Should I Sign My Property Insurance Benefits to a Contractor?Posted December 5, 2017
As a policyholder who lives in the state of Oklahoma, you have very important legal rights. If your home or business has sustained significant damage, you should be able to get the money to make repairs for your covered losses, without any unreasonable delay. In some cases, the ability to sign your benefits over to a contractor (the assignment of benefits of AOB) can help make this process easier.
One of the biggest benefits of being able to assign your benefits is that you may be able to get immediate, emergency repairs without digging deep into your own pocket. Though, when assigning their benefits, property owners need to be careful. Here, our top-rated Oklahoma City bad faith insurance attorneys highlight three of the most important things home and business owners need to consider before entering into an assignment of benefits agreement.
Three Reasons Why Property Owners Need to Be Careful When Assigning Benefits
- You Could Lose Your Ability to Withhold Payments
When you hire a contractor or construction company to complete a project on your property, you have some ability to withhold payments to ensure that all of the work is completed to your satisfaction. However, once you enter into an assignment of benefits agreement, you may lose access to this tool. As such, you need to be sure that you have selected a reliable contractor before assigning benefits.
- It is Difficult to Switch Contractors
Likewise, once you have already agreed to an assignment of benefits contract, it is very difficult to switch contractors. You may end up being stuck working with a repair company, even if you are not fully satisfied with their performance on the job.
- You May Be On The Hook for the Any Financial Gaps
Finally, most contractors make property owners sign agreements that make them liable for any financial gaps after the insurance claim is fully processed. In other words, if your insurance company pays your contractor less than the full cost of your repairs, your contractor may come after you for a payment to fill the gap. Before signing this type of contract, please be sure that you fully understand your obligations.
Legal Advice is Available
If you are unsure of whether or not it makes sense to sign your benefits over to your contractor, you should consult with an experienced property insurance attorney. Your attorney will be able to help you understand your legal rights and your legal responsibilities. With full information in hand, you will better be able to make an informed decision on whether or not you wish to assign your benefits.
Contact Our Oklahoma Bad Faith Insurance Attorneys Today
At The Bennett Law Firm, our top-rated Oklahoma property insurance lawyers have extensive experience protecting the legal rights and financial interests of home and business owners. If your property insurance claim was denied, please do not hesitate to contact our team today. We represent policyholders in Oklahoma City and throughout the surrounding communities.