Citizens Property Insurance lost its bid to invalidate assignment of benefits agreements listing depreciation as an insured responsibility, a Florida appeals court ruled.
The Third District Court of Appeal ruled February 4 that an assignment agreement between a water mitigation company and hurricane-damaged homeowners remained valid even though it listed depreciation as the insured's responsibility, a provision not explicitly mentioned in state law.
The decision reversed a Miami-Dade County Court ruling that had dismissed Spartan Services Corp.'s $17,272 breach of contract claim against Citizens for lack of standing.
The case stems from Hurricane Ian damage to a Miami home owned by Paula Villa and Maykel Garcia in 2022. The couple signed an assignment of benefits agreement with Spartan Services on December 14, 2022, for water mitigation work. The agreement included language stating that clients must pay for any portion of work, deductibles, betterment, depreciation or additional work not relating to the subject claim on or before completion.
Spartan completed the work and submitted its invoice to Citizens. The insurer acknowledged the loss, assigned an adjustor and claim number, and conducted an investigation. But when it came time to pay, Citizens refused, arguing the assignment agreement violated Florida law and was therefore invalid.
Citizens' position centered on section 627.7152(7)(b) of the Florida Statutes, which lists three things insureds remain responsible for under assignment agreements: deductibles, approved betterment, and work performed before an assignment is rescinded. Because depreciation doesn't appear on that list, Citizens contended that including it in the assignment agreement rendered the entire document invalid.
The trial court agreed and dismissed Spartan's lawsuit in August 2024, finding the company had no standing to sue without a valid assignment.
But the appeals court saw things differently. Chief Judge Scales noted that Citizens failed to cite any authority supporting its interpretation that the statute's list is exhaustive or that adding depreciation invalidates an assignment.
The court found guidance in a strikingly similar case from Florida's Second District Court of Appeal. In Well Done Mitigation v. Citizens Property Insurance Corp., decided in 2025, another water mitigation company had used nearly identical assignment language, also tracking the statutory requirements but adding depreciation to the insured's responsibilities.
The Second District reversed a trial court dismissal in that case, holding the assignment remained valid. The Third District followed suit.
The appeals court explained that while Florida law does prescribe extensive requirements for valid assignment agreements, and specifically states that non-compliant agreements are invalid and unenforceable, Citizens hadn't identified any actual requirement that the agreement failed to meet.
Instead, Citizens was asking the court to read into the law an implicit prohibition that simply isn't there. The statute lists what insureds must pay, but it doesn't forbid assignment agreements from clarifying or expanding those responsibilities, the court concluded.
The court declined what it called Citizens' invitation to rewrite the statute, remanding the case for further proceedings. The decision won't be final until any rehearing motions are resolved.
The ruling adds to a growing body of appellate precedent on assignment of benefits agreements, which have been a persistent source of litigation and legislative attention in Florida's property insurance market. The decisions suggest Florida's appellate courts are converging on an interpretation that favors the validity of these agreements when they expand, rather than limit, insured responsibilities beyond the statutory minimums.
