Defined term
Assignment of benefits (AOB)
An assignment of benefits transfers an insured's right to receive insurance proceeds to a third party — typically a contractor — who then deals with the carrier directly.
AOBs are most common in residential property work: a homeowner signs over insurance rights to a roofer or restoration contractor, who then submits the claim, performs the work, and collects directly from the carrier. Florida saw an AOB-driven litigation explosion in the 2010s.
Florida's SB 2A (effective December 2022) tightened AOB rules significantly — specific notice requirements, attorney's-fee restrictions, and detailed contract requirements now apply. Many AOBs that were valid before SB 2A are now defective. Alabama is more permissive on AOBs but has not seen Florida's volume of disputes. Anyone signing an AOB should have it reviewed; anyone receiving an AOB from a Florida homeowner needs to verify SB 2A compliance.
Statutes
- Fla. Stat. § 627.7152