Home Page Auto Home Flood Commercial Life Health



An alarming trend that can manipulate the legal concept of "assignment of benefit;" with homeowners caught in the middle.


A consumer discovers water damage. He or she calls a plumber who then recommends calling a water mitigation company.

The water mitigation contractor comes out, and puts a contract in the consumer's hands and will not start work until the work authorization or contract is signed.

Within the contract, there is an "assignment of benefits" (words to the effect of 'I transfer and assign any and all insurance rights, benefits, and causes of action under my property insurance policy') which the consumer may not fully understand. The use of "assignment of benefits" is legal, but most consumers do not fully understand what it means. It is now the water mitigation contractor who has all the rights to the claim, including all insurance proceeds and payments, resulting in many homeowners losing control of the process.


Typically, the insurance company learns of this type of claim after work has been performed. In many cases the water mitigation company charges an amount inconsistent with the amount of work performed. If the insurance company challenges the expenses submitted by the contractor, the contractor could - again, legally - file a contractor's lien which might ultimately allow for foreclosure on the consumer's home.

Don’t sign contracts you don’t fully understand. A water mitigation company should only require your customers to sign a work authorization form. Any contract that states “assignment of benefits” is something that needs to be read carefully and be fully understood. It could have very negative consequences.

Federated National Insurance and
Wiglesworth - Rindom Insurance Agency recommends using a reputable water mitigation company, Joe Taylor Restoration 888-814-1455. American Integrity recommends Rytech 800-865-8787 or DKI 888-735-0800.

When in doubt always give your insurance agent or adjuster a call before signing any insurance documents.

Share |

No Comments

Post a Comment
Required (Not Displayed)

All comments are moderated and stripped of HTML.
Submission Validation
Change the CAPTCHA codeSpeak the CAPTCHA code
Enter the Validation Code from above.
NOTICE: This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.
Blog Archive

View Mobile Version
Wiglesworth - Rindom Insurance Agency | 5300 W. Atlantic Ave; Suite 604 - Delray Beach, FL 33483 | 217 SW Akron Ave - Stuart, FL 34994 |
Phone: 561.637.2424
                              Powered by Insurance Website Builder
Home Page About Us Our Services Get A Quote Contact Us Testimonials