I’m a Project Manager for a Water Restoration company. I’m fairly new with the company and have worked with the same role for another company in the past.
I wasn’t familiar with Assignment of Benefits (AOB) contracts at my previous job but my boss is really pushing the PM’s to sign customers to these contracts. It essentially means that the customer is signing over their rights to us and we as a restoration company make all the decisions regarding to the claim. We make the calls for what materials to remove and replace, how much equipment to set on the job, and anything else pertaining to Water Mitigation and Mold Remediation.
A big reason my boss is pushing these AOBs is because he says that if we sign them to those type of contracts we’ll get 1% of the policy limit under dwelling. So if the home is 300k we will get 3k and receive the funds much quicker than with a traditional contract.
These insurance company hate AOBs. When I mentioned to an adjuster on the phone the type of contract his response went something like “Oh man, are you serious?!? Why are you guys doing that.”
Lately my boss has been asking me to do things I’m not really comfortable with. He wanted me to go back the next day after I signed a job and get the customers to sign an AOB contract. Another instance, an insurance company sent an email saying it went against their policy for an insured to assign their rights to a contractor, essentially nullifying the AOB. He asked me to reach back out to the customer and see if they’ll sign the traditional contract and fill in the dates for the same time they originally signed back in February.
He’s also putting liens on houses like it’s nobody’s business. If the claim gets denied or the insurance doesn’t pay out our invoice to the amount we billed, LIEN. It’s happening way too often to customers that I put time and effort toward trying to be as professional as possible with. Two months later their house is getting a lien and I feel awful for them.
I have two main questions I’m trying to get answered.
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Is what my boss doing legal?
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Is it ethical to sign customers to AOB contracts?