How Assignments of Benefits Are Impacting HowFirst-Party Assignments of Benefits Are Claims Impacting Property Insurance First-Party Property Insurance Claims William R. Lewis, Esq.1 & Timothy R. Engelbrecht, Esq.2 Butler Weihmuller Katz Craig, LLP3 Executive Summary Many insurers around the country have been actively monitoring the growth and development of assignment of benefit (“AOB”) litigation in first-party property damage claims in Florida over the past few years. These AOB claims and lawsuits present unique challenges to insurers both as claims and when they evolve into lawsuits. This article will (1) explain how the growth in AOB claims occurred in Florida; (2) describe the particular challenges insurers face in addressing AOB claims and lawsuits; (3) and discuss whether other states can expect to see a rise in AOB claims and lawsuits. I.
From hurricanes to sinkholes to AOBs.
Most people probably remember when Florida was devastated by a number of hurricanes in 2004 and 2005. Hurricane Charley made landfall in Florida in mid August of 2004 as a Category 4 hurricane. The storm killed 17 people in Florida4 and caused $13 billion in damage in Florida alone.5 Only a few weeks later, in early September,
1
Bill Lewis is a partner at Butler Weihmuller Katz Craig LLP. Since joining the firm in 1993, Bill has built a dynamic practice that focuses on the defense of first-party property insurance coverage and extracontractual matters. Bill’s experience includes handling matters involving Chinese drywall, oil spills, hurricanes, collapses, floods, sinkholes, fires, and earth movement. Bill can be reached at wlewis@butler.legal. 2
Timothy Engelbrecht is a partner at Butler Weihmuller Katz Craig LLP. Like Bill, Timothy’s practice focuses on assisting insurers in first-party property insurance coverage and extra-contractual matters. Timothy can be reached at tengelbrecht@butler.legal. 3
Butler Weihmuller Katz Craig, LLP is a civil litigation firm devoted entirely to defense and insurance litigation. The firm has been serving corporations, insurance companies, and insured individuals across the United States, Canada, Mexico, Europe and the Caribbean for more than 35 years. Please visit the firm’s website at http://www.butler.legal/. 4
http://www.sptimes.com/2004/08/16/Weather/Deaths_from_Hurricane.shtml.
5
https://en.wikipedia.org/wiki/Hurricane_Charley.