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Bill

SB 1154

Fire insurance; assignment of claims prohibited.

2025 Regular Session Introduced by Bill DeSteph and 1 co-sponsor

Virginia bans fire insurance claim assignments to third parties without insurer consent, effective July 1, 2025, restricting direct contractor payment arrangements.

Acts of Assembly Chapter text (CHAP0134)
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Bill Summary · SB 1154

Legislative bill overview

SB 1154 prohibits policyholders from assigning their fire insurance claims to third parties without explicit written consent from their insurance company. The bill effectively bans assignment of benefits agreements that have become common in the property damage restoration industry, where homeowners assign claim payments directly to contractors.

Why is this important

This legislation directly impacts how homeowners handle insurance claims after fires or major property damage. It shifts negotiating power back to insurers by preventing contractors from receiving direct payment from claims, potentially affecting repair timelines, contractor incentives, and homeowner access to certain service providers who rely on assignment agreements for payment security.

Potential points of contention

  • Contractor impact: Restoration companies that depend on claim assignments for cash flow may struggle or exit the market, potentially reducing service availability and competition in emergency repair services
  • Consumer choice: Homeowners lose the ability to direct their claim payments to preferred contractors, limiting flexibility in how they manage their recovery process
  • Insurer discretion: Giving insurers veto power over assignments could enable selective consent denials, though this depends on regulatory guidance and enforcement

Compiled from official sources — confirm details with the bill’s official record.

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