litigation impacting the availability of insurance for citizens of Florida, enacted a statute to limits the assignments. The statute was violated by Plaintiff HICA and its suit was found to be based upon an invalid and unenforceable assignment.
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Concealing a Weapon Used in a Murder is an Intentional & Criminal Act
Post 5002
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In Howard I. Rosenberg; Kimberly L. Rosenberg v. Chubb Indemnity Insurance Company Howard I. Rosenberg; Kimberly L. Rosenberg; Kimberly L. Rosenberg; Howard I. Rosenberg v. Hudson Insurance Company, No. 22-3275, United States Court of Appeals, Third Circuit (February 11, 2025) the Third Circuit resolved whether the insurers owed a defense for murder and acts performed to hide the fact of a murder and the murder weapon.
FACTUAL BACKGROUND
Adam Rosenberg and Christian Moore-Rouse befriended one another while they were students at the Community College of Allegheny County. On December 21, 2019, however, while at his parents’ house, Adam shot twenty-two-year-old Christian in the back of the head with a nine-millimeter Ruger SR9C handgun. Adam then dragged...
Renewal Notices Sent Electronically Are Legal, Approved by the State and Effective
Post 5000
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Washington state law allows insurers to deliver insurance notices and documents electronically if the party has affirmatively consented to that method of delivery and has not withdrawn the consent. The Plaintiffs argued that the terms and conditions statement was not “conspicuous” because it was hidden behind a hyperlink included in a single line of small text. The court found that the statement was sufficiently conspicuous as it was bolded and set off from the surrounding text in bright blue text.
In James Hughes et al. v. American Strategic Insurance Corp et al., No. 3:24-cv-05114-DGE, United States District Court (February 14, 2025) the USDC resolved the dispute.
The court’s reasoning focused on two main points:
1 whether the ...
Rescission in Michigan Requires Preprocurement Fraud
Post 4999
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Lie About Where Vehicle Was Garaged After Policy Inception Not Basis for Rescission
This appeal turns on whether fraud occurred in relation to an April 26, 2018 renewal contract for a policy of insurance under the no-fault act issued by plaintiff, Encompass Indemnity Company (“Encompass”).
In Samuel Tourkow, by David Tourkow v. Michael Thomas Fox, and Sweet Insurance Agency, formerly known as Verbiest Insurance Agency, Inc., Third-Party Defendant-Appellee. Encompass Indemnity Company, et al, Nos. 367494, 367512, Court of Appeals of Michigan (February 12, 2025) resolved the claims.
The plaintiff, Encompass Indemnity Company, issued a no-fault insurance policy to Jon and Joyce Fox, with Michael Fox added as an additional insured. The dispute centers on whether fraud occurred in...
Insurance Fraud Leads to Violent Crime
Post 4990
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CRIMINAL CONDUCT NEVER GETS BETTER
In The People v. Dennis Lee Givens, B330497, California Court of Appeals, Second District, Eighth Division (February 3, 2025) Givens appealed to reverse his conviction for human trafficking and sought an order for a new trial.
FACTS
In September 2020, Givens matched with J.C. on the dating app “Tagged.” J.C., who was 20 years old at the time, had known Givens since childhood because their mothers were best friends. After matching, J.C. and Givens saw each other daily, and J.C. began working as a prostitute under Givens’s direction.
Givens set quotas for J.C., took her earnings, and threatened her when she failed to meet his demands. In February 2022, J.C. confided in her mother who then contacted the Los Angeles Police Department. The police ...
Police Officer’s Involvement in Insurance Fraud Results in Jail
Post 4989
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Von Harris was convicted of bribery, forgery, and insurance fraud. He appealed his conviction and sentence. His appeal was denied, and the Court of Appeals upheld the conviction.
In State Of Ohio v. Von Harris, 2025-Ohio-279, No. 113618, Court of Appeals of Ohio, Eighth District (January 30, 2025) the Court of Appeals affirmed the conviction.
FACTUAL BACKGROUND
On January 23, 2024, the trial court sentenced Harris. The trial court sentenced Harris to six months in the county jail on Count 15; 12 months in prison on Counts 6, 8, 11, and 13; and 24 months in prison on Counts 5 and 10, with all counts running concurrent to one another for a total of 24 months in prison. The jury found Harris guilty based on his involvement in facilitating payments to an East Cleveland ...
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To Dispute an Arbitration Finding Party Must File Dispute Within 20 Days
Post 4988
EXCUSABLE NEGLECT SUFFICIENT TO DISPUTE ARBITRATION LATE
In Howard Roy Housen and Valerie Housen v. Universal Property & Casualty Insurance Company, No. 4D2023-2720, Florida Court of Appeals, Fourth District (January 22, 2025) the Housens appealed a final judgment in their breach of contract action.
FACTS
The Housens filed an insurance claim with Universal, which was denied, leading them to file a breach of contract action. The parties agreed to non-binding arbitration which resulted in an award not
favorable to the Housens. However, the Housens failed to file a notice of rejection of the arbitration decision within the required 20 days. Instead, they filed a motion for a new trial 29 days after the arbitrator’s decision, citing a clerical error for the delay.
The circuit court ...
