If you recently experienced damage to your property from a storm, we would like to help you protect yourself. Please take caution in speaking with individuals or companies who may come to your home and offer to help with repairs. It is important that you never pay for repairs in advance of completed work, and don’t sign an Assignment of Benefits (AOB) contract to start the repair process.

Unfortunately, property damages could create opportunities for dishonest individuals seeking to profit from losses.

An AOB is a contract signed by the homeowner, after a covered loss, that grants a contractor all rights and duties of the claim under the insurance policy. This could be for any damage to insured property, such as a roof, siding, gutters, deck, windows or other household features.

Once that contract is signed, the contractor now owns all rights and duties to the claim. There are several ramifications of that:

• If there is a disagreement between the contractor and the insurer, the contractor may file a suit against the insurer in the policyholders’ name. The policyholder has no rights in the suit, and the suit could have an impact on future rates and insurability.
• The policyholder could be financially responsible to the contractor for the difference in the contractor’s price and the insurer’s payment.
• The policyholder could lose any ability to seek further action against the insurer because his/her rights have been assigned to the contractor.
• If a policyholder signed the agreement and then wishes to fire the contractor, that contractor still has claim to the insurance payment.

Armed Forces Insurance members do not need to sign an AOB to initiate repairs and should be very cautious of vendors who attend to pressure them or refuse work unless they sign a contract. Here’s how to avoid scammers:

• Beware of anyone who knocks on your door after a storm offering services.
• Avoid any vendor that wants you to relinquish insurance benefits.
• Get a written contract detailing the work that will be completed, the materials to be used, and the price for labor and materials.
• Get multiple repair bids for major damage.

Of course, if you have questions, please contact us at 800-255-0187.

Armed Forces Insurance: your trusted homeowner insurance advisor

Armed Forces Insurance has been a trusted advisor to American armed forces service members for more than 135 years. We’re not a giant corporate skyscraper full of slick insurance executives. We’re a small company headquartered just down the road from Fort Leavenworth in Kansas. We know each other, and our customers know us. If you’re looking for someone you can trust to shoot you straight and help you protect your home and property, check out our homeowner insurance page.

Learn more about home insurance:

Home insurance 101: What matters most and why

A Consumer’s Guide to Home Insurance (National Association of Insurance Commissioners)

Homeowners Insurance Basics (Insurance Information Institute)