Returning home from a relaxing weekend to find your living room flooded is a nightmare scenario. In a rush to resolve the issue, it’s easy to make a hasty decision, like calling the first water damage repair company that appears in your Google search. They arrive quickly, hand you some paperwork to sign, and start setting up equipment while reassuring you that they will handle everything with your insurance company.

Or consider another common scenario: a roofing contractor knocks on your door, claiming to have noticed a missing shingle. Before you know it, he’s inspected your roof, discovered damage, and is ready to have your insurance cover a new roof—all he needs is your signature on a form authorizing him to deal directly with your insurer.

While these offers might seem like convenient solutions, they are often examples of a problematic practice known as “Assignment of Benefits” (AOB). This arrangement can sometimes lead to inflated repair costs, unnecessary work, and even fraudulent lawsuits, ultimately causing a rise in home insurance premiums.

Understanding Assignment of Benefits

An Assignment of Benefits is a legal tool that transfers your insurance claims rights to another party. Commonly utilized by roofing companies, plumbing services, and water damage restoration firms, AOB agreements can lead to significant overcharging. In worst-case scenarios, the assigned contractor may sue your insurance provider over denied exaggerated charges, potentially resulting in a lien against your property if the dispute isn’t resolved.

Recognizing AOB Warning Signs

• Contractors who offer to handle your deductible or propose additional, unnecessary work.
• Repair personnel who quickly show up in your area following a disaster.
• Contracts specifically mentioning an Assignment of Benefits.

Why Contact Your Insurance First

Your insurance company likely has a list of vetted, reliable contractors known for professional and timely service. These approved providers typically won’t ask you to sign an AOB, ensuring that you maintain control over your insurance benefits. The insurance company usually coordinates directly with these contractors while managing your claim.

Steps to Take Before Signing Any Contract

• Request a detailed written proposal including total costs, project scope, and timeline.
• Scrutinize the contract for any mention of Assignment of Benefits.
• Take your time to make an informed decision without pressure.

Remember, if you’re ever uncertain about a potential claim or contractor, don’t hesitate to contact us at Niceville Insurance Agency. We’re here to help ensure that your insurance claims process is smooth and secure.