Security First Insurance Company's endorsement restricting the ability of policyholders to assign post-loss benefits was struck down by the Florida District Court of Appeal. Security First Ins. Co. v. Florida Office of Ins. Regulation, 2017 Fla. App. LEXIS 18083 (Fla. Ct. App. Dec. 1, 2017).
The Department of Insurance, Office of Insurance Regulation (OIR), disapproved Security First's request to amend its policy language to restrict the ability of policyholders to assign post-loss benefits. The endorsement restricted the assignment of post-loss benefits absent the consent of all insureds, all additional insureds, and all mortgagees named in their policies. OIR found that the forms violated Florida statutes because it included language restricting the assignment of post-loss claim benefits. Secruity First appealed the OIR ruling.
Security First concedes that Florida case law held that an endorsement requiring an insurer's consent for a post-loss assignment of benefits was not enforceable. But it argued that such case law only applied to provisions requiring the insurer's consent. The court disagreed. Prior decisions held that the right to recover under an insurance policy was freely assignable after loss. The OIR properly construed this case law. Therefore, the court affirmed the final administrative order.
