assignment benefit definition

Assignment of Benefits: What It Is, and How It Can Affect your Property Insurance Claim

Table of Contents

What is an Assignment of Benefits?

In the context of insured property claims, an assignment of benefits (AOB) is an agreement between you and a contractor in which you give the contractor your right to insurance payments for a specific scope of work . In exchange, the contractor agrees that it will not seek payment from you for that scope of work, except for the amount of any applicable deductible. In other words, you give part of your insurance claim to your contractor, and your contractor agrees not to collect from you for part of its work.

The most important thing to know about an assignment of benefits is that it puts your contractor in control your claim , at least for their scope of work. Losing that control can significantly affect the direction and outcome of your claim, so you should fully understand the implications of an AOB (sometimes called an assignment of claims or AOC) before signing one.

How Does an Assignment of Benefits Work in Practice?

Let’s say you’re an insured homeowner, and Hurricane Ian significantly damaged your roof. Let’s also assume your homeowner’s policy covers that damage. A roofer, after inspecting your roof and reviewing your insurance policy, might conclude that your insurer is probably going to pay for a roof replacement under your insurance policy. The only problem is that it’s early in the recovery process, and your insurer hasn’t yet stated whether it will pay for the roof replacement proposed by your contractor. So if you want your roof replaced now, you would ordinarily agree to pay your roofer for the replacement, and wait in hopes that your insurer reimburses you for the work. This means that if your insurance company refuses to pay or drags out payment, you’re on the hook to your roofer for the cost of the replacement.

As an alternative to agreeing to pay your roofer for the full cost of the work, you could sign an assignment of benefits for the roof replacement. In this scenario, your roofer owns the part of your insurance claim that pertains to the roof replacement. You might have to pay your roofer for the amount of your deductible, but you probably don’t have to pay them for the rest of the cost of the work. And if your insurance company refuses to pay or drags out payment for the roof replacement, it’s your roofer, and not you, who would be on the hook for that shortfall.

So should you sign an AOB? Not necessarily. Read below to understand the pros and cons of an assignment of benefits.

Are There any Downsides to Signing an Assignment of Benefits?

Yes.

You lose control of your claim . This is the most important factor to understand when considering whether to sign an AOB. An AOB is a formal assignment of your legal rights to payment under your insurance contract. Unless you’re able to cancel the AOB, your contractor will have full control over your claim as it relates to their work.

To explain why that control could matter, let’s go back to the roof replacement example. When you signed the AOB, the scope of work you agreed on was to replace the roof. But you’re not a roofing expert, so you don’t know whether the costs charged or the materials used by the roofer in its statement of work are industry appropriate or not. In most cases, they probably are appropriate, and there’s no problem. But if they’re not – if, for instance, the roofer’s prices are unreasonably high – then the insurer may not approve coverage for the replacement. At that point, the roofer could lower its prices so the insurer approves the work, but it doesn’t have to, because it controls the claim . Instead it could hold up work and threaten to sue your insurer unless it approves the work at the originally proposed price. Now the entire project is insnared in litigation, leaving you in a tough spot with your insurer for your other claims and, most importantly, with an old leaky roof.

Misunderstanding the Scope of Work. Another issue that can arise is that you don’t understand the scope of the assignment of benefits. Contractor estimates and scopes of work are often highly technical documents that can be long on detail but short on clarity. Contractors are experts at reading and writing them. You are not. That difference matters because the extent of your assignment of benefits is based on that technical, difficult-to-understand scope of work. This can lead to situations where your understanding of what you’re authorizing the contractor to do is very different from what you’ve actually authorized in the AOB agreement.

In many cases, it’s not necessary . Many contractors will work with you and your insurer to provide a detailed estimate of their work, and will not begin that work until your insurer has approved coverage for it. This arrangement significantly reduces the risk of you being on the hook for uninsured repairs, without creating any of the potential problems that can occur when you give away your rights to your claim.

Do I have to sign an Assignment of Benefits?

No. You are absolutely not required to sign an AOB if you do not want to.

Are There any Benefits to Signing an Assignment of Benefits?

Potentially, but only if you’ve fully vetted your contractor and your claim involves complicated and technical construction issues that you don’t want to deal with.

First, you must do your homework to fully vet your contractor! Do not just take their word for it or be duped by slick ads. Read reviews, understand their certificate of insurance, know where they’re located, and, if possible, ask for and talk to references. If you’ve determined that the contractor is highly competent at the work they do, is fully insured, and has a good reputation with customers, then that reduces the risk that they’ll abuse their rights to your claim.

Second, if your claim involves complicated reconstruction issues, a reputable contractor may be well equipped to handle the claim and move it forward. If you don’t want to deal with the hassle of handling a complicated claim like this, and you know you have a good contractor, one way to get rid of that hassle is an AOB.

Another way to get rid of the hassle is to try Claimly, the all-in-one claims handling tool that get you results but keeps you in control of your claim.

Can my insurance policy restrict the use of AOBs?

Yes, it’s possible that your Florida insurance policy restricts the use of AOBs, but only if all of the following criteria are met:

When you selected your coverage, your insurer offered you a different policy with the same coverage, only it did not restrict the right to sign an AOB.
Your insurer made the restricted policy available at a lower cost than the unrestricted policy.
If the policy completely prohibits AOBs, then it was made available at a lower cost than any policy partially prohibiting AOBs.
The policy includes on its face the following notice in 18-point uppercase and boldfaced type:

THIS POLICY DOES NOT ALLOW THE UNRESTRICTED ASSIGNMENT OF POST-LOSS INSURANCE BENEFITS. BY SELECTING THIS POLICY, YOU WAIVE YOUR RIGHT TO FREELY ASSIGN OR TRANSFER THE POST-LOSS PROPERTY INSURANCE BENEFITS AVAILABLE UNDER THIS POLICY TO A THIRD PARTY OR TO OTHERWISE FREELY ENTER INTO AN ASSIGNMENT AGREEMENT AS THE TERM IS DEFINED IN SECTION 627.7153 OF THE FLORIDA STATUTES.

627.7153.

Pro Tip : If you have an electronic copy of your complete insurance policy (not just the declaration page), then search for “policy does not allow the unrestricted assignment” or another phrase from the required language above to see if your policy restricts an AOB. If your policy doesn’t contain this required language, it probably doesn’t restrict AOBs.

Do I have any rights or protections concerning Assignments of Benefits?

Yes, you do. Florida recently enacted laws that protect consumers when dealing with an AOB.

Protections in the AOB Contract

To be enforceable, a Assignments of Benefits must meet all of the following requirements:

Be in writing and executed by and between you and the contractor.
Contain a provision that allows you to cancel the assignment agreement without a penalty or fee by submitting a written notice of cancellation signed by the you to the assignee:
at least 30 days after the date work on the property is scheduled to commence if the assignee has not substantially performed, or
at least 30 days after the execution of the agreement if the agreement does not contain a commencement date and the assignee has not begun substantial work on the property.
Contain a provision requiring the assignee to provide a copy of the executed assignment agreement to the insurer within 3 business days after the date on which the assignment agreement is executed or the date on which work begins, whichever is earlier.
Contain a written, itemized, per-unit cost estimate of the services to be performed by the assignee .
Relate only to work to be performed by the assignee for services to protect, repair, restore, or replace a dwelling or structure or to mitigate against further damage to such property.
Contain the following notice in 18-point uppercase and boldfaced type:

YOU ARE AGREEING TO GIVE UP CERTAIN RIGHTS YOU HAVE UNDER YOUR INSURANCE POLICY TO A THIRD PARTY, WHICH MAY RESULT IN LITIGATION AGAINST YOUR INSURER. PLEASE READ AND UNDERSTAND THIS DOCUMENT BEFORE SIGNING IT. YOU HAVE THE RIGHT TO CANCEL THIS AGREEMENT WITHOUT PENALTY WITHIN 14 DAYS AFTER THE DATE THIS AGREEMENT IS EXECUTED, AT LEAST 30 DAYS AFTER THE DATE WORK ON THE PROPERTY IS SCHEDULED TO COMMENCE IF THE ASSIGNEE HAS NOT SUBSTANTIALLY PERFORMED, OR AT LEAST 30 DAYS AFTER THE EXECUTION OF THE AGREEMENT IF THE AGREEMENT DOES NOT CONTAIN A COMMENCEMENT DATE AND THE ASSIGNEE HAS NOT BEGUN SUBSTANTIAL WORK ON THE PROPERTY. HOWEVER, YOU ARE OBLIGATED FOR PAYMENT OF ANY CONTRACTED WORK PERFORMED BEFORE THE AGREEMENT IS RESCINDED. THIS AGREEMENT DOES NOT CHANGE YOUR OBLIGATION TO PERFORM THE DUTIES REQUIRED UNDER YOUR PROPERTY INSURANCE POLICY.

Contain a provision requiring the assignee to indemnify and hold harmless the assignor from all liabilities, damages, losses, and costs, including, but not limited to, attorney fees.

Contractor Duties

Under Florida law, a contractor (or anyone else) receiving rights to a claim under an AOB:

Must provide you with accurate and up-to-date revised estimates of the scope of work to be performed as supplemental or additional repairs are required.
Must perform the work in accordance with accepted industry standards.
May not seek payment from you exceeding the applicable deductible under the policy unless asked the contractor to perform additional work at the your own expense.
Must, as a condition precedent to filing suit under the policy, and, if required by the insurer, submit to examinations under oath and recorded statements conducted by the insurer or the insurer’s representative that are reasonably necessary, based on the scope of the work and the complexity of the claim, which examinations and recorded statements must be limited to matters related to the services provided, the cost of the services, and the assignment agreement.
Must, as a condition precedent to filing suit under the policy, and, if required by the insurer, participate in appraisal or other alternative dispute resolution methods in accordance with the terms of the policy.
If the contractor is making emergency repairs, the assignment of benefits cannot exceed the greater of $3,000 or 1% of your Coverage A limit.

Assignment of benefits

Assignment of benefits is an agreement that gives your claims benefits to someone else.

What is an assignment of benefits?

An assignment of benefits (or AOB for short) is an agreement that gives your claims benefits, and in some instances complete control of your claim, to someone else. It’s usually used so that a contractor can "stand in your shoes" and file a claim, make decisions about repairs, and collect insurance payments from your insurance company directly for covered repairs. In some states, the contractor will even file a lawsuit against your insurer as your assignee.

Why do homeowners agree to an assignment of benefits?

Homeowners may sign an assignment of benefits form because they think it’s more convenient and efficient than dealing with the claims process firsthand.

Once a contractor has been assigned your benefits, they tell the insurance company what work they believe is required and negotiate the claim. For example, say you have a water leak in the house. You call a home restoration company to stop the water flow, clean up the mess, and restore your home to its former glory. The restoration company may ask for an assignment of benefits so it can deal directly with the insurance company without your input. That may sound like a relief at first glance – someone else can deal with all that!

But signing away your rights in the claims process may not be worth the risk.

Assignment of benefits in Florida: a case of rampant fraud

Because the assignment of benefits takes control out of the homeowner’s hands, insurance fraud is a major concern. Some contractors may take advantage of the situation and inflate repair needs and costs or bill for work that was never completed. They may also hire attorneys to sue the insurance company if it does not pay the full amount of their estimate or denies claims.

These lawsuits became a huge problem in Florida – by 2018, there were 135,000 AOB lawsuits , a 70 percent increase in 15 years. On the whole, the FBI estimates fraudulent claims account for nearly $6 billion of the $80 billion appropriated for post-hurricane reconstruction.

Florida eventually passed a bill in 2019 to curb the abuse of the assignment of benefits.

Ultimately, AOB fraud hurts homeowners the most. It increases homeowners insurance rates across the board, and you may be stuck with incomplete work and no recourse.

What responsibilities does the AOB contractor have?

Once you sign an AOB, a contractor has full power to make all decisions about the claim without consulting you. The assignment of benefits gives contractors the ability to:

File the insurance claim .
Work directly with insurance claims adjusters.
Make repair decisions.
Complete repairs.
Directly bill the insurance carrier for all work completed.
Sue your insurance company regarding your claim.

Sometimes the assignment of benefits limits the scope of the work the contractor was hired for. For example, say your home has a leaky pipe. You may hire a plumber to fix the leak, a remediation company to dry the walls and carpet, and a general contractor to replace the bathroom cabinets. Each of the three contractors may have a respective assignment of benefits for their part of the job.

How assignment of benefits impact homeowners

Under some circumstances, an assignment of benefits agreement could work out for homeowners who don’t want to handle their insurance claim. If the contractor is reputable, performs the work, and knows what information the insurance company needs, it can be a big help.

For example:

The claims adjuster will work directly with the contractor.
The contractor would handle remediation and repairs.
The contractor would bill the insurance company, not the homeowner.

AOB arrangements only work for covered damage in need of repair. If you must replace belongings or appliances, you’d still need to work directly with your insurer and payments would go to you.

Protecting yourself in an assignment of benefits agreement

Don’t sign an assignment of benefits agreement right off the bat. Before you hire any contractor:

Get multiple quotes.
Check references, licenses, and their insurance.
Get written estimates for potential work.
Get a guarantee to back the workmanship.
Make sure you get to approve the completed work.
Request copies of all paperwork sent to your insurance company.
Require that the contractor show you the documents you are actually signing.

You might be tempted to hire the first contractor you find, but you save yourself headaches if you do some due diligence before signing an assignment of benefits. Great contractors use this to expedite repairs and spare you some work. Take a beat to find that great contractor.

Practice Areas

Retirement Planning

Assignment of Benefits: What You Need to Know

August 17, 2022
Steven Schwartzapfel

Insurance can be useful, but dealing with the back-and-forth between insurance companies and contractors, medical specialists, and others can be a time-consuming and ultimately unpleasant experience. You want your medical bills to be paid without having to act as a middleman between your healthcare provider and your insurer.

However, there’s a way you can streamline this process. With an assignment of benefits, you can designate your healthcare provider or any other insurance payout recipient as the go-to party for insurance claims. While this can be convenient, there are certain risks to keep in mind as well.

Below, we’ll explore what an assignment of insurance benefits is (as well as other forms of remediation), how it works, and when you should employ it. For more information, or to learn whether you may have a claim against an insurer, contact Schwartzapfel Lawyers now at 1-516-342-2200 .

What Is an Assignment of Benefits?

An assignment of benefits (AOB) is a legal process through which an insured individual or party signs paperwork that designates another party like a contractor, company, or healthcare provider as their insurance claimant .

Suppose you’re injured in a car accident and need to file a claim with your health insurance company for medical bills and related costs. However, you also need plenty of time to recover. The thought of constantly negotiating between your insurance company, your healthcare provider, and anyone else seems draining and unwelcome.

With an assignment of benefits, you can designate your healthcare provider as your insurance claimant. Then, your healthcare provider can request insurance payouts from your healthcare insurance provider directly.

Through this system, the health insurance provider directly pays your physician or hospital rather than paying you. This means you don’t have to pay your healthcare provider. It’s a streamlined, straightforward way to make sure insurance money gets where it needs to go. It also saves you time and prevents you from having to think about insurance payments unless absolutely necessary.

What Does an Assignment of Benefits Mean?

An AOB means that you designate another party as your insurance claimant. In the above example, that’s your healthcare provider, which could be a physician, hospital, or other organization.

With the assignment of insurance coverage, that healthcare provider can then make a claim for insurance payments directly to your insurance company. The insurance company then pays your healthcare provider directly, and you’re removed as the middleman.

As a bonus, this system sometimes cuts down on your overall costs by eliminating certain service fees. Since there’s only one transaction — the transaction between your healthcare provider and your health insurer — there’s only one set of service fees to contend with. You don’t have to deal with two sets of service fees from first receiving money from your insurance provider, then sending that money to your healthcare provider.

Ultimately, the point of an assignment of benefits is to make things easier for you, your insurer, and anyone else involved in the process.

What Types of Insurance Qualify for an Assignment of Benefits?

Most types of commonly held insurance can work with an assignment of benefits. These insurance types include car insurance, healthcare insurance, homeowners insurance, property insurance, and more.

Note that not all insurance companies allow you to use an assignment of benefits. For an assignment of benefits to work, the potential insurance claimant and the insurance company in question must each sign the paperwork and agree to the arrangement. This prevents fraud (to some extent) and ensures that every party goes into the arrangement with clear expectations.

If your insurance company does not accept assignments of benefits, you’ll have to take care of insurance payments the traditional way. There are many reasons why an insurance company may not accept an assignment of benefits.

To speak with a Schwartzapfel Lawyers expert about this directly, call 1-516-342-2200 for a free consultation today. It will be our privilege to assist you with all your legal questions, needs, and recovery efforts.

Who Uses Assignments of Benefits?

Many providers, services, and contractors use assignments of benefits. It’s often in their interests to accept an assignment of benefits since they can get paid for their work more quickly and make critical decisions without having to consult the insurance policyholder first.

Imagine a circumstance in which a homeowner wants a contractor to add a new room to their property. The contractor knows that the scale of the project could increase or shrink depending on the specifics of the job, the weather, and other factors.

If the homeowner uses an assignment of benefits to give the contractor rights to make insurance claims for the project, that contractor can then:

Bill the insurer directly for their work. This is beneficial since it ensures that the contractor’s employees get paid promptly and they can purchase the supplies they need.
Make important decisions to ensure that the project completes on time. For example, a contract can authorize another insurance claim for extra supplies without consulting with the homeowner beforehand, saving time and potentially money in the process.

Practically any company or organization that receives payments from insurance companies may choose to take advantage of an assignment of benefits with you. Example companies and providers include:

Ambulance services
Drug and biological companies
Lab diagnostic services
Hospitals and medical centers like clinics
Certified medical professionals such as nurse anesthetists, nurse midwives, clinical psychologists, and others
Ambulatory surgical center services
Permanent repair and improvement contractors like carpenters, plumbers, roofers, restoration companies, and others
Auto repair shops and mechanic organizations

Advantages of Using an Assignment of Benefits

An assignment of benefits can be an advantageous contract to employ, especially if you believe that you’ll need to pay a contractor, healthcare provider, and/or other organization via insurance payouts regularly for the near future.

These benefits include but are not limited to:

Save time for yourself. Again, imagine a circumstance in which you are hospitalized and have to pay your healthcare provider through your health insurance payouts. If you use an assignment of benefits, you don’t have to make the payments personally or oversee the insurance payouts. Instead, you can focus on resting and recovering.
Possibly save yourself money in the long run. As noted above, an assignment of benefits can help you circumvent some service fees by limiting the number of transactions or money transfers required to ensure everyone is paid on time.
Increased peace of mind. Many people don’t like having to constantly think about insurance payouts, contacting their insurance company, or negotiating between insurers and contractors/providers. With an assignment of benefits, you can let your insurance company and a contractor or provider work things out between them, though this can lead to applications later down the road.

Because of these benefits, many recovering individuals, car accident victims, homeowners, and others utilize AOB agreements from time to time.

Risks of Using an Assignment of Benefits

Worth mentioning, too, is that an assignment of benefits does carry certain risks you should be aware of before presenting this contract to your insurance company or a contractor or provider. Remember, an assignment of benefits is a legally binding contract unless it is otherwise dissolved (which is technically possible).

The risks of using an assignment of benefits include:

You give billing control to your healthcare provider, contractor, or another party. This allows them to bill your insurance company for charges that you might not find necessary. For example, a home improvement contractor might bill a homeowner’s insurance company for an unnecessary material or improvement. The homeowner only finds out after the fact and after all the money has been paid, resulting in a higher premium for their insurance policy or more fees than they expected.
You allow a contractor or service provider to sue your insurance company if the insurer does not want to pay for a certain service or bill. This can happen if the insurance company and contractor or service provider disagree on one or another billable item. Then, you may be dragged into litigation or arbitration you did not agree to in the first place.
You may lose track of what your insurance company pays for various services . As such, you could be surprised if your health insurance or other insurance premiums and deductibles increase suddenly.

Given these disadvantages, it’s still wise to keep track of insurance payments even if you choose to use an assignment of benefits. For example, you might request that your insurance company keep you up to date on all billable items a contractor or service provider charges for the duration of your treatment or project.

For more on this and related topic, call Schwartzapfel Lawyers now at 1-516-342-2200 .

How To Make Sure an Assignment of Benefits Is Safe

Even though AOBs do carry potential disadvantages, there are ways to make sure that your chosen contract is safe and legally airtight. First, it’s generally a wise idea to contact knowledgeable legal representatives so they can look over your paperwork and ensure that any given assignment of benefits doesn’t contain any loopholes that could be exploited by a service provider or contractor.

The right lawyer can also make sure that an assignment of benefits is legally binding for your insurance provider. To make sure an assignment of benefits is safe, you should perform the following steps:

Always check for reviews and references before hiring a contractor or service provider, especially if you plan to use an AOB ahead of time. For example, you should stay away if a contractor has a reputation for abusing insurance claims.
Always get several estimates for work, repairs, or bills. Then, you can compare the estimated bills and see whether one contractor or service provider is likely to be honest about their charges.
Get all estimates, payment schedules, and project schedules in writing so you can refer back to them later on.
Don’t let a service provider or contractor pressure you into hiring them for any reason . If they seem overly excited about getting started, they could be trying to rush things along or get you to sign an AOB so that they can start issuing charges to your insurance company.
Read your assignment of benefits contract fully. Make sure that there aren’t any legal loopholes that a contractor or service provider can take advantage of. An experienced lawyer can help you draft and sign a beneficial AOB contract.

Can You Sue a Party for Abusing an Assignment of Benefits?

Sometimes. If you believe your assignment of benefits is being abused by a contractor or service provider, you may be able to sue them for breaching your contract or even AOB fraud. However, successfully suing for insurance fraud of any kind is often difficult.

Also, you should remember that a contractor or service provider can sue your insurance company if the insurance carrier decides not to pay them. For example, if your insurer decides that a service provider is engaging in billing scams and no longer wishes to make payouts, this could put you in legal hot water.

If you’re not sure whether you have grounds for a lawsuit, contact Schwartzapfel Lawyers today at 1-516-342-2200 . At no charge, we’ll examine the details of your case and provide you with a consultation. Don’t wait. Call now!

Assignment of Benefits FAQs

Which states allow assignments of benefits.

Every state allows you to offer an assignment of benefits to a contractor and/or insurance company. That means, whether you live in New York, Florida, Arizona, California, or some other state, you can rest assured that AOBs are viable tools to streamline the insurance payout process.

Can You Revoke an Assignment of Benefits?

Yes. There may come a time when you need to revoke an assignment of benefits. This may be because you no longer want the provider or contractor to have control over your insurance claims, or because you want to switch providers/contractors.

To revoke an assignment of benefits agreement, you must notify the assignee (i.e., the new insurance claimant). A legally solid assignment of benefits contract should also include terms and rules for this decision. Once more, it’s usually a wise idea to have an experienced lawyer look over an assignment of benefits contract to make sure you don’t miss these by accident.

Contact Schwartzapfel Lawyers Today

An assignment of benefits is an invaluable tool when you need to streamline the insurance claims process. For example, you can designate your healthcare provider as your primary claimant with an assignment of benefits, allowing them to charge your insurance company directly for healthcare costs.

However, there are also risks associated with an assignment of benefits. If you believe a contractor or healthcare provider is charging your insurance company unfairly, you may need legal representatives. Schwartzapfel Lawyers can help.

As knowledgeable New York attorneys who are well-versed in New York insurance law, we’re ready to assist with any and all litigation needs. For a free case evaluation and consultation, contact Schwartzapfel Lawyers today at 1-516-342-2200 !

Schwartzapfel Lawyers, P.C. | Fighting For You™™

What Is an Insurance Claim? | Experian

What is assignment of benefits, and how does it impact insurers? | Insurance Business Mag

Florida Insurance Ruling Sets Precedent for Assignment of Benefits | Law.com

What is preponderance of evidence.

If you watch crime shows, you’ve likely heard the phrase “innocent until proven guilty.” That’s true as a framework, especially

When Is It Too Late To Get A Lawyer For A Car Accident?

Car accidents are not only frightening but can also result in substantial financial costs. Between mounting medical bills, the potential

Motion Of Discovery: What Does It Actually Mean?

Court processes often require motions. Motions are filed by legal teams to initiate different phases of a case or to

We'll Fight For You

Schwartzapfel® lawyers has a 99% client satisfaction rate, quick links.

News & Events
Verdicts & Settlements
Video Gallery
Wrongful Death
Vehicle Accidents
Slip & Fall
Medical Malpractice
Workers' Compensation
Personal Injuries
Product Liability
Garden City

Home » Coverage Exclusions » Assignment of Benefits

Assignment of Benefits for Homeowners

How It Works
Using Your AOB
Pros & Cons
Safe & Secure
Watch Out for Abuse
Frequently Asked Questions

An assignment of benefits (AOB) is a contractual agreement that enables a third party to access insurance benefits on behalf of the policyholder.[1] When the policyholder signs an AOB agreement, it grants the third party the authority to initiate an insurance claim and receive reimbursement directly from the insurance company.

Assignment of benefits for homeowners means that any contractors , plumbers, or other professionals who perform work to repair your home or property after a claim can work with your insurance provider directly to get compensated. You step aside as the middleman, and they work together.

While AOB can work with most types of insurance, not every insurance company will allow it. The party performing the work (the insurance claimant) and your insurance company must both agree to the process.

As the policyholder, you must willingly sign an AOB agreement, giving explicit consent for a third party to access their insurance benefits.
AOBs may make things easier for both you as the policyholder and for the service provider.
The service provider takes care of filing the claim, helps the homeowner decide on repairs, and gets paid by the insurance company, relieving you (the policyholder) of having to manage these details.

How Do Assignment of Benefits Work?

AOB is a straightforward process that simplifies insurance billing for both service providers and policyholders. Here is how an AOB works.

Coverage Verified

Before hiring a service provider, the policyholder must make sure that the service is covered by their policy by checking in with the insurance provider. Homeowners insurance pays for the cost of damages or loss due to a covered event, as outlined in the policy.

Mutual Agreement

The policyholder and the service provider agree to utilize an AOB form.[2] This agreement authorizes the service provider to handle direct billing to the insurance company for the services provided.

Billing Submission

With the AOB form in place, the service provider submits all relevant documentation, including invoices and service records, to the insurance company for payment. In many cases, this includes the initial claim with documentation of the damage and an explanation/proof of how it happened.

Claim Evaluation

The insurance company thoroughly reviews the submitted documents to verify that the damage itself and the provided services are indeed covered under the policy terms and that the contractor provided those same services.

Direct Payment

If the services are eligible and covered by the insurance policy, the insurance company promptly issues payment directly to the service provider. This payment aligns with the agreed-upon costs as outlined in the insurance policy.

Policyholder’s Responsibility

Generally, the policyholder is only responsible for any deductibles, copays, or out-of-pocket expenses specified in their insurance policy.[3] They are relieved of the responsibility of managing the billing process or handling reimbursement paperwork.

Service Rendered

The policyholder receives necessary services covered by their insurance policy, such as medical treatment or repairs.

Example of an Assignment of Benefits

A hurricane hit Rachel’s town, severely damaging the shed where she keeps her tools and lawn equipment. The shed is covered under her home insurance policy, and she files a claim with the insurance provider quickly with photographs and documents that show the damage and provide proof of the value and potential cost to rebuild. The insurance provider approves the replacement of the shed.

To streamline the process of paying the contractor, Rachel signs an AOB allowing the contractor to bill the insurance provider rather than billing her. This means that if there are any disputes about the costs of materials, timeliness of payment, or any other issues, those will happen between the insurance company and the contractor, and Rachel will not be required to step in.

Additionally, rather than having to pay the contractor out of pocket and wait for a reimbursement check from the provider, the contractor will be paid directly by the insurance company, so Rachel doesn’t have to pay the cost of the shed replacement.

When Would You Use Your Assignment of Benefits?

AOBs can be useful in various situations:

Assign benefits to contractors for property damage repairs, simplifying the insurance claim process. It can often expedite the process and help claimants to get paid faster.
AOBs can help in emergencies, ensuring timely payment without paperwork hassles. This can be particularly helpful during already high-stress times.
Consider AOBs for complex claims with multiple providers or extensive paperwork. You’ll have less to manage if the parties work together directly.
You can use an AOB for a range of professionals relating to a homeowners insurance claim, such as plumbers, roofers, window repair specialists, landscapers, carpenters, and restoration specialists.

Pros & Cons of Using Assignment of Benefits



It simplifies the claims process, reducing paperwork for policyholders.	Policyholders may have limited control over claims and disputes.
Service providers can bill insurance companies directly, ensuring timely payment.	With AOBs, the insurance company may not agree to cover the full cost, and the contractor may sue the insurance company. You may be dragged into litigation later. The company may also deny the claim altogether.
It allows policyholders to access needed services, even when funds are limited.	Your lack of visibility into final bills may mean you’re surprised when your insurance premiums are raised.
	There is a possibility that the assignee can pocket any additional funds you may be due as part of the settlement.

Making Sure Your AOB Is Safe & Secure

To ensure the safety of an AOB:

Check the reputation of the service provider and seek multiple quotes for services.[4]
Carefully examine the AOB terms, ensuring clarity and alignment with your insurance policy.
Beware of high-pressure tactics and take your time to decide.
Confirm the provider’s licensing and insurance.
Get multiple estimates in writing for the needed work.
Consult an attorney or insurance advisor if you have concerns.
Keep records of communication and contracts.
Inform your insurer about the AOB and their requirements.
After services, check the results against AOB terms and your satisfaction.
Make sure the AOB has appropriate cancellation provisions in place so that you can rescind the agreement in writing in certain circumstances.

Assignment of Benefits Being Abused: What Are My Options?

While an AOB can offer convenience, the process may be susceptible to misuse by those who would take advantage of the insurance company and overcharge for services or claim to have provided services that they did not actually perform. Lisa Koosis, a former claims specialist, warns, “Be watchful for AOB scams, particularly after natural disasters such as earthquakes or hurricanes. Red flags include contractors who offer something for nothing, make exaggerated claims of damage or present broadly worded contracts.”

If you suspect AOB abuse or fraud, consider these options.

Contact Your Insurer

If you suspect AOB abuse, promptly reach out to your insurance company. Express your concerns and provide any evidence you have to support them. Insurers have units dedicated to investigating potential fraud or AOB misuse.

Report Fraud

If you suspect fraudulent activities, report the issue to your state’s insurance fraud bureau or department, which investigates such cases and takes legal action when appropriate. However, fraud is generally difficult to prove.

Seek Legal Counsel

Get advice from an attorney who is experienced in insurance claims to navigate your specific situation. Be aware that pursuing legal action can be costly and lengthy, so it generally won’t be your first course of action. But if the process gets complicated, it’s helpful to have a legal professional on your side. Lisa Koosis, a former claims specialist, says, “If you need legal assistance but can’t afford it, try calling your local law school. Many of them offer free clinics where you can get a consultation and, sometimes, pro bono representation.”

Know About Potential Litigation

If the contractor or service provider isn’t paid by your insurance company, they might pursue legal action against your provider, leading to a dispute that may require your action or response.

Frequently Asked Questions About Assignment of Benefits (AOB) for Homeowners

We have compiled some of the most frequently asked questions about AOBs and how to use them most effectively, so you can make the most informed decisions about your situation.

An assignment of benefits, also referred to as an AOB, in homeowners insurance is when you allow a contractor or service provider to take over your insurance claim process. They deal directly with the insurance company for tasks like repairs or damage assessments and get paid directly. This can simplify and expedite the process because the service provider is dealing directly with your insurance company without you serving as the intermediary.

All parties must agree to the process. As the policyholder, you’ll sign off on the process, and both the services provider and your insurance company must also agree to the process.

Using an AOB can be beneficial if it is used wisely and for the purposes of working with reputable service providers. It streamlines claims, but it also comes with potential risks like fraud. Proceed with caution and agree to an AOB only if you feel confident that you are working with trusted parties. Also, be aware that not all insurance companies allow AOBs. Some states prohibit AOBs for certain types of work. Consult your insurance provider to ensure they do before proceeding.

In recent years, AOBs have been the target of fraud. Some service providers have inflated their invoices, billing for work that wasn’t performed. In some cases, claimants sue the insurance company, resulting in higher premiums for the policyholder down the road.

An AOB simplifies the insurance claims process for policyholders, letting service providers handle the work of getting paid for their services. This reduces responsibility and stress for policyholders and can often serve the best interests of all parties.

An AOB on a claim form is a line item where you authorize a service provider to receive insurance benefits for a specific claim. It lets that provider directly bill and get paid by the insurance company, simplifying the process for you. Make sure to understand the terms before signing it.[2] In some cases, it could mean you are responsible for any fees billed by your service provider if your insurance company doesn’t pay the full amount.

The Do’s & Don’ts of Submitting a Homeowners Insurance Claim
How Long Will My Homeowners Insurance Claim Take?
How to File a Homeowners Insurance Claim
How to Document Property Damage for Your Claim
How to Speed Up Your Homeowners Insurance Claim
Insurance Claims & Appeals

Post Disaster Claims Guide . National Association of Insurance Commissioners.

Assignment of Benefits . Department of Health and Human Services – North Dakota.

Understanding Dental Assignment of Benefits . West Virginia Offices of the Insurance Commissioner.

Assignment of Benefits: Consumer Beware . (April 2020). National Association of Insurance Commissioners.

What is an assignment of benefits?

Jim Probasco is an expert in the areas of personal income, saving and investing, banking, home buying, insurance, and more. A Dayton, Ohio-based writer, Jim has written for radio and television, and authored books for parents in arts education opportunities for their children.

The last time you sought medical care, you likely made an appointment with your provider, got the treatment you needed, paid your copay or deductible, and that was it. No paperwork, no waiting to be reimbursed; your doctor received payment from your insurance company and you both went on with your lives.

This is how most people receive health care in the U.S. This system, known as assignment of benefits or AOB, is now being used with other types of insurance, including auto and homeowners coverage .

What is an assignment of benefits?

An AOB is a legal agreement that allows your insurance company to directly pay a third party for services performed on your behalf. In the case of health care, it could be your doctor or another medical professional providing care. With a homeowners, renters, or auto insurance claim, the third party could be a contractor, auto repair shop, or other facility.

Assignment of benefits is legal, thanks to a concept known as freedom of contract, which says two parties may make a private agreement, including the forfeiture of certain rights, and the government may not interfere. There are exceptions, making freedom of contract something less than an absolute right. For example, the contract may not violate the law or contain unfair terms.

Not all doctors or contractors utilize AOBs. Therefore, it’s a good idea to make sure the doctor or service provider and you are on the same page when it comes to AOBs before treatment or work begins.

How an AOB works

The function of an AOB agreement varies depending on the type of insurance policy involved, the healthcare provider, contractor, or service provider, and increasingly, state law. Although an AOB is normal in health insurance, other applications of assignment of benefits have now included the auto and homeowners insurance industry.

Because AOBs are common in health care, you probably don’t think twice about signing a piece of paper that says “assignment of benefits” across the top. But once you sign it, you’re likely turning over your right to deal with your insurance company regarding service from that provider. Why would you do this?

According to Dr. David Berg of Redirect Health , the reason is simple: “Without an AOB in place, the patient themselves would be responsible for paying the cost of their service and would then file a claim with their insurance company for reimbursement.”

With homeowners or auto insurance, the same rules apply. Once you sign the AOB, you are effectively out of the picture. The contractor who reroofs your house or the mechanic who rebuilds your engine works with your insurance company by filing a claim on your behalf and receiving their money without your help or involvement.

“Each state has its own rules, regulations, and permissions regarding AOBs,” says Gregg Barrett, founder and CEO of WaterStreet , a cloud-based P&C insurance administration platform. “Some states require a strict written breakdown of work to be done, while others allow assignment of only parts of claims.”

Within the guidelines of the specific insurance rules for AOBs in your state, the general steps include:

You and your contractor draw up an AOB clause as part of the contract.
The contract stipulates the exact work that will be completed and all necessary details.
The contractor sends the completed AOB to the insurance company where an adjuster reviews, asks questions, and resolves any discrepancies.
The contractor’s name (or that of an agreed-upon party) is listed to go on the settlement check.

After work is complete and signed off, the insurer will issue the check and the claim will be considered settled.

The 10 best insurance companies for small businesses What is bond insurance, and how can it protect your business?

Example of an assignment of benefits

If you’re dealing with insurance, how would an AOB factor in? Let’s take an example. “Say you have a water leak in the house,” says Angel Conlin, chief insurance officer at Kin Insurance . “You call a home restoration company to stop the water flow, clean up the mess, and restore your home to its former glory. The restoration company may ask for an assignment of benefits so it can deal directly with the insurance company without your input.”

In this case, by eliminating the homeowner, whose interests are already represented by an experienced insurance adjustor, the AOB reduces redundancy, saves time and money, and allows the restoration process to proceed with much greater efficiency.

When would you need to use an assignment of benefits?

An AOB can simplify complicated and costly insurance transactions and allow you to turn these transactions over to trusted experts, thereby avoiding time-consuming negotiations.

An AOB also frees you from paying the entire bill upfront and seeking reimbursement from your insurance company after work has been completed or services rendered. Since you are not required to sign an assignment of benefits, failure to sign will result in you paying the entire medical bill and filing for reimbursement. The three most common uses of AOBs are with health insurance, car insurance, and homeowners insurance.

Assignment of benefits for health insurance

As discussed, AOBs in health insurance are commonplace. If you have health insurance, you’ve probably signed AOBs for years. Each provider (doctor) or practice requires a separate AOB. From your point of view, the big advantages of an AOB are that you receive medical care, your doctor and insurance company work out the details and, in the event of a disagreement, those two entities deal with each other.

Assignment of benefits for car owners

If your car is damaged in an accident and needs extensive repair, the benefits of an AOB can quickly add up. Not only will you have your automobile repaired with minimal upfront costs to you, inconvenience will be almost nonexistent. You drop your car off (or have it towed), wait to be called, told the repair is finished, and pick it up. Similar to a health care AOB, disagreements are worked out between the provider and insurer. You are usually not involved.

Assignment of benefits for homeowners

When your home or belongings are damaged or destroyed, your primary concern is to “return to normal.” You want to do this with the least amount of hassle. An AOB allows you to transfer your rights to a third party, usually a contractor, freeing you to deal with the crisis at hand.

When you sign an AOB, your contractor can begin immediately working on damage repair, shoring up against additional deterioration, and coordinating with various subcontractors without waiting for clearance or communication with you.

The fraud factor

No legal agreement, including an AOB, is free from the possibility of abuse or fraud. Built-in safeguards are essential to ensure the benefits you assign to a third party are as protected as possible.

In terms of what can and does go wrong, the answer is: plenty. According to the National Association of Mutual Insurance Companies (NAMICs), examples of AOB fraud include inflated invoices or charges for work that hasn’t been done. Another common tactic is to sue the insurance company, without the policyholder’s knowledge or consent, something that can ultimately result in the policyholder being stuck with the bill and higher insurance premiums due to losses experienced by the insurer.

State legislatures have tried to protect consumers from AOB fraud and some progress has been made. Florida, for example, passed legislation in 2019 that gives consumers the right to rescind a fraudulent contract and requires that AOB contracts include an itemized description of the work to be done. Other states, including North Dakota, Kansas, and Iowa have all signed NAMIC-backed legislation into law to protect consumers from AOB fraud.

The National Association of Insurance Commissioners (NAIC), offers advice for consumers to help avoid AOB fraud and abuse:

File a claim with your insurer before you hire a contractor. This ensures you know what repairs need to be made.
Don’t pay in full upfront. Legitimate contractors do not require it.
Get three estimates before selecting a contractor.
Get a full written contract and read it carefully before signing.
Don’t be pressured into signing an AOB. You are not required to sign an AOB.

Pros and cons of an assignment of benefits

The advantages and disadvantages of an AOB agreement depend largely on the amount and type of protection your state’s insurance laws provide.

An AOB frees you from paying for services and waiting for reimbursement from your insurer
Some people appreciate not needing to negotiate with their insurer
You are not required to sign an AOB.
Signing an AOB could make you the victim of a scam without knowing it until your insurer refuses to pay
An AOB doesn’t free you from the ultimate responsibility to pay for services rendered, which could drag you into expensive litigation if things go south
Any AOB you do sign is legally binding

The takeaway

An AOB, as the health insurance example shows, can simplify complicated and costly insurance transactions and help consumers avoid time-consuming negotiations. And it can save upfront costs while letting experts work out the details.

It can also introduce a nightmare scenario laced with fraud requiring years of costly litigation. Universal state-level legislation with safeguards is required to avoid the latter. Until that is in place, your best bet is to work closely with your insurer when signing an AOB. Look for suspicious or inflated charges when negotiating with contractors, providers, and other servicers.

Our ranking of the best jewelry insurance can help you insure your personal treasures.
Entrepreneurs need to check out this list of the best small business insurance companies .
Check out the best personal loans to help fund your next big purchase.
Small business owners should check out this ranking of the best business checking accounts .

Follow Fortune Recommends on Facebook and Twitter .

About the contributors

EDITORIAL DISCLOSURE : The advice, opinions, or rankings contained in this article are solely those of the Fortune Recommends ™ editorial team. This content has not been reviewed or endorsed by any of our affiliate partners or other third parties.

Assignment of Benefits vs Direction to Pay vs Assignment of Policy

Assignment of Benefits vs. Assignment of Policy

Assignment of Benefits forms, also known as AOBs, play a crucial role in the restoration industry’s contractor-client dynamics. These legal documents empower policyholders to transfer their insurance policy benefits to a third party, effectively connecting their restoration contractor directly to their insurance company. By doing so, policyholders can bypass many of the complications and anxieties typically associated with a restoration project, streamlining the process.

According to Josh Ehmke, Co-owner and General Consult at One Claim Solution , there’s a common misunderstanding between assignment of benefits and assignment of policy. An assignment of policy refers to the transfer of the benefits and rights of an insurance policy from one party (the policyholder) to another party (the assignee).

“An assignment of policy is never going to be valid. In fact, I haven’t come across a state that allows an assignment of an insurance policy without the insurance company’s prior written consent,” Josh said. “The reason it’s not allowed is because it’s against public policy. It increases the insurance risk substantially.”

For example, a policyholder might have a history of filing numerous claims against their insurance provider, suggesting a pattern that they might be well-versed in exploiting certain loopholes and taking advantage of insurance companies. Additionally, there are concerns that they may not adequately maintain or safeguard their property, leading to an increased risk for the insurance company.

“That is absolutely different from an assignment of benefits, which grants the rights the policyholder had to the payment under the policy to be transferred to the assignee,” Josh said. ”The only prerequisite for an assignment of benefits other than having a covered claim, is that the loss has already occurred. If you get an assignment of benefits before the loss occurs, that’s essentially a transfer of a policy.”

OCS recently encountered a case where the question arose regarding the scope of an assignment of benefits. Specifically, the issue was whether only the rights of the policyholder are transferred, or if the policyholder’s obligations are also transferred alongside the benefits under the assignment.

“By taking the assignment, the contractor doesn’t assume the policyholder’s obligations under that policy,” Josh said. “It’s very important to word your assignment of benefits appropriately to clearly state that you’re not agreeing to assume any of those policy obligations, and to specify which rights you want.”

Direction to Pay vs. Assignment of Benefits

Direction to pay (DTP) is a financial arrangement where the policyholder, who is entitled to receive an insurance claim payment, instructs the insurance company to pay the claim proceeds directly to a third party. This third party could be a vendor, contractor, service provider, or any other entity to whom the policyholder owes a debt or has entered into an agreement.

“The issue with direction to pay is that the carrier doesn’t have to honor it because it’s not enforceable,” Josh said. “It’s very limited in what it can do, whereas an assignment of benefits is much more powerful because it obligates the insurance company legally to pay you.”

According to Josh, DTP’s are rarely used, except in states like Texas and Florida where AOBs are detrimental to contractors or illegal.

“A DTP is better than nothing and allows you to at least show the carrier that the homeowner granted approval to request payment,” Josh said. “But outside of those situations, the direction to pay in my mind is worthless. When you can have an assignment of benefits, there’s no reason to have a direction to pay at all.”

A Final Word

Understanding the differences between an AOB, Assignment of Policy, and DTP is crucial because each term represents distinct legal and financial arrangements that can significantly impact insurance claims and policyholder rights. To learn more about the value of assignment of benefits in helping you navigate the restoration process, be sure to subscribe to our newsletter .

(602) 491-2588

[email protected]

335 E Germann Rd #340 Gilbert, AZ 85297

WHO WE SERVE

Partner With Us

PRIVACY POLICY

Connor Trahan

Account executive.

Hi there! I’m Connor, the Account Executive for One Claim. My goal is to guide our contractors through the sales process, ensuring you’re equipped with all the information you need to make your decision and hit the ground running once aboard. We view ourselves as an extension of your business and I strive to make the process an enlightening and consultative one. My career has primarily been focused in software sales over a few different industries but the last few years were spent helping general contractors solve similar problems to what we’re doing here at OCS! Outside of work, I love spending time with my family, cooking and boating during the summer months.

Nicole Liesenfelt

Director, human resources.

Hello! I’m Nicole, and I’m here to champion for our employees, recruit for new talent, and impact culture at One Claim Solution. I find satisfaction in supporting a memorable employee experience and bring innovation, problem solving, and strategic view to the process. Nothing is more important than our people, and a healthy culture is my top priority! I have had the pleasure of building my career in various sectors, specializing in small to medium size firms focused on high-growth. My experience is centered around driving and implementing change, leading high-performing teams, and driving process improvements. I am excited to make an impact at One Claim. Outside of work, my family and I enjoy getting outdoors as much as possible to explore beautiful Colorado!

Elizabeth McGlone

Demand generation manager.

Great to meet you! I’m Elizabeth, and I’m the one behind all the emails and advertisements you’ve been seeing. As the Demand Generation Manager at One Claim Solution, my mission is to connect with contractors like you who need our services. I’m passionate about having an impact on others and I bring a wealth of experience in demand generation and marketing strategy to create moments of delight, curiosity, and education for you.

Prior to One Claim Solution, I had the privilege of building marketing departments from the ground up at companies in a variety of industries, including IT consulting, first protection, and healthcare. Personally, I love being outdoors, playing Dungeons and Dragons and board games, singing, and traveling.

Alisha Yartzoff

Director of contractor success.

Welcome! I’m Alisha, and I’m here to champion your success as the Director of Contractor Success at One Claim. With a passion for helping contractors thrive, I bring a wealth of experience in onboarding, customer service, and account management to ensure your journey with us is nothing short of exceptional.

Prior to joining One Claim, I had the privilege of scaling SMB and Enterprise Customer Success teams at fast-growing SaaS startups. With over six years of experience at companies like Mavenlink, Teamwork, and ServiceTitan, I honed my expertise in building high-performing teams and fostering proactive, consultative relationships. This background has equipped me with a deep understanding of the challenges faced by businesses like yours, and I’m dedicated to helping you overcome them.

Hi there, my name is Eric! I am the Chief Technology Officer here at OCS, spearheading our technical strategy. I have a background in computer science, graduating cum laude from BYU-Idaho with a Bachelor’s degree in Computer Information Technology.

Before coming to One Claim, I served as the Director of Engineering at Slingshot Technology, Inc., a company later acquired by WorkWave in 2021. My professional journey has spanned both emerging startups and established corporations, with a steadfast focus on cultivating high-trust, low bureaucracy teams and innovating technology using agile methodologies.

In my free time, you can find me flying drones, enjoying the outdoors, and spending time with my family.

Hello, my name is Cam, I’m the COO of One Claim Solution! I come from a management consulting background (Bain & Company) and hold an MBA from the University of Michigan. I have worked at a wide variety of organizations, from Fortune 500 to small-cap, in an equally wide variety of industries. I have over 15 years of experience in operations and strategic growth, and I have spent much of my career focused on developing high-performing tech-enabled service organizations through early stage and high growth phases.

Outside of work, my wife Brittny and I have four kids, ages 13 to 6. As residents of Mesa, Arizona, we love to ski and explore the national parks of the southwest!

Hello, my name is Dan, and I am the CEO of One Claim Solution. I am super excited by everything we are doing at OCS to be the market leading insurance billing specialist that advocates on behalf of our restoration contractors.

My professional experiences are predominantly corporate in nature. My career started at General Electric in finance and accounting. Immediately prior to joining OCS, I spent time as an investor at Bondcliff Partners and management consultant with Bain & Company. I also hold an MBA from the Kellogg School of Management at Northwestern University and got my BS in finance and accounting from Northeastern University.

Outside of the office, I enjoy spending time with my wife, two young children, and our family dog, Whiskey. We live in Charleston, SC and take advantage of the beautiful weather by spending as much time as possible outside at the beach or adventuring around town

Co-Founder and General Counsel

Hi, I’m Josh! In 2016, I co-founded One Claim Solution with my partner Jeremy Traasdahl, and I serve as General Counsel of One Claim Solution. Working in the restoration industry, Jeremy and I saw contractors struggling to get paid quickly and fairly and we knew there was a need for change. We founded One Claim Solution to be this change and it’s been my privilege to see our company grow and to advocate for our clients as general counsel.

Outside of my passion for helping the restoration industry, I enjoy spending time outdoors, fly-fishing, hunting, skiing, and coaching my kids’ baseball teams. I’ve been married to my amazing wife for 20 years and we have a beautiful family of 5 children.

Jeremy Traasdahl

Hey, I’m Jeremy! In 2016, I co-founded One Claim Solution with my partner Josh Ehmke. Working in the restoration industry, Josh and I saw contractors struggling to get paid quickly and fairly and we knew there was a need for change. We founded One Claim Solution to be this change and it’s been my privilege to lead our amazing team.

Prior to One Claim Solution, I started my career as an inside sales rep for Avnet, then moved to Pepsico as a district sales manager. Outside of work, I love spending time with my wife and four children, two boys and two girls!

Assignment Of Benefits

What does assignment of benefits mean.

Assignment of benefits (AOB) is the official way an insured person asks their insurance company to pay a professional or facility for services rendered.

Insuranceopedia Explains Assignment Of Benefits

Assignment of benefits is a document that directs payment to a third party at the insured’s request. It becomes legitimate once both the insured party and their insurer have signed the AOB form. AOB is used in a number of insurance contexts, such as paying physicians or clinics through health insurance or paying contractors for repairs through a homeowner’s insurance policy.

Usually, AOBs are issued when the third party pursues it in the hopes that payment from the insurance company will be more certain and delivered more quickly than it would be from the insured.

Related Definitions

Rental value insurance, change of occupation provision, force-placed insurance, guaranteed asset protection insurance, insurance to value, loss report, no benefit to bailee provision, guaranteed renewable contract, related terms, certificate of coverage, third party, medical payments insurance, related articles, how to lower your health insurance rates, 10 tips for choosing the right health insurance policy, 10 things you need to know about health insurance in the united states, the ultimate guide to auto insurance, the future of insurtech: how technology is transforming the insurance industry, inside the details of auto transport insurance: an expert interview, trending articles.

What is an Assignment of Benefits?

Small and Medium Business Solutions

This is how most people receive health care in the U.S. This system, known as assignment of benefits or AOB, is now being used with other types of insurance, including auto and homeowners coverage .

What is an assignment of benefits?

How an AOB works

According to Dr. David Berg of Redirect Health, the reason is simple: “Without an AOB in place, the patient themselves would be responsible for paying the cost of their service and would then file a claim with their insurance company for reimbursement.”

Within the guidelines of the specific insurance rules for AOBs in your state, the general steps include:

You and your contractor draw up an AOB clause as part of the contract.
The contract stipulates the exact work that will be completed and all necessary details.
The contractor sends the completed AOB to the insurance company where an adjuster reviews, asks questions, and resolves any discrepancies.
The contractor’s name (or that of an agreed-upon party) is listed to go on the settlement check.

After work is complete and signed off, the insurer will issue the check and the claim will be considered settled.

Example of an assignment of benefits

When would you need to use an assignment of benefits?

An AOB can simplify complicated and costly insurance transactions and allow you to turn these transactions over to trusted experts, thereby avoiding time-consuming negotiations.

Assignment of benefits for health insurance

Assignment of benefits for car owners

Assignment of benefits for homeowners

The fraud factor

The National Association of Insurance Commissioners (NAIC), offers advice for consumers to help avoid AOB fraud and abuse:

File a claim with your insurer before you hire a contractor. This ensures you know what repairs need to be made.
Don’t pay in full upfront. Legitimate contractors do not require it.
Get three estimates before selecting a contractor.
Get a full written contract and read it carefully before signing.
Don’t be pressured into signing an AOB. You are not required to sign an AOB.

Pros and cons of an assignment of benefits

The advantages and disadvantages of an AOB agreement depend largely on the amount and type of protection your state’s insurance laws provide.

Pros of assignment of benefits

With proper safeguards in place to reduce opportunities for fraud, AOBs have the ability to streamline and simplify the insurance claims process.

An AOB frees you from paying for services and waiting for reimbursement from your insurer.
Some people appreciate not needing to negotiate with their insurer.
You are not required to sign an AOB.

Cons of assignment of benefits

As with most contracts, AOBs are a double-edged sword. Be aware of potential traps and ask questions if you are unsure.

Signing an AOB could make you the victim of a scam without knowing it until your insurer refuses to pay.
An AOB doesn’t free you from the ultimate responsibility to pay for services rendered, which could drag you into expensive litigation if things go south.
Any AOB you do sign is legally binding.

The takeaway

By: Jim Probasco

From: Fortune Recommends

Assignment of benefits

Assignment of benefits is a legal agreement where a patient authorizes their healthcare provider to receive direct payment from the insurance company for services rendered.

Boost patient experience and your bottom line by automating patient cost estimates, payer underpayment detection, and contract optimization in one place.

What is Assignment of Benefits?

Assignment of benefits (AOB) is a crucial concept in the healthcare revenue cycle management (RCM) process. It refers to the legal transfer of the patient's rights to receive insurance benefits directly to the healthcare provider. In simpler terms, it allows healthcare providers to receive payment directly from the insurance company, rather than the patient being responsible for paying the provider and then seeking reimbursement from their insurance company.

Understanding Assignment of Benefits

When a patient seeks medical services, they typically have health insurance coverage that helps them pay for the cost of their healthcare. In most cases, the patient is responsible for paying a portion of the bill, known as the copayment or deductible, while the insurance company covers the remaining amount. However, in situations where the patient has assigned their benefits to the healthcare provider, the provider can directly bill the insurance company for the services rendered.

The assignment of benefits is a legal agreement between the patient and the healthcare provider. By signing this agreement, the patient authorizes the healthcare provider to receive payment directly from the insurance company on their behalf. This ensures that the provider receives timely payment for the services provided, reducing the financial burden on the patient.

Difference between Assignment of Benefits and Power of Attorney

While the assignment of benefits may seem similar to a power of attorney (POA) in some respects, they are distinct legal concepts. A power of attorney grants someone the authority to make decisions and act on behalf of another person, including financial matters. On the other hand, an assignment of benefits only transfers the right to receive insurance benefits directly to the healthcare provider.

In healthcare, a power of attorney is typically used in situations where a patient is unable to make decisions about their medical care. It allows a designated individual, known as the healthcare proxy, to make decisions on behalf of the patient. In contrast, an assignment of benefits is used to streamline the payment process between the healthcare provider and the insurance company.

Examples of Assignment of Benefits

To better understand how assignment of benefits works, let's consider a few examples:

Sarah visits her primary care physician for a routine check-up. She has health insurance coverage through her employer. Before the appointment, Sarah signs an assignment of benefits form, authorizing her physician to receive payment directly from her insurance company. After the visit, the physician submits the claim to the insurance company, and they reimburse the physician directly for the covered services.

John undergoes a surgical procedure at a hospital. He has health insurance coverage through a private insurer. Prior to the surgery, John signs an assignment of benefits form, allowing the hospital to receive payment directly from his insurance company. The hospital submits the claim to the insurance company, and they reimburse the hospital for the covered services. John is responsible for paying any copayments or deductibles directly to the hospital.

Mary visits a specialist for a specific medical condition. She has health insurance coverage through a government program. Mary signs an assignment of benefits form, granting the specialist the right to receive payment directly from the government program. The specialist submits the claim to the program, and they reimburse the specialist for the covered services. Mary is responsible for any applicable copayments or deductibles.

In each of these examples, the assignment of benefits allows the healthcare provider to receive payment directly from the insurance company, simplifying the billing and reimbursement process for both the provider and the patient.

Assignment of benefits is a fundamental concept in healthcare revenue cycle management. It enables healthcare providers to receive payment directly from the insurance company, reducing the financial burden on patients and streamlining the billing process. By understanding the assignment of benefits, patients can make informed decisions about their healthcare and ensure that their providers receive timely payment for the services rendered.

Get paid in full by bringing clarity to your revenue cycle

Related terms, quality reporting program.

Quality reporting program is a structured initiative that measures and assesses healthcare providers' performance based on predetermined quality measures.

False Claims Act

False Claims Act is a federal law that imposes liability on individuals or entities who knowingly submit false or fraudulent claims for payment to the government.

Subscribe to the

Healthcare Clarified newsletter

Get the latest insights on RCM and healthcare policy in your inbox

Practice Areas
Terminology
Entrepreneurship
Medical Billing
Healthcare Conferences

What is Assignment of Benefits in Medical Billing?

doctor sitting at his desk on his laptop

An assignment of benefits is the act of signing documentation authorizing a health insurance company to pay a physician directly. In other words, the insurance company can pay claims without the direct involvement of the patient in the process. There are other situations where AOBs can be helpful, but we’ll focus on their use in relation to medical benefits.

If there isn’t an assignment of benefits agreement in place, the patient would be responsible for paying the other party directly from their own pocket, then filing a claim with their insurance provider to receive reimbursement. This could be time-consuming and costly, especially if the patient has no idea how to file a claim.

The document is typically signed by patients when they undergo medical procedures. The purpose of this form is to assign the responsibility of payment for any future medical bills that may arise after the procedure. It’s important to note that not all procedures require an AOB.

An assignment of benefits agreement might be utilized to pay a medical practitioner the patient didn’t choose, like an anesthesiologist. The patient may have picked a surgeon, but an anesthesiologist assigned on the day of the procedure might issue a separate bill. They’re, in essence, signing that anyone involved in their treatment can receive direct payment from the insurance carrier. It doesn’t have to go through the patient.

This document can also eliminate service fees surrounding processing. As a result, the patient can focus on medical treatment and recovery without being bogged down with the complexities of paying medical bills. The overall intent of an assignment of benefits agreement is to make the process more manageable for the patient, as they don’t need to haggle directly with their insurer.

List of Providers and Services

When the patient signs an AOB agreement, they give a third party right to obtain payment for services the provider performed, and medical billing services are a prime example of where they may sign an AOB agreement.

Ambulance services
Medical insurance claims
Drugs and pharmaceuticals
Diagnostic and clinical lab services
Emergency surgical center services
Dialysis supplies and equipment used in the home
Physician services for Medicare and Medicaid patients

Services of professionals other than a primary care physician, which includes:

Physician assistants
Clinical nurse specialists
Clinical social workers
Clinical psychologists
Certified registered nurse anesthetists

doctor at desk filling out forms on clipboard

Information Commonly Requested on Assignment of Benefits Form:

Signature of patient or person legally responsible
Signature of parent or legal guardian

How AOBs Affect the Medical Practitioner

A medical provider or their administrative staff may feel overwhelmed by the sheer number of forms patients must fill out prior to treatment. Demanding more paperwork from patients may be seen as an added burden on the managerial staff, as well as the patient. However, getting a signed AOB is vital in preserving the interests of everyone involved.

In addition to receiving direct payment from the insurance company without needing to go through the patient, a signed assignment of benefits form will help medical providers appeal denied and underpaid claims. They can ask that payments be made directly to them rather than through the patient. This makes the process more manageable for both the doctors and the patient.

Things to Bear in Mind

The patient gives their rights and benefits to third parties under their current health plan. Depending on the wording in the AOB, their insurer may not be allowed to contact them directly about their claims. In addition, the patient may be unable to negotiate settlements or approve payments on their behalf and enable third parties to endorse checks on behalf of the patient. Finally, when the patient signs an AOB, the insurer may sue the third parties involved in the dispute.

Looking for a qualified medical billing service?

By taking just 1 minute to provide some basic information about your practice, you can get up to 5 pre-screened companies competing for your business.

What Is Cosmetic Dermatology? Your Guide to Treatments, Costs, and More

What is a clia number in medical billing, healthcare revenue cycle management explained, leave a reply.

Your email address will not be published. Required fields are marked *

Save my name, email, and website in this browser for the next time I comment.

+1 978-683-5115
+1 978-423-1269
[email protected]

What Is Assignment Of Benefits In Medical Billing – AOB Complete Guide

The healthcare industry operates with a diverse network of payers and various reimbursement means. From government to private insurance companies, a healthcare practice is simultaneously engaged with multiple payer parties, each linked to a different patient with unique regulations and requirements. This reimbursement workflow and many other factors alone make this already hectic environment business a bit more chaotic if not dealt with properly. With the development and execution of several policies, every healthcare service strives to bring more efficiency and seamlessness to its operations, and the reimbursement system is not an exception in this regard. This is where the assignment of benefits in medical billing comes into play.

What is Assignment of Benefits in Medical Billing?

An assignment of benefits in medical billing is a type of agreement between the healthcare provider, insurance company, and the patient through which a patient authorizes the medical service to collect healthcare policy coverage benefits on their behalf from their insurer for the service they have received from the facility. Once the patient signs this agreement, a direct payment link is made between the facility and the insurance company without communicating every time with the patient, which brings seamlessness and efficiency to the reimbursement process.

Read More: Medical Billing vs Revenue Cycle Management – Key Differences Explained

Medical Services That Use the Assignment of Benefits

Various healthcare providers across different specialties and settings may use Assignment of Benefits (AOB) as part of their billing practices. Some examples of healthcare providers that commonly use AOB include:

Physicians and Medical Practices
Hospitals and Medical Centers
Dentists and Dental Clinics
Physical Therapy and Rehabilitation Centers
Ambulatory Surgery Centers
Imaging Centers

So how does this assignment of benefits in medical billing work? Let’s explore:

What is the Procedure for the Assignment of Benefits in Medical Billing ? – the Methodology

Patient visit.

In the first step, the patient receives medical service from a healthcare facility like a hospital, clinic, etc.

AOB Agreement

Once the services are rendered, the healthcare facility presents an AOB agreement to the patient to transfer their healthcare insurance coverage benefits to the facility directly. The patient is advised to thoroughly review the form before signing for consent as they are establishing a direct form of communication and payment action by authorizing the medical service to collect monetary benefits on their behalf.

Claim Submission

In this stage, the healthcare service document and code all the service encounters with the patient into medical bills and claim, comprising all the details and treatment procedures that are associated with curing the patient. These claims are then sent to the insurance company.

Claim Reviewing

After claim submission, the insurance company meticulously evaluates it on the criteria of its unique requirements, standard policies, and regulations. They also analyze the accuracy of the claim and assess the coverage limit against the payment listed in the claim. If the claim is found to be inaccurate or ineligible for coverage by the insurance company, it reverts back to the facility for denial management.

In the case the claim is approved, the insurance company makes payment directly to the medical service given the AOB policy. This reimbursed amount may cover the full or half of the patient’s medical bills, based on the coverage plan.

Patient Responsibility

Once the insurer pays the billed amount to the medical service, any remaining payment responsibilities come on the shoulder of the patient, like deductibles, co-pays, or services not covered by insurance. The patient may receive an explanation of benefits (EOB) from the insurance company, outlining the details of the claim and any patient responsibility.

Read More: Why Outsourcing Ophthalmology Medical Billing is the Smart

What are the Complications in the Assignment of Benefits in Medical Billing? – the Hindrances

Assignment of benefits does not work well necessarily for all patient encounters. There are some instances where it fails to be applicable or may get denied. So what are those cases? Let’s explore:

Out-of-Network Providers

An insurance policy can deny the assignment of benefits claim if the service acquired by the patient is out of its network of carriers. In this case, the healthcare facility can’t establish any type of reimbursement connection with the insurance policy and must obtain the payments directly from the patient. The patient can then cover their expenditure from their insurance policy.

Non-Covered Services

It is not necessary that a health insurance policy cover all types of patient medical encounters. Every policy has its own limitations and offers reimbursements for medical services according to its regulations. So if a patient seeks a medical facility that is not covered by their healthcare policy, no AOB agreement will be applicable here. In this scenario, a patient is required to pay all the charges from their own pocket.

Preauthorization Requirements

Insurance policies require preauthorization for certain medical treatments, procedures, or medications, and if a patient fails to obtain this preauthorization, the insurance company rejects the assignment of benefits claim, leaving the patient to pay the bills out of their pocket.

Claims Rejection

Even with an AOB in place, insurance companies may reject or deny claims for various reasons, such as incomplete documentation, coding errors, or policy exclusions. In such cases, the provider and the patient may need to work together to resolve the issue and resubmit the claim.

If an AOB gets accepted, it will only cover the services eligible for insurance coverage. Patients are still responsible for any deductibles, co-pays, or non-covered services as per their insurance policy. If the patient fails to pay their portion, it can lead to complications in the billing process.

Billing Disputes

Moreover, billing disputes between healthcare providers and insurance companies are another reason for AOB complications. Occasionally, disputes may arise between the healthcare provider and the insurance company regarding reimbursement rates or claim processing. These disputes can delay or hinder the AOB process, requiring additional efforts to resolve the billing issues. Read More: What Is Down Coding In Medical Billing? – The Complete Guide

Assignment of benefits is an excellent way to increase the efficiency of the reimbursement process in the medical industry. However, for a patient, it is important to thoroughly and meticulously review all the terms and complications associated with the agreement of AOB as it transfers their monetary rights directly to the healthcare service.

Concerning healthcare services, they must ensure a well-communicated, clear, and detailed preparation of this agreement to help patients better understand all the things related to their financial obligations and insurance benefits transfer. Further, the medical facilities should also bring more accuracy and compliance with standards to their billing and overall financial landscape to make the whole process conducive to the acceptance of AOB, effectively navigating the complex web of reimbursements.

Stay in Touch

After hours & weekend physician line

978-423-1269
978-683-5115
PRIVACY POLICY
TERMS AND CONDITIONS

Caring ‣ Urgent ‣ Aggressive

Call For A Free Legal Consultation: (201) 261-1700
Physician Reimbursement
PIP / No-Fault Arbitration
Workers’ Compensation Recovery
Hospital Reimbursement
ERISA Litigation Claim Attorneys
Healthcare Arbitration
Bicycle Accident
Brain Injury
Bus Accident
Car Accident
Construction Accident
Hit and Run
Motorcycle Accident
Negligent Supervision
Nursing Home Negligence
Pedestrian Accident
Slip and Fall
Truck Accident
Train Accident
Wrongful Death
Workers Compensation
Business Disputes
Business Justice Attorneys
Employment Counseling and Litigation
Shareholder/Partner Issues
Shareholder Derivative Actions
Business Dissolutions
Business Transactions
Buying/Selling a Business
Corporate Entity Formation
Director and Officers Duties
Executive Compensation
Negotiating Vendor Agreements
Regulatory and Statutory Compliance
Age Discrimination
Disability Discrimination
Gender Identity Discrimination
Race Discrimination
Religious Discrimination
Sex Discrimination
Appellate Law
Child Custody
Child Custody College Expenses
Child Support
Divorce for Business Owners
Divorce Mediation
Domestic Violence
Prenuptial Agreements
Property Distribution
Understanding The Divorce Process
Auto Insurance/Property Damage
All-risks Property Insurance
Commercial General Liability (CGL) Insurance
Disability Insurance
Health Insurance
Insurance Agent/Broker Negligence
Life Insurance
Long-term Care Insurance
Marine/Boat Insurance
Wind & Flood Property Insurance
Commercial Purchase
Commercial Sales
Commercial Lease Agreement
First-Time Home Buyer
Lease Agreements
Real Estate Closing
Refinancing
Residential Purchases
Residential Sales
Title Review
Estate Planning
Estate Planning for Business Owners
Healthcare Directives
Powers of Attorney
Trust Drafting
Will Contest
Will Drafting
Sean Callagy Esq
The Callagy Law Team
Testimonials
Join Our Team
Message of Empathy
Business Law
Commercial Litigation
News & Events
Medical Revenue Recovery
Personal Injury
Free Legal Guides
Paramus, NJ Office
New York, NY Office
Phoenix, AZ Office
East Hanover, NJ Office

Call For A Free Legal Consultation

(201) 261 - 1700

Insurance claims , medical revenue recovery, what should an assignment of benefits form include.

An assignment of benefits form (AOB) is a crucial document in the healthcare world. It is an agreement by which a patient transfers the rights or benefits under their insurance policy to a third-party – in this case, the medical professional who provides services. This way, the medical provider can file a claim and collect insurance payments. In the context of personal injury protection coverage, an AOB is a critical step in the reimbursement process.

Personal injury protection coverage , or PIP, is designed to cover medical expenses and lost wages incurred after an auto accident, regardless of who is at fault. In New Jersey, drivers are required to carry PIP. Now, let’s say there’s an accident: the driver sees a medical provider for treatment, and the provider bills the patient’s carrier. There is nothing that requires that the insurance carrier to pay the provider.

This is why an assignment of benefits form is so important. It essentially removes the patient from the equation and puts the medical provider in their place as far as the insurance policy is concerned. This enables the provider to be paid directly. If you see PIP patients and want to be paid directly by the insurer (and avoid claim denials or complex legal situations later) you must get an AOB.

The AOB authorization creates a legal relationship between the provider and the insurance carrier. What should it include?

Correct Business Entity

Fill out your business name correctly: it seems simple, but this can be a stumbling block to reimbursement. If your business name is Dr. Smith’s Chiropractic Care Center, you cannot substitute Dr. Smith’s, Smith’s Chiropractic, etc. It must be Dr. Smith’s Chiropractic Care Center. If you have a FEIN number, use the name that is listed on your Health Care Financing Administration (HCFA) form.

“Irrevocable”

It is important that you include this term to indicate that the patient cannot later revoke the assignment of benefits. This tells the court that the AOB is the only document determining standing , or the ability to bring a lawsuit on related matters.

Another key term: the court sees benefits as payments. It does not necessarily give you the right to bring a lawsuit. Include language such as, “assigns the rights and benefits, including the right to bring suit…”

Benefit of Not Being Billed At This Time for Services

Essentially, this means that a provider gives up the right to collect payments at the time of service in exchange for the right to bring suit against the insurance company if they are not paid in full. Likewise, the patient gives up the right to bring suit, but they do not have to pay now. The wording will look like this: “In exchange for patient assigning the rights and benefits under their PIP insurance, Dr. Smith’s Chiropractic Care Center will allow patients to receive services without collecting payments at this time.”

Patient Signature

Yes, it’s basic, but make sure the assignment of benefits form is signed and dated by the patient! This renders the AOB , for all intents and purposes, null and void. It is not an executed contract. You would have to start the entire process again, which means waiting longer to be reimbursed for the claim.

Power of Attorney Clause

Including a power of attorney clause, which supports not only “the right of collecting payment” but also the provider’s ability to take legal action on behalf of the patients, is vital. At Callagy Law, we always argue this is inherent within the no-fault statute; however, there are carriers to argue against the right to arbitration when the language is not in the AOB.

As medical providers, it is critical that you receive proper – and timely – reimbursement for services rendered. The assignment of benefits form is one of the most important pieces in this puzzle. It is essential for an attorney to prepare, or at least review, your AOB and other admission paperwork to ensure that you are able to collect pursuant to your patients’ insurance benefits in whatever ways needed.

Callagy Law can not only review these documents, but also ensure you are pursuing all recoverable bills to which you are eligible. If you have any questions, would like us to review your AOB form, or have issues collecting payment from insurance companies, please contact the Callagy Law team today .

Your email address will not be published. Required fields are marked *

Wind & Flood Property Insurance
FREE LEGAL GUIDES

Today's news
Reviews and deals
Climate change
2024 election
Fall allergies
Health news
Mental health
Sexual health
Family health
So mini ways
Unapologetically
Buying guides

Entertainment

How to Watch
My Portfolio
Latest News
Stock Market
Biden Economy
Stocks: Most Actives
Stocks: Gainers
Stocks: Losers
Trending Tickers
World Indices
US Treasury Bonds Rates
Top Mutual Funds
Options: Highest Open Interest
Options: Highest Implied Volatility
Basic Materials
Communication Services
Consumer Cyclical
Consumer Defensive
Financial Services
Industrials
Real Estate
Stock Comparison
Advanced Chart
Currency Converter
Credit Cards
Balance Transfer Cards
Cash-back Cards
Rewards Cards
Travel Cards
Credit Card Offers
Best Free Checking
Student Loans
Personal Loans
Car insurance
Mortgage Refinancing
Mortgage Calculator
Morning Brief
Market Domination
Market Domination Overtime
Asking for a Trend
Opening Bid
Stocks in Translation
Lead This Way
Good Buy or Goodbye?
Financial Freestyle
Capitol Gains
Fantasy football
Pro Pick 'Em
College Pick 'Em
Fantasy baseball
Fantasy hockey
Fantasy basketball
Download the app
Daily fantasy
Scores and schedules
GameChannel
World Baseball Classic
Premier League
CONCACAF League
Champions League
Motorsports
Horse racing
Newsletters

New on Yahoo

Privacy Dashboard

Yahoo Finance

What is an assignment of benefits.

This is how most people receive health care in the U.S. This system, known as assignment of benefits or AOB, is now being used with other types of insurance, including auto and homeowners coverage .

How an AOB works

Because AOBs are common in health care, you probably don’t think twice about signing a piece of paper that says "assignment of benefits" across the top. But once you sign it, you’re likely turning over your right to deal with your insurance company regarding service from that provider. Why would you do this?

According to Dr. David Berg of Redirect Health, the reason is simple: “Without an AOB in place, the patient themselves would be responsible for paying the cost of their service and would then file a claim with their insurance company for reimbursement.”

Within the guidelines of the specific insurance rules for AOBs in your state, the general steps include:

You and your contractor draw up an AOB clause as part of the contract.

The contract stipulates the exact work that will be completed and all necessary details.

The contractor sends the completed AOB to the insurance company where an adjuster reviews, asks questions, and resolves any discrepancies.

The contractor’s name (or that of an agreed-upon party) is listed to go on the settlement check.

After work is complete and signed off, the insurer will issue the check and the claim will be considered settled.

Example of an assignment of benefits

When would you need to use an assignment of benefits?

An AOB can simplify complicated and costly insurance transactions and allow you to turn these transactions over to trusted experts, thereby avoiding time-consuming negotiations.

Assignment of benefits for health insurance

Assignment of benefits for car owners

Assignment of benefits for homeowners

The fraud factor

The National Association of Insurance Commissioners (NAIC), offers advice for consumers to help avoid AOB fraud and abuse:

File a claim with your insurer before you hire a contractor. This ensures you know what repairs need to be made.

Don’t pay in full upfront. Legitimate contractors do not require it.

Get three estimates before selecting a contractor.

Get a full written contract and read it carefully before signing.

Don’t be pressured into signing an AOB. You are not required to sign an AOB.

Pros and cons of an assignment of benefits

The advantages and disadvantages of an AOB agreement depend largely on the amount and type of protection your state’s insurance laws provide.

Pros of assignment of benefits

With proper safeguards in place to reduce opportunities for fraud, AOBs have the ability to streamline and simplify the insurance claims process.

An AOB frees you from paying for services and waiting for reimbursement from your insurer.

Some people appreciate not needing to negotiate with their insurer.

You are not required to sign an AOB.

Cons of assignment of benefits

As with most contracts, AOBs are a double-edged sword. Be aware of potential traps and ask questions if you are unsure.

Signing an AOB could make you the victim of a scam without knowing it until your insurer refuses to pay.

An AOB doesn’t free you from the ultimate responsibility to pay for services rendered, which could drag you into expensive litigation if things go south.

Any AOB you do sign is legally binding.

The takeaway

This story was originally featured on Fortune.com

Assignment of benefits: A growing concern

By Kevin Poll

Evaluating claims properly and determining the appropriate amount of a loss are crucial for insurance companies, especially when trying to offer competitive premiums to customers and maintain profitable financial results.

Factors that affect profitability

In the business of insurance, many factors—some that can’t be controlled—affect financial profitability. Predictive analytics and more refined modeling are helping insurers reduce uncertainty, but even the best of models have their limitations.

Further, many variables can’t be predicted but could have significant financial impact on the bottom line. One of those variables—the potential for the benefits of an insurance policy being assigned post-loss to predatory adjusters—has been a hot topic, particularly in those states where laws and regulations currently prevent insurance companies from being able to mitigate the problem.

What is assignment of benefits?

Typically, an insurance policy has a loss payment provision that advises the policyholder that any payment for a first-party loss will be paid directly to the insured unless another party is legally entitled to collect payment. However, a common practice by consumers after a loss is to have the contractor that will be making the repairs to the damaged property work directly with the insurance company for payment.

Some insurance providers have simplified this process by developing a network of trusted contractors that are allowed to inspect claims on their behalf. This creates a consumer-friendly environment where the insured, for the most part, is removed from the claims settlement process. However, consumers generally are free to make other choices, so if they decide on a contractor not in that network, the insurer most likely will work with the entity selected by the insured.

When a contractor, who is not in an insurance provider’s network, is chosen, the insured has two options: either receive payment from the insurance company and then work directly with the contractor or allow the contractor to work directly with the insurance company regarding repairs and payment. Insurance companies would likely prefer the first option because they can then more closely monitor the claims process. While the second option may be less desirable to the insurance company, certain states, like Florida, have laws in place that actually prevent the carrier from disallowing it.

What are the concerns with assignment of benefits?

Transferring the benefits of a policy to a third party, such as a contractor, does create a better customer experience; however, insurers generally lose a bit of control managing the claims process when working directly with the third party.

Several states (especially Florida as discussed below) have seen an influx in predatory public adjusters and contractors that seek out consumers who may potentially have a loss covered by their homeowners policy. These adjusters (that may also serve as the contractor making the repairs to the home) will have the consumer sign a transfer of benefits to them almost immediately after suffering the loss, and then they will work directly with the insurance company to complete the claims process.

One issue that arises (and often the consumer is unaware of this) is that the adjuster/contractor could be inflating the actual cost of the claim by reporting damage that may not actually have occurred. Additionally, the claim may not be reported to the insurance company until the repairs have already been completed so the insurance company has not had an opportunity to inspect the damage. Such tactics can result in additional profits for the adjuster/contractor, which translates to inflated severity and rising premiums for the consumer.

This issue may be particularly problematic in Florida, where insurance carriers may not be aware of potential losses until they’re served with a lawsuit for expenses incurred by the contractor that completed the repairs. In fact, the Florida Office of Insurance Regulation (FLOIR) released results from a study it conducted showing that the number of lawsuits attributed to assignment of benefits (AOB) increased from 408 in 2000 to more than 28,000 in 2016. Further, the average severity for claims where there is an AOB is about 85 percent more than those claims without an AOB.

How has this issue escalated?

Several factors have contributed to the growing problem of assignment of benefits in Florida; however, a combination of case law and legislation, which has made it difficult for insurance companies to mitigate claim costs and potential fraud, may be the most impactful.

In the 1917 landmark case of West Florida Grocery Co. v. Teutonia Fire Ins. Co., 77 So. 209, 210-, the state Supreme Court rendered a decision holding that the insured was able to assign the benefits of the policy following a loss directly to a third party without the written consent of the insurance provider. The precedent established by this 100-year-old case continues to make it very difficult for an insurance company to prohibit the assignment of benefits in Florida.

In addition to this case, Florida Statute §627.428 governing payment of attorneys’ fees related to insurance practices requires that insurance companies pay legal fees to third parties successfully suing to obtain payment for their services even if the ruling from the court places the amount of the claim only $1 above the insurance company’s offer in settlement. As a result, this statute incentivizes contractors to sue insurance companies for reimbursement, because the likelihood that they’ll have to pay their own legal fees for the case is very slim.

As reported by The Sun Sentinel earlier this year, consumers in southern Florida could expect to see rate increases averaging 5-15% as a result of claims abuse. Additionally, if it can be assumed that a significant number of the lawsuits complied in the FLOIR study referenced above were initiated by public adjusters and contractors seeking to be unjustly compensated, it could be suggested that this predatory behavior is factoring into these rate increases.

Despite this potential correlation, the legislature has yet to make changes to existing laws. While some members of Florida’s legislature favor the existing legislation, others are advocating for consumers and supporting legislation that would eliminate the abuse. Although remedial legislation did fail in 2017, some members have said they’re hopeful to get legislation passed in 2018.

How is ISO responding?

ISO has been reviewing policy language to determine the best course of action for responding to the growing crisis, especially in Florida. While prohibiting assignment of benefits post-loss altogether is not allowed by state law, several policy provisions can be modified to introduce parameters on how the benefits of the policy can be assigned to a third party. ISO is finalizing these changes and hopes to file in the first quarter of 2018 so that member companies can address this concern with or without any future changes to Florida law.

Personal Property
Risk Assessment
Homeowners Underwriting

Search NAIC

Recommended.

Back to Newsroom

Consumer Insight

Sept. 13, 2023

Assignment of Benefits: Consumer Beware

You've just survived a severe storm, or a tornado and you've experienced some extensive damage to your home that requires repairs, including the roof. Your contractor is now asking for your permission to speak with your insurance company using an Assignment of Benefits. Before you sign, read the fine print. Otherwise, you may inadvertently sign over your benefits and any extra money you’re owed as part of your claim settlement.

The National Association of Insurance Commissioners (NAIC) offers information to help you better understand insurance, your risk and what to do in the event you need repairs after significant storm damage.

Be cautious about signing an Assignment of Benefits. An Assignment of Benefits, or an AOB, is an agreement signed by a policyholder that allows a third party—such as a water extraction company, a roofer or a plumber—to act on behalf of the insured and seek direct payment from the insurance company. An AOB can be a useful tool for getting repairs done, as it allows the repair company to deal directly with your insurance company when negotiating repairs and issuing payment directly to the repair company. However, an AOB is a legal contract, so you need to understand what rights you are signing away and you need to be sure the repair company is trustworthy.

With an Assignment of Benefits, the third party, like a roofing company or plumber, files your claim, makes the repair decision and collects insurance payments without your involvement.
Once you have signed an AOB, the insurer only communicates with the third party and the other party can sue your insurer and you can lose your right to mediation.
It's possible the third party may demand a higher claim payment than the insurer offers and then sue the insurer when it denies your claim.
You are not required to sign an AOB to have repairs completed. You can file a claim directly with your insurance company, which allows you to maintain control of the rights and benefits provided by your policy in resolving the claim.

Be on alert for fraud. Home repair fraud is common after a natural disaster. Contractors often come into disaster-struck regions looking to make quick money by taking advantage of victims.

It is a good idea to do business with local or trusted companies. Ask friends and family for references.
Your insurer may also have recommendations or a list of preferred contractors.
Always get more than one bid on work projects. Your adjuster may want to review estimates before you make repairs.

Immediately after the disaster, have an accurate account of the damage for your insurance company when you file a claim.

Before removing any debris or belongings, document all losses.
Take photos or video and make a list of the damages and lost items.
Save damaged items if possible so your insurer can inspect them, some insurance companies may have this as a requirement in their policy.

Most insurance companies have a time requirement for reporting a claim, so contact your agent or company as soon as possible. Your state insurance department can help you find contact information for your insurance company, if you cannot find it.

Insurance company officials can help you determine what damages are covered, start your claim and even issue a check to start the recovery process.
When reporting losses, you will need insurance information, current contact information and a home inventory or list of damaged and lost property . If you do not have a list, the adjuster will give you some time to make one. Ask the adjuster how much time you have to submit this inventory list. The NAIC Post Disaster Claims Guide has details on what you can do if you do not have a home inventory list.

After you report damage to your insurance company, they will send a claims adjuster to assess the damage at no cost to you . An adjuster from your insurance company will walk through and around your home to inspect damaged items and temporary repairs you may have made.

A public adjuster is different from an adjuster from your insurance company and has no ties to the insurance company.
They estimate the damage to your home and property, review your insurance coverage, and negotiate a settlement of the insurance claim for you.
Many states require public adjusters to be licensed. Some states prohibit public adjusters from negotiating insurance claims for you. In those states, only a licensed attorney can represent you.
You have to pay a public adjuster.
The NAIC Post Disaster Claims Guide has information on the different types of adjusters.

Once the adjuster has completed an assessment, they will provide documentation of the loss to your insurer to determine your claims settlement. When it comes to getting paid, you may receive more than one check. If the damage is severe or you are displaced from your home, the first check may be an emergency advance. Other payments may be for the contents of your home, other personal property, and structural damages. Please note that if there is a mortgage on your home, the payment for structural damage may be payable to you and your mortgage lender. Lenders may put that money into an escrow account and pay for repairs as the work is completed.

More information. States have rules governing how insurance companies handle claims. If you think that your insurer is not responding in a timely manner or completing a reasonable investigation of your claim, contact your state insurance department .

About the National Association of Insurance Commissioners

As part of our state-based system of insurance regulation in the United States, the National Association of Insurance Commissioners (NAIC) provides expertise, data, and analysis for insurance commissioners to effectively regulate the industry and protect consumers. The U.S. standard-setting organization is governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer reviews, and coordinate regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally.

Social Security

Program operations manual system (poms).

TN 35 (04-14)

GN 02410.001 Assignment of Benefits

A. protection from assignment of benefits.

Sections 207 and 1631(d)(1) of the Social Security Act (the Act) prohibit “transfer” or “assignment” of a beneficiary or recipient’s right to future payment under title II and title XVI respectively. These sections of the Act prohibit the transfer of control over money to someone other than the beneficiary, recipient, or the representative payee. These sections also protect the beneficiary or recipient's right to receive payments directly, and to choose how to use the payments.

Our responsibility for protecting payments against legal process and assignment ends when we pay the beneficiary or recipient. However, once paid, Sections 207 and 1631(d)(1) of the Act continue to protect payments as long as we can identify them as:

Retirement, Survivors and Disability Insurance (RSDI) benefits; or

Supplemental Security Income (SSI) payments.

For example, this would include a situation in which RSDI or SSI payments are the only direct deposit payments in the account.

A beneficiary or recipient can use Sec. 207 or 1631(d)(1) of the Act as a personal defense if ordered to pay his or her payments to someone else, or if his or her payments are ordered to be taken by legal process.

B. Exceptions to protection from assignment of benefits

Laws may create exceptions to the protections provided under Sec. 207 and 1631 of the Act, but only if they explicitly identify the applicable section, either Sec. 207 or 1631 (also found in the United States Code as 42 USC 407 or 42 USC 1383), and provide that the law applies despite that section. So far, Congress has authorized the following exceptions to Sec. 207 and 1631 of the Act.

1. Garnishment of benefit payments for child support or alimony

Garnishment is the legal process of withholding an amount from money owed to a person in order to pay off the person’s debt to another. Under Sec.459 of the Act (42 USC 659), garnishment of benefit payments for the purpose of collecting amounts owed for child support or alimony is permitted. For policy on garnishment of title II benefits, see GN 02410.200 through GN 02410.225 .

2. Garnishment of benefit payments for victim restitution

Garnishment of benefit payments to recover court-ordered victim restitution is permitted under 18 USC 3613(a), 3663, 3663A, and 3664. For policy on garnishment for court-ordered victim restitution, see GN 02410.223 .

3. Levy for unpaid federal taxes

Levy is the legal seizure of property, such as Social Security benefit payments, to recover a debt. The IRS places a levy on benefit payments to recover unpaid federal taxes under 26 USC 6331 and 6334. For policy on IRS levy, see GN 02410.100 .

C. Fees and automatic withdrawals

State or Federal government guidelines do not regulate financial institution (FI) fees. These fees are a matter of contract between banks and their customers. Customary fees outlined in account contracts with FIs, and the automatic withdrawal of these fees, do not constitute an assignment of benefits. For a definition of an acceptable FI, see GN 02402.030 .

1. Financial institution

The following banking options meet Treasury’s definition of an acceptable FI:

Savings and loan associations,

Credit unions, or

Thrift institutions.

For policy on acceptable financial institutions, see GN 02402.030 .

NOTE : A master sub-account is an account at an FI established to receive deposits on behalf of a group of individuals. Sub-accounts are then set up at the same FI, another FI, or on the individual ledgers maintained by the master account holder. An acceptable master sub-account relationship is not an assignment of benefits. For policy on acceptable master sub-account relationships, see GN 02402.050 .

2. Account fees

We do not prohibit automatic withholding of account fees from accounts holding SSA payments when those fees are customary to accounts with the FI.

A fee is “customary” if it is consistent with fees associated with similar accounts at the FI and the same fees apply to both federal and non-federal deposits.

NOTE : We should question fees that apply only to federal payments. If the FI applies different fees to federal and similar non-federal deposits, send the issue in question to the Regional Office (RO).

3. Pre-authorized withdrawals

A beneficiary recipient, or his or her representative payee, may pre-authorize an FI, or other entity, to withdraw funds from his or her account for a wide variety of purposes (e.g., utility bills, mortgage payments, loan repayments, investments, nursing home fees, etc.). Once the beneficiary recipient, or his or her representative payee, establishes control by receipt and deposit of the payment, these arrangements are allowed, provided they can be terminated at any time. Terminating the arrangement does not mean terminating or canceling the debt. It means that the beneficiary recipient, or his or her representative payee, may terminate the pre-authorized withdrawal arrangement as a method for paying the debt. The right to receive and to choose how to use those payments exists if the beneficiary recipient, or his or her representative payee, can freely terminate this arrangement. If a beneficiary recipient, or his or her representative payee, cannot freely revoke the pre-authorized withdrawal, send the issue in question to the RO.

D. Prohibited arrangements versus acceptable relationships

The beneficiary recipient’s, or his or her representative payee’s, control of the receipt and use of payments will determine if a payment arrangement is prohibited or acceptable.

1. Prohibited arrangements

A. payment to the wrong person.

Do not make payment to any person or entity other than the beneficiary recipient, or his or her representative payee, except as outlined in GN 02410.001B and GN 02410.001C in this section. This prohibition applies regardless of the person or entity who makes the request.

For example, the prohibition applies when:

a beneficiary or recipient requests that we pay his or her payments to someone other than the beneficiary or the beneficiary’s representative payee.

a court orders SSA to make payment to a party other than the beneficiary or recipient, unless one of the specific exceptions in GN 02410.001B in this section exists. For policy on when SSA should not comply with a bankruptcy court’s order to pay benefits to a bankruptcy trustee, see GN 02410.005 .

When you are unable to determine whether there is a prohibited arrangement, send the issue in question to the RO.

b. Other prohibited arrangements

Even if the payment goes directly to the beneficiary or recipient (or the representative payee), the arrangement may is prohibited if the beneficiary or recipient surrenders control of the payments. Avoid any arrangement where the beneficiary or recipient surrenders or shares control of payments with a person or entity that has an interest in charging or collecting money from the beneficiary or recipient.

Avoid the following situations:

Do not approve sending a payment, either by check or electronically, to a loan company where the beneficiary or recipient has a loan, or to a party holding the beneficiary or recipient's power of attorney. For information on power of attorney, see GN 02410.010 .

Do not approve a bank account when the attorney or non-attorney representative has the power to withdraw funds so that representative’s fees can be collected directly from that beneficiary or recipient’s account. See the note in GN 03920.025A . For policy on unacceptable requests for direct deposit, see GN 02402.085 .

In both scenarios given, the arrangement is prohibited because the beneficiary or recipient surrenders control over the payment.

When you are unsure of a prohibited arrangement, send the issue in question to the RO.

2. Acceptable relationships

A. third-party repayment.

Third parties may employ representatives to ensure that beneficiaries or recipients repay debts owed to the third parties immediately after the beneficiary or recipient starts to receive payment. This arrangement is acceptable if:

The third-party representative has no financial interest in the beneficiary or recipient’s direct deposit account (i.e., he is not named on the account and has no authority to direct the money in the account);

The third party representative is not charging the beneficiary or recipient a fee;

The beneficiary or recipient pre-authorizes, (according to the financial institution’s policy), a withdrawal of funds from his account to repay a debt to a third party;

The third-party representative did not obtain the pre-authorization from the beneficiary or recipient through deceit, coercion, or intimidation; and

The third-party representative gets oral or written confirmation from the beneficiary or recipient of the pre-authorization to withdraw the money from the account after we deposit funds into the beneficiary or recipient’s account and before a transfer of funds to pay the third party debt.

NOTE : Confirmation is necessary because a beneficiary or recipient may have signed the pre-authorization before learning whether he or she will receive benefits and the amount of past-due benefits he or she will receive. In this situation, confirmation prevents the third party from taking funds before the beneficiary or recipient exercises control over the funds.

b. Financial institution-electronic funds distributor (FI-EFD) accounts

Some FI have established Electronic Funds Distributor (EFD) relationships with various check cashing establishments to receive and distribute monthly direct deposit payments to assist SSA beneficiaries or recipients who do not have traditional bank accounts.

The FI receives the monthly payment by direct deposit titled under the beneficiary or recipient’s name. Then, the FI electronically transfers payment to the contracted EFD. The EFD, acting as an agent of the FI, will then release the monthly payment to the account holder in the form of a cashier’s check.

These FI-EFD accounts are acceptable and not prohibited if they meet the following requirements:

The FI must be acceptable under United States Treasury guidelines. (For policy on acceptable types of financial institutions, see GN 02402.030A .)

The EFD must have a contract with and act as an agent of the FI.

The FI account must be acceptable as outlined in GN 02402.030 B.1 .

A secondary contract relationship that attaches the FI-EFD transaction account as collateral for loan fees associated with the EFD cannot exist as a requirement for participation between the EFD and the beneficiary or recipient.

No person or entity can have control over the receipt, or use of, SSA benefit payments other than the beneficiary or his or her representative payee. (For Assignment of Benefits, see GN 02410.001 and Sec.1631 (d)(1).)

The beneficiary, recipient, or representative payee may cancel his or her FI-EFD direct deposit arrangement at any time.

Fees associated with the account must be customary to fees for similar accounts at the FI and those fees are outlined in the FI-customer contract.

When you are unable to clearly determine whether an FI-EFD account is acceptable, send the issue in question to the RO.

E. Examples of acceptable and prohibited relationships

1. acceptable relationship.

A company pays long-term disability (LTD) benefits to a customer and requires them to file for Social Security title II benefits. When the Social Security claim is allowed, the amount of Social Security benefits received offsets the LTD benefit amount. As an incentive to induce the LTD insurer to refer claimants, the claimant’s LTD representative offers to assist the insurer with recovering the overpayment the insurer made to the claimant. The LTD representative does not charge the claimant a fee for this service. The LTD representative also makes it clear to the claimant that he or she may pay the LTD directly and does not have to pay the LTD through the representative.

At the LTD representative’s request, the claimant gives the representative pre-authorization to withdraw funds from the claimant’s bank account if SSA approves the claim and issues the claimant past-due benefits.

After we approve the claim and deposit the past-due benefits into the claimant’s account, the LTD representative gets oral authorization (in addition to the pre-authorization) to transfer those funds to the LTD insurer to satisfy the LTD overpayment. The LTD representative also documents the oral authorization. We will accept this arrangement. The beneficiary is exercising control over the past-due benefits deposited into his or her account before the pre-authorized transfer of funds, and the beneficiary understands that he or she could have elected to pay the LTD directly. The LTD provider does not receive a fee from the beneficiary and obtains a pre-authorization to transfer funds from the beneficiary’s account in order to repay the third party (i.e., the overpayment of payments from the insurer). The LTD representative also gets authorization after deposit of the SSA benefit payment into the beneficiary’s account. For policy on acceptable third-party repayment arrangements, see GN 02410.001D.2.a. , in this section.

b. Master sub-account

Comfort Nursing Home maintains a master sub-account titled “Comfort Nursing Home Patients' Accounts” at New State Bank for the convenience of its residents. The nursing home sets up a separate sub-account for each resident. Residents sign agreements for the nursing home to withdraw monthly amounts for care costs. Residents can withdraw any amount, up to the balance in their accounts for personal expenses and they have the right to terminate the account at any time. The nursing home keeps track of all deposits and withdrawals. This is an acceptable master sub-account. For policy on acceptable master sub-accounts with FI, see GN 02402.050 .

c. FI-EFD

Big Bucks Bank Inc. (BBB) is an accepted FI. BBB offers the “We-Pay-U” program for customers without traditional bank accounts. We-Pay-U program customers sign a contract and establish a non-interest bearing account with BBB for the sole purpose of electronic transfer of federal or non-federal monthly payments to that account. Beneficiaries or recipients can then receive their SSA payments in the form of a cashier's check from Brown Bear Check Cashing. Brown Bear Check Cashing acts as an agent of BBB and must adhere to the rules and regulations of BBB in relation to the We-Pay-U account. The We-Pay-U customer agrees to a monthly processing fee associated with the We-Pay-U account, which BBB withdraws from their payment automatically. This is an acceptable relationship. The beneficiary or recipient has established control of their payment and the fees associated with the We-Pay-U program. Because the account fees in the contract apply to both federal and non-federal monthly payments, we consider them customary to the BBB account. For policy on acceptable FI-EFD arrangements, see GN 02410.001D.2.b. in this section.

2. Prohibited arrangement

A beneficiary or recipient has appointed an attorney representative to help him in proceedings before SSA. SSA is not paying an attorney fee directly to the representative. The beneficiary or recipient establishes a checking account in his or her own name that requires the signature of both the beneficiary or recipient and the attorney on checks written to withdraw funds from the account. The beneficiary or recipient requests direct deposit of his or her payments to that account. This is a prohibited arrangement because the beneficiary or recipient has given control of access to payments to the attorney representative. See the following references for additional information:

For policy on Who is a Representative, see GN 03910.020 .

For policy on representative’s fees in trust or escrow accounts, see GN 03920.025 .

For policy on acceptable types of financial institutions and accounts, see GN 02402.030 .

For policy on payment to the wrong person, see GN 02410.001D.1. , in this section.

F. References

GN 02402.030 Acceptable Types of Financial Institutions and Accounts

GN 02402.050 Account Titles

GN 02402.085 Unacceptable Requests for Direct Deposit

GN 03910.020 Who Is a Representative

GN 03920.017 Payment of Representative's Fee

GN 03920.025 Representative's Fee - Trust or Escrow Accounts

	You might be using an unsupported or outdated browser. To get the best possible experience please use the latest version of Chrome, Firefox, Safari, or Microsoft Edge to view this website.

What Is Ad Retargeting? Definition, Examples And Best Practices

Published: Aug 20, 2024, 8:31am

What Is Ad Retargeting? Definition, Examples And Best Practices

What is ad retargeting, how does ad retargeting work, retargeting vs. remarketing, types of retargeting, platforms for running retargeted ads, best practices of retargeting, bottom line, frequently asked questions (faqs).

Driving people to your website is an essential part of advertising, but ensuring customers complete their purchase is equally important. All too often, potential buyers browse for a while and then leave a site without actually converting. That’s where ad retargeting comes into play, providing a strategy to keep your brand in front of eyes, even after they have moved on to something else. Let’s discuss what ad retargeting is, why it’s important and some best practices for utilizing it.

Ad retargeting is a type of online advertising that allows small businesses to recapture potential leads after they have left their website without completing a purchase. Through digital marketing, you can build brand awareness by reaching customers who have already expressed interest in your products or services. Ad retargeting helps businesses stay visible to buyers as they move across different websites, providing a constant reminder about what they had previously been searching for.

Benefits of Ad Retargeting

The goal of ad retargeting is to locate and engage with buyers who are interested in what you are selling, with the intention of bringing them back to your store to make a purchase. It is an important component of the sales funnel since it can be used at any stage of the buyer’s journey. There are many benefits to ad retargeting, including:

Expanded brand awareness
Shortening the sales funnel process
Improving your advertising performance
Increased sales
Better audience understanding
Higher ROI (return on investment)
Retaining existing customers

Featured Partner

HigherVisibility

Starting at $1,250 per month

Memphis, TN

On Highervisibility's Website

Starting at $2,500 per month

Harrisburg, PA

On WebFX's Website

Ad retargeting works by relying on cookies to continue following users once they have been on your site and then placing customized display ads into their feed. These ads promote your brand, along with the specific items that the customer has been viewing, in order to increase visibility. Since potential buyers often need to see something multiple times before they are willing to complete a purchase, retargeting does the legwork of repeatedly putting your products in front of them with little effort needed on your part.

Retargeting seeks to capture your target audience, from those who have abandoned shopping carts in your online store to those who have interacted with your business via Instagram. It’s a crucial tool for converting more leads and can be utilized on several platforms, including Google Ads, Facebook ads, search engines and social media.

Although the terms retargeting and remarketing are sometimes used interchangeably, they are two different concepts. While retargeting delivers targeted ads to customers, remarketing focuses on engaging via email with people who have already purchased from your brand. Both try to achieve the same outcome of building brand awareness and engaging with customers, but they use separate marketing tactics to meet that goal.

There are several different types of retargeting and the ones you choose to adopt will depend on what you are selling and to whom. Ultimately, retargeting ads aim to encourage customers to go back to your website and complete a desired action, such as making a purchase, signing up for a freebie or booking an appointment. Here are some examples of different types of ad retargeting:

Website Retargeting

Website retargeting involves recapturing customers who did not make a purchase or “convert” while browsing your website. These types of ads are the most common and are specifically designed to appear in front of only past visitors instead of the general public. It’s a particularly effective strategy for abandoned shopping carts since it serves as a frequent reminder that the items they viewed are still waiting to be purchased.

Cross-Channel Retargeting

Cross-channel retargeting uses tracking pixels to follow audiences across different devices and platforms in order to encourage potential buyers to keep moving through the sales funnel. Tracking pixels are small graphics that load when someone visits a webpage. They collect data about users, and are designed to blend into pages so that they are not noticed. These pixels then follow users around the web, dropping ads strategically.

Search Engine Retargeting

Search engine retargeting examines keywords that a user has searched for and then displays ads relevant to those keywords. The ads then follow potential buyers across the web, continuing to pop up on the different sites they browse. This strategy is most effective when businesses create a list of keywords that they want flagged and then target people who are searching for those exact keywords.

Social Media Retargeting

Social media retargeting displays ads to customers on the social media platforms they browse after visiting your website. The goal of placing these ads on places such as Facebook, Instagram, X, LinkedIn and Pinterest is to connect with your target audience in a new way, such as through videos or other visual avenues, re-engaging potential buyers and converting more leads with relevant content.

Mobile App Retargeting

Mobile app retargeting takes your advertising on the go, targeting users who have previously installed your app and stopped engaging with it over time. It also directs ads at customers who have visited the landing page for your app but have not downloaded it yet. By creating ads that focus on these two groups of potential buyers, your business can focus on the people who are already invested in your product or service instead of trying to attract brand-new shoppers.

Ad retargeting provides additional chances for businesses to convert browsers into buyers and remind these customers about your products or services. Depending on the type of business you have and the audience you are targeting, the platforms you choose to run ads on can make or break your sales goals. These are some of the platforms available for running retargeted ads:

Google Ads are one of the most popular and effective ways to connect with buyers. Because Google has such an extensive reach, ads on this platform have the power to appear not only on the search engine’s network but also on the partner websites they are affiliated with. On this platform, potential customers will see your ads when they search for similar products, and you’ll also have the option to create campaigns tailored to your audience.

Meta Ads Manager

Utilizing Meta Ads Manager packs a powerful punch since the network includes Facebook, Instagram, Messenger and WhatsApp. You’ll start with a list of people who have previously engaged with your brand and then send targeted ads directly to them. Another option the platform offers is the Meta Pixel, which tracks the people and the types of actions they take when engaging with your brand, the pages of your website they visit and the items they add to their shopping carts.

X (Twitter) Ads

On X, formerly Twitter, you can remarket to people who have visited your website, engaged with your posts, subscribed to your newsletter or interacted with your business in other ways. X Ads allows you to work with specific groups of people based on lists you already have, or you can target buyers who’ve recently visited your website, collected through X’s website tag or X’s Official Partner Program. Once you’ve launched your remarketing campaign, the platform also provides more advanced conversion tracking options.

LinkedIn Ads

LinkedIn offers its Matched Audiences feature, which helps retarget website visitors and adjust your messaging to better meet their needs. The tool allows businesses to view the status of their audiences, create and edit different groups, share audiences across ad accounts and leverage member data in order to market to their ideal customers.

Businesses need to walk a fine line when it comes to ad retargeting. You want to stand out and be memorable, but not be overzealous and annoying, which can repel potential buyers. Whether you are retargeting a former customer who hasn’t made a purchase for some time or aiming to drive new traffic to your website, follow these best practices to achieve the best possible results.

Understand Your Audience

Before you invest time and money in ad retargeting, you must understand your audience. Customers at every stage of the buyer journey will be browsing your website, so segment your customers according to what stage they are in and tailor your ads to each group accordingly.

Start With One Platform

It’s best to start small, preferably with one platform, to gain an understanding of how ad retargeting works and where your target audience is spending their time. Google Ads is probably the most logical platform to start with since nearly everyone uses the search engine and it has many partner affiliates that would also display your ads.

Keep It Simple

Buyers want to see ads that are direct and address their needs, so don’t oversaturate your retargeting with too much wording or imagery. Make it visually appealing and simple in order to attract more eyes and achieve more clicks.

Include a Call to Action

While keeping your message simple, be sure to include a call to action (CTA) for customers to follow. Whether you are offering a discount, freebie or other incentive, explicitly spelling out what you want the buyer to do makes your messaging more effective.

Seeing the same ads over and over is not only annoying, it makes your brand less visible because people stop paying attention. Set limits on how often an audience sees retargeted ads, and be aware that every ad has a shelf life.

Make It Personal

The best retargeted ads are the ones that are highly specific to a certain segment of buyers, providing different content for different people. By understanding your audience and looking at their data, your business can create a retargeted ad strategy that is designed to be both personal and persuasive.

Ad retargeting is a proven technique that allows small businesses to keep their brand in front of potential customers who have visited their website but have not made a purchase. It’s a way to grab visitors’ attention, bring them back to your website and convert them into buyers. If done correctly and thoughtfully, ad retargeting can build your visibility, increase sales and create more loyal customers.

How does ad retargeting work?

When users visit a website, their browser collects data called “cookies,” which track and record their actions while browsing the site. Based on this collected information, businesses can create retargeted ads that will follow the user after they leave the site and continue to show them ads about what they were looking for.

What platforms should be used for ad retargeting?

Google Ads is the largest platform for ad retargeting and is appropriate for businesses of all sizes. It’s a good place to start as you figure out how ad retargeting works and what content your audience wants to see. You can also expand to social media platforms such as Meta, X and LinkedIn.

Best SEO Software For Small Business
Best Social Media Management Software
Best Email Marketing Software
Best SEO Services For Small Business
Best Mass Texting Services
Best Mailchimp Alternatives
Best ActiveCampaign Alternatives
Top SEMRush Alternatives
Top ahrefs Alternatives
Hootsuite Review
MailerLite Review
ActiveCampaign Review
Constant Contact Review
Sprout Social Review
SEMRush Review
Mailchimp Review
Small Business Marketing
What Is Marketing?
What Is Digital Marketing?
Digital Marketing Strategy Guide
Digital Marketing Tips
Search Engine Marketing Guide
SEO Marketing Guide
Social Media Marketing
Content Marketing
PPC Advertising Guide
Tips For Generating Leads Online
The 4 Ps Of Marketing
How To Get More Followers On Instagram
How To Start A Podcast
E-Commerce SEO
WordPress SEO Guide

Next Up In Marketing

Best SEO Tools & Software
Best Social Media Management Tools
Best SEO Services
Best Chatbots

What Is A Corporate Resolution?

What Is Digital Transformation?

What Are Banner Ads? Definition, Examples And Best Practices

7 Essential SEO Metrics To Track In 2024

How To Advertise On Google In 2024

International SEO Best Practices In 2024

Laura is a freelance writer specializing in small business, ecommerce and lifestyle content. As a small business owner, she is passionate about supporting other entrepreneurs and sharing information that will help them thrive. Her work has been featured on Angi, Scary Mommy and Cubby.

Company management

Procure-to-Pay: How a Modern Solution Can Drive Cost Savings and Efficiency

Did you know that companies implementing a modern Procure-to-Pay solution can reduce their procurement costs by up to 30 percent ? The reason: Procure-to-Pay (P2P) is a value-adding process that covers the entire procurement cycle from ordering to payment. In this article, you'll learn exactly what Procure-to-Pay is, how it works, and what benefits a digital solution like Agicap can offer your business.

Definition: What is Procure-to-Pay?

Procure-to-Pay (P2P), also known as Purchase-to-Pay, refers to an integrated process within procurement that encompasses all steps from identifying a need to the final payment to suppliers.

The P2P process includes several phases:

Needs identification: The process begins with identifying a need for goods or services. This can occur across various departments within the company that require specific materials or services.
Ordering: After identifying the need, a purchase order is created and approved. This is then sent to suppliers. In modern P2P systems, this step often occurs electronically, significantly reducing processing time.
Order processing: Suppliers receive the order and begin fulfillment. This step involves providing the ordered goods or services within the agreed-upon timeframes.
Goods receipt and inspection: Upon receiving the goods or services, an inspection is carried out to ensure the delivery meets the requirements and specifications. This step is crucial to ensure that only properly delivered and specified items are paid for.
Invoicing: Suppliers issue an invoice for the delivered goods or services. The company reviews this invoice and reconciles it with the purchase order and goods receipt.
Payment: After successfully verifying the invoice, payment is made to the suppliers. This can take varying lengths of time depending on payment terms and agreements.

Why Use a Modern P2P System?

The " 2023 Procurement Value Measurement Study " by the Hackett Group shows that inflation and recession were the biggest economic challenges of 2023. These issues also affect procurement organizations, which face the task of reducing costs and maximizing the value of their processes. In this context, cost savings and value measurement are crucial factors for success.

A modern Procure-to-Pay system (P2P system) provides the necessary infrastructure to meet these challenges. Through automation and improved transparency, a P2P system enhances financial sustainability and secures long-term profits. This demonstrates that P2P systems contribute significantly to overcoming economic disruption successfully.

How Does Procure-to-Pay (Purchase-to-Pay) Work?

The Procure-to-Pay process involves several key phases that interlock to effectively and transparently manage the entire procurement cycle. Each phase plays a clear role, as goods and services must be paid for on time through a functioning cash flow to ensure seamless procurement.

Cloud-based P2P applications, e-procurement, and digital source-to-pay solutions provide the infrastructure to comprehensively manage the procurement process across the entire company. We'll explain the individual steps in detail:

1. Needs Identification

Analysis of needs: Identify required goods or services across various departments. Approval: Ensure the need is approved by management to avoid unnecessary expenditures.

2. Supplier Selection and Ordering

Supplier selection: Evaluate and select suitable suppliers based on criteria such as price, quality, and delivery time.

Ordering: Create and transmit the order to selected suppliers. In modern P2P systems, this typically occurs via e-procurement platforms that automate and accelerate the process.

3. Goods Receipt and Inspection

Goods receipt: Receive the ordered goods or services. Quality inspection: Verify that the delivery meets specifications. This is crucial to ensure that only flawless products are paid for.

4. Invoice Reconciliation and Verification

Invoice reconciliation: Compare the received invoice with the purchase order and goods receipt. Approval: Release the invoice for payment after all details have been verified.

Payment approval: Authorize the payment through financial management.

Payment execution: Carry out the payment to suppliers according to agreed-upon payment terms.

Benefits of a Procure-to-Pay Solution

The digitalization of the P2P process brings numerous advantages. By implementing Procure-to-Pay software, you primarily benefit from the following:

1. Reduction of manual tasks:

E-procurement software automates many manual tasks. This automation improves workflow and reduces errors.

2. Faster transactions:

Automated systems can process orders and payments more quickly, positively impacting process duration.

3. Real-time overview:

Digital solutions provide real-time data across the entire procurement process. This helps manage purchase requisitions and identifies issues promptly.

4. Improved decision-making:

Transparency, including access to detailed analyses and reports, aids in strategic planning and decision-making. https://agicap.com/en-us/article/liquidity-planning/

5. Spend optimization:

Through accurate needs analysis and automated processes, companies can optimize expenditures and achieve cost savings.

6. Error prevention:

Automated checks and payment reconciliations minimize the risk of errors and fraud.

7. Effective communication:

Digital platforms facilitate communication and collaboration with suppliers, leading to better business relationships.

8. Enhanced supplier relationships:

A well-functioning P2P system ensures timely payments, increasing supplier satisfaction.

Example: Procure-to-Pay with Agicap

A concrete example of the successful implementation of a Procure-to-Pay system is Agicap. We offer a software solution specifically developed to optimize cash flow and liquidity management. By integrating Procure-to-Pay functions, the software enables seamless management of the entire procurement process.

Optimize Your Cash Management

Companies can more accurately control their expenses, automate payment processes, and create precise liquidity forecasts. Agicap's solution demonstrates how businesses can both save costs and improve their overall financial planning and control by digitalizing their P2P process.

Agicap's Functions as a Procure-to-Pay Tool

Agicap offers a range of features that make it an attractive P2P application and could even be considered as a replacement for traditional P2P systems. Its specialization in liquidity management, easy integration and use, as well as automated data aggregation make Agicap a powerful spend management software for businesses.

As a foundation for cash flow optimization, it provides detailed real-time insights into the financial situation. The platform is user-friendly and can be seamlessly integrated into existing ERP and financial systems, facilitating implementation.

Agicap's flexibility and quick adaptability to a company's specific needs are particularly advantageous in rapidly changing markets, which have become increasingly common since the COVID-19 pandemic. Through real-time monitoring of financial flows and precise forecasts, Agicap helps companies plan their expenses and ensure they have sufficient liquidity to meet their obligations.

With these functions, Agicap complements traditional P2P systems by enabling more comprehensive control and optimization of the entire procurement process while acting as modern forecasting software.

Additional Benefits of Agicap

Comprehensive financial management: Complements P2P functions with strong liquidity management.
Real-time monitoring and forecasts: Provides precise data for expense planning and ensuring liquidity.
Improved decision-making: Offers up-to-date and accurate data for informed decisions.
Cost control and efficiency improvement: Automates financial processes, reduces manual effort and error susceptibility.

Through these advantages, Agicap helps businesses optimize their costs and revenue management and effectively manage their liquidity. While traditional Procure-to-Pay systems cover the entire procurement process from order to payment, Agicap offers additional depth and precision in financial management.

FAQ: Frequently Asked Questions about Procure-to-Pay and Procure-to-Pay Software

What is a procure-to-pay process.

A Procure-to-Pay process encompasses all steps from needs identification through ordering and goods receipt to invoice verification and payment.

What is S2P?

Source-to-Pay (S2P) is a comprehensive process that integrates supplier selection (sourcing) and the entire procurement and payment management.

What is meant by Purchase-to-Pay?

Purchase-to-Pay (P2P) is synonymous with Procure-to-Pay and describes the complete procurement cycle from ordering to payment.

Subscribe to our newsletter

IMAGES

What is an Assignment of Benefits Agreement?
What is an Assignment of Benefits and How Does it Affect You?
What is Assignment of Benefits in Medical Billing
What Are The Benefits Of Assignment Help Perth? : r/Students_AcademicHelp
PPT
What is the assignment of benefits in medical billing?

COMMENTS

What is assignment of benefits, and how does it impact insurers?
Assignment of benefits, widely referred to as AOB, is a contractual agreement signed by a policyholder, which enables a third party to file an insurance claim, make repair decisions, and directly ...
Assignment of Benefits: What It Is, and How It Can Affect your ...
What is an Assignment of Benefits? In the context of insured property claims, an assignment of benefits (AOB) is an agreement between you and a contractor in which you give the contractor your right to insurance payments for a specific scope of work.In exchange, the contractor agrees that it will not seek payment from you for that scope of work, except for the amount of any applicable deductible.
Assignment of benefits explained
Assignment of benefits in Florida: a case of rampant fraud. Because the assignment of benefits takes control out of the homeowner's hands, insurance fraud is a major concern. Some contractors may take advantage of the situation and inflate repair needs and costs or bill for work that was never completed. They may also hire attorneys to sue ...
Assignment of Benefits: What You Need to Know
There are many reasons why an insurance company may not accept an assignment of benefits. To speak with a Schwartzapfel Lawyers expert about this directly, call 1-516-342-2200 for a free consultation today. It will be our privilege to assist you with all your legal questions, needs, and recovery efforts.
Assignment of Benefits (AOB)
An assignment of benefits (AOB) is a contractual agreement that enables a third party to access insurance benefits on behalf of the policyholder. [1] When the policyholder signs an AOB agreement, it grants the third party the authority to initiate an insurance claim and receive reimbursement directly from the insurance company.
What is an assignment of benefits (AOB)?
Assignment of benefits is legal, thanks to a concept known as freedom of contract, which says two parties may make a private agreement, including the forfeiture of certain rights, and the ...
Assignment of Benefits vs Direction to Pay vs Assignment of Policy
Direction to Pay vs. Assignment of Benefits. Direction to pay (DTP) is a financial arrangement where the policyholder, who is entitled to receive an insurance claim payment, instructs the insurance company to pay the claim proceeds directly to a third party. This third party could be a vendor, contractor, service provider, or any other entity ...
What is Assignment of Benefits (AOB)?
Assignment of benefits is a document that directs payment to a third party at the insured's request. It becomes legitimate once both the insured party and their insurer have signed the AOB form. AOB is used in a number of insurance contexts, such as paying physicians or clinics through health insurance or paying contractors for repairs ...
All You Need to Know About Assignment of Benefits
When you sign an assignment of benefits agreement, you bypass dealing with an insurance company's claims department and allow the benefits to be paid directly to the provider. For example, the assignment of benefits medical definition is when you sign a form that requires your health insurance provider to pay the hospital or physician directly.
What is an Assignment of Benefits?
Assignment of benefits for homeowners . When your home or belongings are damaged or destroyed, your primary concern is to "return to normal.". You want to do this with the least amount of hassle. An AOB allows you to transfer your rights to a third party, usually a contractor, freeing you to deal with the crisis at hand.
Assignment of benefits
Assignment of benefits (AOB) is a crucial concept in the healthcare revenue cycle management (RCM) process. It refers to the legal transfer of the patient's rights to receive insurance benefits directly to the healthcare provider. In simpler terms, it allows healthcare providers to receive payment directly from the insurance company, rather ...
What is Assignment of Benefits in Medical Billing?
An assignment of benefits is the act of signing documentation authorizing a health insurance company to pay a physician directly. In other words, the insurance company can pay claims without the direct involvement of the patient in the process. There are other situations where AOBs can be helpful, but we'll focus on their use in relation to ...
What is Assignment of Benefits in Medical Billing
An assignment of benefits in medical billing is a type of agreement between the healthcare provider, insurance company, and the patient through which a patient authorizes the medical service to collect healthcare policy coverage benefits on their behalf from their insurer for the service they have received from the facility.
What Should An Assignment of Benefits Form Include?
An assignment of benefits form (AOB) is a crucial document in the healthcare world. It is an agreement by which a patient transfers the rights or benefits under their insurance policy to a third-party - in this case, the medical professional who provides services. This way, the medical provider can file a claim and collect insurance payments.
Assignment of Benefits (AOB)
Assignment of Benefits (AOB) is an agreement that transfers the insurance claims rights or benefits of the policy to a third party. An AOB gives the third party authority to file a claim, make repair decisions, and collect insurance payments without the involvement of the homeowner. AOBs are commonly used in homeowners' insurance claims by ...
What is an assignment of benefits?
An assignment of benefits (AOB) is a legal agreement you sign that lets a third party negotiate, bill, and receive payment from your insurance provider.
Assignment of benefits: A growing concern
The precedent established by this 100-year-old case continues to make it very difficult for an insurance company to prohibit the assignment of benefits in Florida. In addition to this case, Florida Statute §627.428 governing payment of attorneys' fees related to insurance practices requires that insurance companies pay legal fees to third ...
Assignment of Benefits: Consumer Beware
An Assignment of Benefits, or an AOB, is an agreement signed by a policyholder that allows a third party—such as a water extraction company, a roofer or a plumber—to act on behalf of the insured and seek direct payment from the insurance company. An AOB can be a useful tool for getting repairs done, as it allows the repair company to deal ...
Assignment and Non-assignment of Benefits
Non-assignment of Benefits. Non-assigned is the method of reimbursement a physician/supplier has when choosing to not accept assignment of benefits. Under this method, a non-participating provider is the only provider that can file a claim as non-assigned. When the provider does not accept assignment, the Medicare payment will be made directly ...
Assignment of Benefits
Assignment of benefits is not authorization to submit claims. It is important to note that the beneficiary signature requirements for submission of claims are separate and distinct from assignment of benefits requirements except where the beneficiary died before signing the request for payment for a service furnished by a supplier and the ...
SSA
A. Protection from assignment of benefits. Sections 207 and 1631 (d) (1) of the Social Security Act (the Act) prohibit "transfer" or "assignment" of a beneficiary or recipient's right to future payment under title II and title XVI respectively. These sections of the Act prohibit the transfer of control over money to someone other than ...
Assignment of Benefits Definition: 201 Samples
definition. Assignment of Benefits means an arrangement whereby the Plan Participant assigns their right to seek and receive payment of eligible Plan benefits, in strict accordance with the terms of this Plan Document, to a Provider. If a provider accepts said arrangement, Providers' rights to receive Plan benefits are equal to those of a ...
What Is Considered a Mobility Disability?
A mobility disability is a physical impairment that affects movement. If it is long term, a mobility disability could qualify for disability benefits. A mobility disability is a physical ...
What Is Ad Retargeting? Definition, Examples And Best Practices
Definition, Examples And Best Practices Laura Hennigan Small Business Writer Laura is a freelance writer specializing in small business, ecommerce and lifestyle content.
Assignment and Nonassignment of Benefits
The second reimbursement method a physician/supplier has is choosing to not accept assignment of benefits. Under this method, a non-participating provider is the only provider that can file a claim as non-assigned. When the provider does not accept assignment, the Medicare payment will be made directly to the beneficiary.
Procure-to-pay (P2P) : Complete Guide
Benefits of a Procure-to-Pay Solution. The digitalization of the P2P process brings numerous advantages. By implementing Procure-to-Pay software, you primarily benefit from the following: 1. Reduction of manual tasks: E-procurement software automates many manual tasks. This automation improves workflow and reduces errors. 2. Faster transactions:

Assignment of Benefits: What It Is, and How It Can Affect your Property Insurance Claim

What is an Assignment of Benefits?

How Does an Assignment of Benefits Work in Practice?

Are There any Downsides to Signing an Assignment of Benefits?

Do I have to sign an Assignment of Benefits?

Are There any Benefits to Signing an Assignment of Benefits?

Can my insurance policy restrict the use of AOBs?

Do I have any rights or protections concerning Assignments of Benefits?

Protections in the AOB Contract

Contractor Duties

Recommended Posts

Assignment of benefits

What is an assignment of benefits?

Why do homeowners agree to an assignment of benefits?

Assignment of benefits in Florida: a case of rampant fraud

What responsibilities does the AOB contractor have?

How assignment of benefits impact homeowners

Protecting yourself in an assignment of benefits agreement

Related Posts: Keep exploring

Practice Areas

Assignment of Benefits: What You Need to Know

What Is an Assignment of Benefits?

What Does an Assignment of Benefits Mean?

What Types of Insurance Qualify for an Assignment of Benefits?

Who Uses Assignments of Benefits?

Advantages of Using an Assignment of Benefits

Risks of Using an Assignment of Benefits

How To Make Sure an Assignment of Benefits Is Safe

Can You Sue a Party for Abusing an Assignment of Benefits?

Assignment of Benefits FAQs

Can You Revoke an Assignment of Benefits?

Contact Schwartzapfel Lawyers Today

Related Posts

When Is It Too Late To Get A Lawyer For A Car Accident?

Motion Of Discovery: What Does It Actually Mean?

We'll Fight For You

Assignment of Benefits for Homeowners

How Do Assignment of Benefits Work?

Coverage Verified

Mutual Agreement

Billing Submission

Claim Evaluation

Direct Payment

Policyholder’s Responsibility

Service Rendered

Example of an Assignment of Benefits

When Would You Use Your Assignment of Benefits?

Pros & Cons of Using Assignment of Benefits

Making Sure Your AOB Is Safe & Secure

Assignment of Benefits Being Abused: What Are My Options?

Contact Your Insurer

Report Fraud

Seek Legal Counsel

Know About Potential Litigation

Frequently Asked Questions About Assignment of Benefits (AOB) for Homeowners

Related Pages

What is an assignment of benefits?

What is an assignment of benefits?

How an AOB works

Example of an assignment of benefits

When would you need to use an assignment of benefits?

Assignment of benefits for health insurance

Assignment of benefits for car owners

Assignment of benefits for homeowners

The fraud factor

Pros and cons of an assignment of benefits

The takeaway

About the contributors

Assignment of Benefits vs Direction to Pay vs Assignment of Policy

Assignment of Benefits vs. Assignment of Policy

Direction to Pay vs. Assignment of Benefits

A Final Word

WHO WE SERVE

PRIVACY POLICY

Connor Trahan

Nicole Liesenfelt

Elizabeth McGlone

Alisha Yartzoff

Co-Founder and General Counsel

Jeremy Traasdahl