Assignment Of Benefit Contracts Blamed For Upending Insurance Market In Florida

Within hours of a fire at Kelly Laub’s four-bedroom house in New Smyrna Beach, Fla., in June, four contracting companies showed up to offer rebuilding services. Each vendor wanted Ms. Laub to sign a document giving the contractor the rights to her homeowners insurance benefits, she said. In exchange, they offered to repair her home and negotiate with her insurance company on her behalf. These assignment of benefit, or AOB, contracts are upending the insurance market in one of the largest U.S. states. Insurers and regulators said the pacts are responsible for driving up insurance rates for some Florida homeowners and spurring a boom in contractor lawsuits against insurers.