Insurance
— Assignment of post-loss rights — An insured has the right to assign
post-loss rights without the insurer’s consent

SECURITY FIRST INSURANCE COMPANY, Appellant, v. STATE OF FLORIDA, OFFICE
OF INSURANCE REGULATION, Appellee. 1st District. Case No. 1D14-1864. Opinion
filed October 26, 2015. An appeal from the Florida Office of Insurance
Regulation. Kevin M. McCarty, Commissioner. Counsel: Maria Elena Abate, and Amy
L. Koltnow of Colodny, Fass, Talenfeld, Karlinsky, Abate & Webb, P.A., Fort
Lauderdale, for Appellant. Belinda Miller, General Counsel, Bruce Culpepper and
Patrick Flemming, Assistant General Counsels, Florida Office of Insurance
Regulation, Tallahassee, for Appellee.

ON MOTIONS FOR
REHEARING AND CERTIFICATION

[Original Opinion at 40 Fla. L. Weekly D1449a]

(MAKAR, J.) Security First Insurance Company asks that we rehear this
matter and certify conflict with decisions of the Fourth District1 on the issue of whether an insured may assign
post-loss rights under a policy without the insurer’s consent. Finding no basis
for rehearing and no inconsistency, let alone conflict, with the Fourth District’s
cases, we deny both motions. See, e.g., One Call Prop. Servs. Inc. v.
Sec. First Ins. Co., 165 So. 3d 749, 753 (Fla. 4th DCA 2015) (“Even when an
insurance policy contains a provision barring assignment of the policy, an
insured may assign a post-loss claim.”).

Security First also asks that we certify as a question of great public
importance, whether an insurance policy’s prohibition of an insured’s
assignment of “any benefit or post-loss right” without the insurer’s
consent is “void as contrary to the Florida Statutes or to this state’s ‘public
policy’ ”? As recounted in our merits opinion, a century of precedents from
Florida’s courts — including, most recently, the Fourth District in One
Call — has said that an insured may assign post-loss rights without the
insurer’s consent. See, e.g., W. Fla. Grocery Co. v. Teutonia Fire
Ins. Co., 74 Fla. 220, 77 So. 209, 210-11 (Fla. 1917). The original basis
for this principle is a bit murky, the supreme court in Teutonia Fire
simply saying it was a “well-settled rule” without much discussion. Id.
at 210. But its vitality has persevered since that time. We recognize that “the
failure to certify a question eliminates this potential basis for the Supreme
Court of Florida’s jurisdiction,” Harry Lee Anstead et. al., The Operation
and Jurisdiction of the Supreme Court of Florida, 29 Nova L. Rev. 431, 527
(2005), but we see little indication that supreme court review is warranted
given the overall consistency in the precedents.

That said, we note one exception from this well-settled legal principle:
health care insurance policies that prohibit insureds from using and assigning
post-loss rights or benefits to health care providers outside an insurer’s
established network. As the Fourth District noted in upholding an anti-assignment
provision in a health insurance policy: “[i]f a patient could obtain care from
a non-participating [provider] and assign it the patient’s right to be
reimbursed under a group policy, in the teeth of an anti-assignment clause,
this direct payment inducement to become a participating [provider] would be
weakened or eliminated.” Kohl, 955 So. 2d at 1145 (citation omitted).
The court deemed it permissible because the anti-assignment clause had
beneficial and important economic ramifications on the provision of health care
services through lower-cost provider networks; it was good public policy as
reflected in “Florida statutes [that] authorize prohibitions on assignment of
both health insurance benefits and health insurance contracts.” 955 So. 2d at
1143 (citing § 627.638(2), Fla. Stat. (2005)). The Fourth District recognized
that “[p]ublic policy may limit the parties’ freedom to incorporate an
anti-assignment clause into a contract” but concluded that “public policy
favors the type of anti-assignment clause at issue in this case.” Id. at
1144. Security First, like the insurer in Kohl, says that public policy
favors the type of limitation it wants to impose on its insureds because the
legal principle at issue has had negative consequences for the insurance
industry and its insureds in recent years, mostly as to water remediation
companies. Nevertheless, it cannot point to a statute, such as the health care
ones cited in Kohl, that directly supports such a policy. We again
conclude, therefore, that it is for the legislative branch to consider this
public policy problem, not the courts, at this juncture. Legislative review
provides a more detailed inquiry into the current situation in the industry and
greater flexibility in achieving meaningful reforms, if deemed necessary. On
the other hand, courts are ill-equipped to pass judgment on the merits of the
policy debate at hand, and less likely to be able to formulate a remedy that is
mutually beneficial to insureds and insurers. Security First’s motions are
thereby denied. (RAY and BILBREY, JJ., CONCUR.)

__________________

1One Call Prop. Servs., Inc. v. Sec. First
Ins. Co., 165 So. 3d 749 (Fla. 4th DCA 2015); Kohl v. Blue Cross & Blue
Shield of Fla., Inc., 988 So. 2d 654 (Fla. 4th DCA 2008); Kohl v. Blue
Cross & Blue Shield of Fla., Inc., 955 So. 2d 1140 (Fla. 4th DCA 2007);
and Classic Concepts, Inc. v. Poland, 570 So. 2d 311 (Fla. 4th DCA
1990).

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