Florida law now expressly allows many landlords to offer an alternative to a traditional security deposit: a fee in lieu of a security deposit. This statute—Fla. Stat. § 83.491—sets the rules for how that option must be offered, documented, and handled at move-out, including special timing requirements when a landlord uses insurance or a surety product.
This article breaks down what the law allows, what it requires, and the practical pros/cons for both landlords and tenants.
Important note: This is general legal information, not legal advice. Every lease and property situation is different.
What is a “fee in lieu of a security deposit”?
Under § 83.491, when a rental agreement would require a security deposit, a landlord may offer the tenant a different option:
- Pay a fee instead of paying the deposit up front (often a recurring monthly charge, but it can be scheduled differently if agreed).
- The tenant can still choose a traditional security deposit instead.
- The landlord can also allow the tenant to pay a security deposit in monthly installments (if both sides agree on the amount) while participating in the fee program.
Key concept
A fee in lieu is not a security deposit. It generally functions like an “access” or “move-in” alternative—it does not cap liability for damages or unpaid rent. Tenants can still owe money at move-out.
Who does the statute apply to?
The statute applies to rental agreements entered into or renewed on or after July 1, 2023.
The biggest confusion: “deposit replacement” does NOT mean “no liability”
The statute is designed to stop the misconception that paying a fee means a tenant is “covered.” The law requires written disclosures making clear that:
- The fee is only for securing occupancy without paying the deposit.
- The tenant’s obligations to pay rent, fees, and damage beyond normal wear and tear do not change.
- If the landlord uses some of the fee to purchase insurance, the tenant is not insured and is not a beneficiary.
Security deposit vs. fee in lieu: practical comparison
| Topic | Traditional Security Deposit | Fee in Lieu of Security Deposit |
|---|---|---|
| Up-front cost | Higher (often 1–2 months rent) | Lower up front; often paid monthly |
| Refundable? | Typically refundable minus lawful deductions | Often nonrefundable (depends on the agreement) |
| Limits tenant liability? | No—tenant can still owe more than the deposit | No—tenant can still owe for rent/damages |
| Move-out process | Governed by Florida’s security deposit rules | Governed by § 83.491 notice + documentation rules |
| If insurance is involved | Not typical | Possible; tenant still not “insured” |
| Best for… | Tenants who want potential refund; landlords who prefer deposit “skin in the game” | Tenants short on cash at move-in; landlords wanting a different risk structure |
Landlord obligations when offering a fee option
1) The fee option is voluntary—but if you offer it, you must follow the statute
Landlords have discretion whether to offer a fee option at all. However, once offered:
- You cannot treat a tenant’s choice to pay (or offer to pay) the fee as a negative factor in approving/denying the application.
- If you offer the option at a premises, you generally must offer the option to all new tenants renting a dwelling unit on the same premises (unless you prospectively terminate the program for all new rental agreements).
2) You must provide specific written disclosures
Before or at the time the tenant agrees to the fee program, the landlord must give written notice covering items such as:
- Tenant can switch to a security deposit at any time.
- Tenant can terminate the fee agreement and instead pay a deposit amount (as stated in the lease, or if none, the amount offered to new tenants for similar units at that time).
- Tenant may have the option to pay the deposit in installments (if agreed).
- Whether additional charges apply to switching options.
- The amount of payments for each option.
- Whether the fee is nonrefundable (if applicable).
- Clear statement that the fee does not change tenant obligations for rent, fees, and damages.
- If insurance is purchased with the fee: tenant is not insured and insurance does not change tenant obligations.
3) You must have a separate, signed written agreement (not just a lease clause)
If the tenant chooses the fee option, the statute requires a written agreement to collect the fee, signed by landlord/agent and tenant, that includes at least:
- Fee amount (cannot be increased during the lease term)
- How/when collected
- What happens if tenant defaults on the fee, including a process/timeframe to pay the security deposit instead
- Termination rights: tenant can terminate and pay the deposit instead
- Credit reporting protections if tenant timely pays the deposit after default/termination
Practical tip: Treat this as a standalone addendum with the required statutory disclosure language included.
Move-out and claims: what landlords must do (and what tenants should expect)
The 30-day notice requirement
If the tenant was in the fee program, the landlord must notify the tenant within 30 days after the tenancy ends if any costs/fees are due relating to:
- unpaid rent
- unpaid fees
- other lease obligations
- damages beyond normal wear and tear
The 15-day waiting period before submitting an insurance claim
If the landlord intends to recover losses through an insurer, the landlord generally must wait at least 15 days after providing the tenant notice before submitting a claim to an insurer.
Documentation required for insurance claims
When submitting a claim to an insurer, the landlord must include documentation such as:
- itemized unpaid amounts and due dates
- documentation supporting damages and repair costs
- tenant objections (if any) communicated in writing or otherwise documented
No “double dipping”
A landlord may not collect payment from both:
- the tenant, and
- an insurer
for the same rent/fees/damages.
If insurance pays the landlord: subrogation and tenant defenses
If an insurer pays the landlord’s claim and the insurer has subrogation rights, the insurer may seek reimbursement from the tenant (the statute provides a window—within 1 year after the tenancy ends).
If the insurer pursues the tenant:
- The insurer must provide the tenant the same supporting documentation the landlord provided plus a settlement statement of payment.
- The tenant keeps any defenses they would have had against the landlord (for example, disputes about causation, condition of the unit, wear and tear vs damage, documentation issues, etc.).
Timeline chart: how the statute’s deadlines tend to play out
| Time from move-out | Landlord step | Why it matters |
|---|---|---|
| Day 0 | Tenancy ends | Starts statutory timelines |
| By Day 30 | Landlord must notify tenant of amounts claimed due | Required notice for fee-program move-outs |
| At least 15 days after notice | Landlord may submit claim to insurer (if applicable) | Mandatory waiting period |
| Up to 1 year after tenancy ends | Insurer may pursue tenant for reimbursement (if subrogation applies) | Tenant should keep records |
Tenant guidance: how to evaluate the fee option
When the fee option may make sense
- You’re short on move-in cash and need a lower up-front cost.
- You don’t expect to stay long and don’t mind the fee being nonrefundable (if it is).
- You prefer predictable monthly payments over a large deposit.
When a traditional deposit may be better
- You expect to leave the unit in great condition and want the chance of a refund.
- The fee is high enough that over a year or two it exceeds a typical deposit.
- You want clearer move-out accounting in the traditional deposit framework.
Tenant checklist before signing
- Ask: Is the fee nonrefundable?
- Ask for a written breakdown of costs under each option.
- Confirm how you can switch to a deposit later, and whether any extra charges apply.
- If insurance is mentioned: confirm in writing that you are not insured and still responsible for obligations.
- Document the unit condition at move-in: photos/video, dated notes, maintenance requests.
Landlord guidance: compliance and risk control
Landlord compliance checklist
- ✅ Offer the fee option only if you can support the required disclosures and paperwork.
- ✅ Provide the required written notices explaining the tenant’s rights and the fee’s limits.
- ✅ Use a separate signed written agreement with the required terms and statutory disclosure.
- ✅ Keep strong records: ledgers, repair invoices, photos, inspection reports, correspondence.
- ✅ At move-out, track the 30-day notice deadline.
- ✅ If using insurance: track the 15-day waiting period and include required documentation.
- ✅ Avoid collecting from both the tenant and insurer for the same charges.
Common pitfalls that create disputes
- Treating the fee like a “deposit replacement” that eliminates tenant liability.
- Failing to give the required written disclosures and the separate fee agreement.
- Missing the post-tenancy notice window.
- Poor documentation (no photos, vague repair invoices, no itemization).
- Overreaching on “normal wear and tear” vs actual damage.
FAQ: Florida “Fee in Lieu of Security Deposit” (83.491)
1) Is the landlord required to offer a fee in lieu of a security deposit?
No. The landlord has discretion whether to offer it at all.
2) Can a tenant insist on paying a traditional security deposit instead?
If the landlord offers the fee option, the tenant must be told they can choose a security deposit instead and can switch to a deposit later.
3) Is the fee refundable at move-out?
It depends on the written agreement. The statute requires landlords to disclose if it is nonrefundable (and many are).
4) If I pay the fee, can I still be charged for damages or unpaid rent?
Yes. The fee does not limit or change tenant obligations for rent, fees, or damage beyond normal wear and tear.
5) Can the landlord raise the fee during the lease term?
No—under the statute, the agreement must state the fee amount and it may not be increased during the term of the rental agreement.
6) Does the landlord have to buy insurance with the fee?
No. The statute does not require the fee to be used to purchase insurance or a surety bond.
7) If the landlord has insurance, am I insured?
No. If the landlord uses the fee to purchase insurance, the tenant must be told the tenant is not insured and is not a beneficiary.
8) What notice does the landlord have to give after I move out?
If you were in the fee program, the landlord must notify you within 30 days after the tenancy ends if any amounts are claimed due for unpaid rent/fees/obligations or damages beyond normal wear and tear.
9) Can the insurer come after the tenant later?
Potentially yes, if the insurer paid the landlord and has subrogation rights. The statute allows an insurer to seek reimbursement within 1 year after the tenancy ends, and the tenant keeps defenses they’d have against the landlord.
10) Can the landlord collect from both the tenant and the insurer for the same damages?
No. The statute prohibits collecting payment from both for the same items.