How to Fight Fraud as a Florida Homeowner

Insurance fraud is a crime we all pay for, costing consumers more than $308.6 billion each year.” Coalition Against Insurance Fraud

What Is Fraud?

Simply put, fraud is intentional deception for the purpose of getting someone to give up their property, money, or some lawful right. Penalties for committing fraud in Florida include jail, fines, and/or restitution.


There are a great many types of fraud prevalent in the world today. Many of these are carried out using modern communication methods, such as phone calls, texts, emails, and social media. Most people are familiar with identity theft, when someone uses your personal/banking information to steal your money or commit other crimes. One-third of all Americans have experienced this type of fraud at some point in their lives. 


Florida homeowners are particularly susceptible to becoming the victim of several different types of fraud – and many don’t realize it until the damage is done. This includes contractor fraud, home repair scams, and foreclosure schemes. There is also fraud perpetrated by homeowners, such as when false or exaggerated claims are submitted to their insurers. Homeowners might also fake a burglary, report old damage as new, or submit inflated repair invoices. All are fraud.


Warning Signs of Insurance Fraud

Contractor fraud and home repair scams typically involve a knock on the door by someone you don’t know and didn’t contact, offering to repair damage to your home after a disaster. Often, these so-called contractors are unlicensed, and may perform shoddy or incomplete work, for which a homeowner may have no recourse. In some cases, they will require a deposit from you – and then disappear without performing any work at all.


Here are some of the warning signs of fraud:


  • Being contacted by a builder/contractor you didn’t reach out to first
  • Solicitors who show up at your door unannounced and in unmarked vehicles
  • They request payment in cash only
  • “Free” home repairs in exchange for signing over your insurance benefits
  • No street address for their business
  • Requests payment in full up front or before the work is completed
  • Any offer sounding too good to be true


AOB Fraud: A Thing of the Past?

Assignment of benefits (AOB) used to be a fairly regular practice, where homeowners would sign over their insurance benefits on a covered loss to a third-party, such as the builder or contractor performing repairs on their home. This allowed the builder or contractor to receive money directly from the insurance company.


However, AOB agreements were a huge driver of insurance fraud. It led to significantly inflated claims and substantial litigation filed by attorneys on behalf of  contractors. Insurers were also often stuck with huge legal bills fending off these lawsuits. For example, although homeowner claims in Florida accounted for less than 10% of all such claims made nationwide, litigation related to those claims was enormous. Nearly 80% of all homeowners insurance-related litigation in the U.S. was occurring in Florida, according to the Insurance Information Institute’s analysis of data from the Florida Office of Insurance Regulation and the National Association of Insurance Commissioners. Of course, all these increasing costs contributed to a rise in policyholder premium costs.


But, no more! In December 2022, new laws were enacted in Florida to stabilize the insurance market and protect homeowners and insurers from rampant AOB fraud. The new laws put an end to AOB agreements and one-way attorney’s fees. Homeowners’ insurance policies written after January 1, 2023, no longer allow for assignment of benefits.


Consequences of Insurance Fraud

Because insurers are often forced to pay high settlements or to bear the cost of litigating claims, these expenses are then passed along to all homeowners in the state, who must pay ever-larger insurance rates. The high cost of insurance fraud can also lead to an increase in mortgage payments.


What Florida Homeowners Can Do

Contractors working in the state must be licensed by the Florida Department of Business and Professional Regulation (DBPR). If they’re working here without a license, it’s a serious crime carrying misdemeanor or felony penalties.


Here are some tips to help avoid potential insurance fraud when choosing a contractor for repair work on your home:


  • Hire local, reputable contractors.
  • Verify a contractor’s license by calling (850) 487-1395 or online at
  • Get three written and itemized estimates before deciding on a contractor.
  • Never agree to a cash-only arrangement. You may have difficulty proving you already paid, or have any available recourse if you’re not satisfied with the results, if the job was left undone.
  • Get a copy of the signed contract.
  • Make sure your insurance company will cover the costs and agree to repairs before work begins. The insurance adjuster should be able to provide you with an estimate of both the damage and repair costs.
  • Report suspected instances of fraud.


Report Fraud

If you suspect insurance fraud, report it to Fraud-Free Florida, the state’s anti-fraud initiative. You may even be eligible for a $25,000 reward. You can submit your report via the Fraud Free Florida website or by calling the insurance fraud hotline at (800) 378-0445.


At Florida Peninsula Insurance Company, we also have a dedicated Special Investigations Unit (SIU) to help tackle the issue. You can report suspected insurance fraud by calling the SIU at (866) 923-2920 or emailing


Florida Homeowners: Protect Yourself Against Fraud

If you’re a Florida homeowner, it’s especially important to remain alert for the warning signs of insurance fraud. And if you see something, say something.


At Florida Peninsula Insurance Company, it is our goal to keep you, your family, and your home safe and protected from potential perils – including insurance fraud. To discuss your coverage needs, call your Florida Peninsula agent now. If you’re not currently insured by us and would like to find out more, you can start by getting an online quote

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