Oklahoma Lawmakers Pass Bill to Limit Assignment of Insurance Benefits
Oklahoma lawmakers have passed a bill limiting the post-loss assignment of benefits for property damage under auto, residential, or commercial property insurance policies. House Bill 1084 prohibits the solicitation or acceptance of an assignment of any post-loss insurance benefit related to property damage under these policies. The assignment of benefits is an agreement that transfers the insurance claims rights or benefits of an insurance policy to a third party, such as a roofer or plumber.
Rep. Mark Tedford, the author of the bill, stated that such agreements in a post-loss format can lead to inflated costs or legal disputes without the policyholder’s full awareness. “Limiting these types of agreements helps reduce fraud and unnecessary legal conflict, which ultimately helps lower insurance costs for everyone,” Tedford explained. “When third parties take control of a claim, it can result in inflated repair costs, excessive litigation, and confusion for the policyholder. House Bill 1084 helps restore accountability and ensures Oklahomans remain in control of their own claims.”
The law does not apply to liability coverage under auto, residential, or commercial property insurance policies. Violations of the bill are considered unfair or deceptive trade practices under Oklahoma insurance law, and violators will be subject to existing penalties and enforcement mechanisms. Oklahoma lawmakers voted unanimously in favor of the bill in both the House and Senate. The bill became law on May 29 and will go into effect on November 1.
This legislation aims to protect policyholders from potential fraud and abuse by third parties seeking to profit from insurance claims. By limiting the assignment of benefits, Oklahoma hopes to reduce the number of inflated claims and unnecessary legal disputes, ultimately leading to lower insurance costs for residents.
