Joshua Butts Quoted in ABC Action News Story on Citizens Insurance Rate Increases
Editor’s note: Originally published May 2016. The assignment-of-benefits abuse described here was a major driver of Florida’s insurance crisis; AOB was eliminated for property policies issued on or after January 1, 2023 under SB 2A, and Citizens has since reduced its policy count through depopulation. See our 2026 Florida Homeowners Insurance Guide for the current market.
Tampa’s ABC Action News recently did a story on the upcoming Citizens Insurance rate increases about to go into effect. Citizens Insurance, Florida’s state-run nonprofit home insurance company, announced to their customers some rate increases and rule changes brought on by “abuse” of company rules. Learn more about Florida homeowners insurance options.
The abuse, which amounts to legal fraud according to some insurance experts, is costing Citizens Insurance millions of dollars through a scheme that’s been happening all over the state, including in the Tampa Bay area, but is especially prevalent in South Florida.
“People are giving the full rights of their policy to a third party, in this case it’s a remediation company or a plumbing company or a company that can claim to take care of everything for them if they just sign here,” explains independent licensed insurance agent Joshua Butts of Cornerstone Insurance. “Not all of them have been honest with the people and it’s turning into a runaway freight train at this point,” Butts said.
What the 2016 story captured
The scheme in the story was assignment of benefits, or AOB. A homeowner with a water leak or roof problem would sign a form handing the full rights of their insurance claim to a contractor or remediation company. From that point the contractor billed the carrier directly, and when the carrier pushed back on the price, the dispute went to court in the homeowner’s name. Signed away in a stressful moment, one form could turn a routine repair into a lawsuit the homeowner never chose to file.
Multiply that across thousands of claims and the costs landed on every policyholder in the state. Rate filings at Citizens and the private carriers alike cited AOB losses year after year — the “runaway freight train” from the interview kept rolling for six more years.
What changed after the 2022 reforms
The Legislature’s December 2022 special session passed SB 2A, which repealed the one-way attorney fee statute that made mass claim litigation profitable, and ended assignment of benefits for property policies issued on or after January 1, 2023. Those were two of the fixes Joshua had publicly argued for — his case for them is preserved in End Florida’s Insurance Nightmare, written days before the session convened.
Where Citizens stands today
The rate pressure on Citizens hasn’t disappeared, but the story around it has changed: today the bigger question for most Citizens policyholders is depopulation — private carriers making takeout offers to move policies back into the private market. If that’s you, start with our guide to Citizens takeout offers, and see why Citizens cancels or non-renews policies for the current rules. Wherever your policy sits, an independent agency can put your home in front of the private market so a Citizens rate change is a data point, not a crisis.
Read the original story on the Wayback Machine archive (ABC Action News, May 2016).
