Windshield repair and Assignment of Benefits
There is an unsettling growing trend of consumers being approached by strangers at malls, gas stations, car washes and even over the phone offering to provide a windshield crack repair. They may even offer an incentive such as a $100 gift card in exchange for the consumer’s agreement to sign a contract called an Assignment of Benefits – AOB. Sometimes that business is honest and costs are fair and customary. But sometimes that isn’t the case. As with any other contract you might sign in your life, you should always be aware of exactly what you’re signing.
What is an Assignment of Benefits form?
An AOB is a contract. When you have a loss, you are never required to sign an AOB. Most policyholders will deal directly with their insurance company for the settlement of their claim. Sometimes a policyholder will enter into an AOB with a third party repair company allowing them to seek payment directly from the policyholder’s insurance company. But when signing, you are assigning your benefits under your insurance policy contract to the repair company. Your insurance carrier will only communicate with the repair company. You might lose your rights to mediation. And the repair company can sue your insurance company on your behalf without your knowledge.
Repairs are typically completed as discussed. However, the consumer isn’t aware that the business could submit a bill much higher than the customary cost associated with the repair. If the insurance company doesn’t pay the entire amount, the business may then sue the insurance company. This is happening at an alarming rate in states such as Florida. Sadly, the consumer originally approached doesn’t have any idea that the windshield repair business is suing their insurance company with their approval – based on the AOB they signed. Sometimes the AOB is signed with the traditional AOB form, other times the vendor has an unknowing consumer sign a blank tablet and the consumer’s signature is then transferred to legal documents.
Can you cancel Assignment of Benefits after signing?
In some states, such as Florida, a policyholder may cancel an AOB within days of signing and have no penalties or fees.
Contact your insurance agent
Remember, you can always contact your agent with any questions about coverage or needed repairs. Don’t be swayed by incentives to complete a glass repair, fix a windshield chip or other type of damages. While you are free to use the repairer of your choice, your agent can provide a list of glass repair shops who guarantee their work.
How do fraudulent insurance claims impact you?
The cost of car insurance fraud affects consumers with potential future rate increases. While we might typically associate this to dishonest policyholders turning in fraudulent claims, it also happens to unsuspecting insurance customers with increasing frequency when they sign an Assignment of Benefits with a business. Fraudulent claims not only drive up insurance costs, but they can also result in a policy being cancelled. And in the case of a windshield claim, the consumer could be at risk if a windshield isn’t properly installed.
If you are approached by a stranger offering to fix your windshield and then asked to sign an Assignment of Benefits, be careful.
- Verify there is glass damage that needs repair.
- Before you sign or accept anything, ask questions.
- Be sure to read the contract in its entirety.
- Consider talking with your agent before making any decisions.
- Before you sign, think it through one more time.
