An appeals court ruling represents another setback to Florida insurers, attorneys say, just weeks after state legislators failed to pass bills to limit when a consumer can sign over control of insurance benefits to a contractor who, say, dries out water damage.

A May 20 ruling by the state’s Fourth District Court of Appeal in a case from Palm Beach County means deals assigning benefits to contractors “have been and continue to be valid under Florida law,” said Ely R. Levy, a Hollywood attorney. He represents a contractor, ASAP Restoration, that performs emergency dry-out services to homeowners, in a case against Tower Hill Signature Insurance Co.

The insurance company argued its customer agreement prevented signing over control of the benefits in this way. The appeals ruling overturns a lower-court ruling. A Tower Hill spokeswoman had no immediate comment.

During the legislative session, contractors argued barring such deals could leave homeowners battling the insurance company on their own, but insurers said all customers ultimately pay more if contractors inflate charges.

“The legislature’s failure to directly address the assignment of benefits crisis will allow runaway claims to spiral further out of control,” said William Stander, executive director of the Florida Property & Casualty Association, said in April. “Coupled with the approaching hurricane season, which brings its own uncertainties, the potential for higher rates is palpable.”

By Charles Elmore

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