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Assignment of benefits

Assignment of benefits is an agreement that gives your claims benefits to someone else.

What is an assignment of benefits?

An assignment of benefits (or AOB for short) is an agreement that gives your claims benefits, and in some instances complete control of your claim, to someone else. It’s usually used so that a contractor can "stand in your shoes" and file a claim, make decisions about repairs, and collect insurance payments from your insurance company directly for covered repairs. In some states, the contractor will even file a lawsuit against your insurer as your assignee.

Why do homeowners agree to an assignment of benefits?

Homeowners may sign an assignment of benefits form because they think it’s more convenient and efficient than dealing with the claims process firsthand.

Once a contractor has been assigned your benefits, they tell the insurance company what work they believe is required and negotiate the claim. For example, say you have a water leak in the house. You call a home restoration company to stop the water flow, clean up the mess, and restore your home to its former glory. The restoration company may ask for an assignment of benefits so it can deal directly with the insurance company without your input. That may sound like a relief at first glance – someone else can deal with all that!

But signing away your rights in the claims process may not be worth the risk.

Assignment of benefits in Florida: a case of rampant fraud

Because the assignment of benefits takes control out of the homeowner’s hands, insurance fraud is a major concern. Some contractors may take advantage of the situation and inflate repair needs and costs or bill for work that was never completed. They may also hire attorneys to sue the insurance company if it does not pay the full amount of their estimate or denies claims.

These lawsuits became a huge problem in Florida – by 2018, there were 135,000 AOB lawsuits , a 70 percent increase in 15 years. On the whole, the FBI estimates fraudulent claims account for nearly $6 billion of the $80 billion appropriated for post-hurricane reconstruction.

Florida eventually passed a bill in 2019 to curb the abuse of the assignment of benefits.

Ultimately, AOB fraud hurts homeowners the most. It increases homeowners insurance rates across the board, and you may be stuck with incomplete work and no recourse.

What responsibilities does the AOB contractor have?

Once you sign an AOB, a contractor has full power to make all decisions about the claim without consulting you. The assignment of benefits gives contractors the ability to:

File the insurance claim .
Work directly with insurance claims adjusters.
Make repair decisions.
Complete repairs.
Directly bill the insurance carrier for all work completed.
Sue your insurance company regarding your claim.

Sometimes the assignment of benefits limits the scope of the work the contractor was hired for. For example, say your home has a leaky pipe. You may hire a plumber to fix the leak, a remediation company to dry the walls and carpet, and a general contractor to replace the bathroom cabinets. Each of the three contractors may have a respective assignment of benefits for their part of the job.

How assignment of benefits impact homeowners

Under some circumstances, an assignment of benefits agreement could work out for homeowners who don’t want to handle their insurance claim. If the contractor is reputable, performs the work, and knows what information the insurance company needs, it can be a big help.

For example:

The claims adjuster will work directly with the contractor.
The contractor would handle remediation and repairs.
The contractor would bill the insurance company, not the homeowner.

AOB arrangements only work for covered damage in need of repair. If you must replace belongings or appliances, you’d still need to work directly with your insurer and payments would go to you.

Protecting yourself in an assignment of benefits agreement

Don’t sign an assignment of benefits agreement right off the bat. Before you hire any contractor:

Get multiple quotes.
Check references, licenses, and their insurance.
Get written estimates for potential work.
Get a guarantee to back the workmanship.
Make sure you get to approve the completed work.
Request copies of all paperwork sent to your insurance company.
Require that the contractor show you the documents you are actually signing.

You might be tempted to hire the first contractor you find, but you save yourself headaches if you do some due diligence before signing an assignment of benefits. Great contractors use this to expedite repairs and spare you some work. Take a beat to find that great contractor .

Assignment of Benefits for Contractors: Pros & Cons of Accepting an AOB

22 articles

Insurance , Restoration , Slow Payment

An illustrated assignment of benefits form in front of a damaged house

When a property owner files an insurance claim to cover a restoration or roofing project, the owner typically deals directly with the insurance company. They may not have the funds available to pay the contractor out of pocket, so they’re counting on that insurance check to cover the construction costs.

But insurance companies often drag their feet, and payments can take even longer than normal. Contractors often wish they could simply deal with the insurance company directly through an assignment of benefits. In some circumstances, an AOB can be an effective tool that helps contractors collect payment faster — but is it worth it?

In this article, we’ll explain what an assignment of benefits is, and how the process works. More importantly, we’ll look at the pros and cons for restoration and roofing contractors to help you decide if an AOB is worth it .

What is an assignment of benefits?

An assignment of benefits , or AOB, is an agreement to transfer insurance claim rights to a third party. It gives the assignee authority to file and negotiate a claim directly with the insurance company, without involvement from the property owner.

An AOB also allows the insurer to pay the contractor directly instead of funneling funds through the customer. AOBs take the homeowner out of the claims equation.

Here’s an example: A property owner’s roof is damaged in a hurricane. The owner contacts a restoration company to repair the damage, and signs an AOB to transfer their insurance rights to the contractor. The contractor, now the assignee, negotiates the claim directly with the insurance company. The insurer will pay the claim by issuing a check for the repairs directly to the restoration contractor.

Setting up an AOB

A property owner and contractor can set up an assignment of benefits in two steps:

The owner and the contractor sign an AOB agreement
The contractor sends the AOB to the insurance company

Keep in mind that many states have their own laws about what the agreement can or should include .

For example, Florida’s assignment of benefits law contains relatively strict requirements when it comes to an assignment of benefits:

The AOB agreements need to be in writing. The agreement must contain a bolded disclosure notifying the customer that they are relinquishing certain rights under the homeowners policy. You can’t charge administrative fees or penalties if a homeowner decides to cancel the AOB.
The AOB must include an itemized, per-unit breakdown of the work you plan to do. The services can only involve how you plan to make repairs or restore the home’s damage or protect the property from any further harm. A copy must be provided to the insurance company.
A homeowner can rescind an AOB agreement within 14 days of signing, or within 30 days if no work has begun and no start date was listed for the work. If a start date is listed, the 30-day rule still applies if substantial progress has not been made on the job.

Before signing an AOB agreement, make sure you understand the property owner’s insurance policy, and whether the project is likely to be covered.

Learn more: Navigating an insurance claim on a restoration project

Pros & cons for contractors

It’s smart to do a cost-benefit analysis on the practice of accepting AOBs. Listing pros and cons can help you make a logical assessment before deciding either way.

Pro: Hiring a public adjuster

An insurance carrier’s claims adjuster will inspect property damage and arrive at a dollar figure calculated to cover the cost of repairs. Often, you might feel this adjuster may have overlooked some details that should factor into the estimate.

If you encounter pushback from the insurer under these circumstances, a licensed, public adjuster may be warranted. These appraisers work for the homeowner, whose best interests you now represent as a result of the AOB. A public adjuster could help win the battle to complete the repairs properly.

Pro: More control over payment

You may sink a considerable amount of time into preparing an estimate for a customer. You may even get green-lighted to order materials and get started. Once the ball starts rolling, you wouldn’t want a customer to back out on the deal.

Klark Brown , Co-founder of The Alliance of Independent Restorers, concedes this might be one of the very situations in which an AOB construction agreement might help a contractor. “An AOB helps make sure the homeowner doesn’t take the insurance money and run,” says Brown.

Pro: Build a better relationship with the homeowner

A homeowner suffers a substantial loss and it’s easy to understand why push and pull with an insurance company might be the last thing they want to undertake. They may desire to have another party act on their behalf.

As an AOB recipient, the claims ball is now in your court. By taking some of the weight off a customer’s shoulders during a difficult period, it could help build good faith and further the relationship you strive to build with that client.

Learn more : 8 Ways for Contractors to Build Trust With a Homeowner

Con: It confuses payment responsibilities

Even if you accept an AOB, the property owner still generally bears responsibility for making payment. If the insurance company is dragging their feet, a restoration contractor can still likely file a mechanics lien on the property .

A homeowner may think that by signing away their right to an insurance claim, they are also signing away their responsibility to pay for the restoration work. This typically isn’t true, and this expectation could set you up for a more contentious dispute down the line if there is a problem with the insurance claim.

Con: Tighter margins

Insurance companies will want repairs made at the lowest cost possible. Just like you, carriers run a business and need to cut costs while boosting revenue.

While some restoration contractors work directly with insurers and could get a steady stream of work from them, Brown emphasizes that you may be sacrificing your own margins. “Expect to accept work for less money than you’d charge independently,” he adds.

The takeaway here suggests that any contractor accepting an AOB could subject themselves to the same bare-boned profit margins.

Con: More administrative work

Among others, creating additional administrative busywork is another reason Brown recommends that you steer clear of accepting AOBs. You’re committing additional resources while agreeing to work for less money.

“Administrative costs are a burden,” Brown states. Insurers may reduce and/or delay payments to help their own bottom lines. “Insurers will play the float with reserves and claims funds,” he added. So, AOBs can be detrimental to your business if you’re spending more while chasing payments.

Con: Increase in average collection period

Every contractor should use some financial metrics to help gauge the health of the business . The average collection period for receivables measures the average time it takes you to get paid on your open accounts.

Insurance companies aren’t known for paying claims quickly. If you do restoration work without accepting an AOB, you can often take action with the homeowner to get paid faster. When you’re depending on an insurance company to make your payment, rather than the owner, collection times will likely increase.

The literal and figurative bottom line is: If accepting assignment of benefits agreements increases the time it takes to get paid and costs you more in operational expense, these are both situations you want to avoid.

Learn more: How to calculate your collection effectiveness

AOBs and mechanics liens

A mechanics lien is hands down a contractor’s most effective tool to ensure they get paid for their work. Many types of restoration services are protected under lien laws in most states. But what happens to lien rights when a contractor accepts an assignment of benefits?

An AOB generally won’t affect a contractor’s ability to file a mechanics lien on the property if they don’t receive payment. The homeowner is typically still responsible to pay for the improvements. This is especially true if the contract involves work that wasn’t covered by the insurance policy.

However, make sure you know the laws in the state where your project is located. For example, Florida’s assignment of benefits law, perhaps the most restrictive in the country, appears to prohibit an AOB assignee from filing a lien.

Florida AOB agreements are required to include language that waives the contractor’s rights to collect payment from the owner. The required statement takes it even further, stating that neither the contractor or any of their subs can file a mechanics lien on the owner’s property.

On his website , Florida’s CFO says: “The third-party assignee and its subcontractors may not collect, or attempt to collect money from you, maintain any action of law against you, file a lien against your property or report you to a credit reporting agency.”

That sounds like a contractor assignee can’t file a lien if they aren’t paid . But, according to construction lawyer Alex Benarroche , it’s not so cut-and-dry.

“Florida’s AOB law has yet to be tested in court, and it’s possible that the no-lien provision would be invalid,” says Benarroche. “This is because Florida also prohibits no-lien clauses in a contract. It is not legal for a contractor to waive their right to file a lien via an agreement prior to performance.”

Learn more about no-lien clauses and their enforceability state-by-state

Remember that every state treats AOBs differently, and conflicting laws can create additional risk. It’s important to consult with a construction lawyer in the project’s state before accepting an assignment of benefits.

Best practices for contractors

At the end of the day, there are advantages and disadvantages to accepting an assignment of benefits. While it’s possible in some circumstances that an AOB could help a contractor get paid faster, there are lots of other payment tools that are more effective and require less administrative costs. An AOB should never be the first option on the table .

If you do decide to become an assignee to the property owner’s claim benefits, make sure you do your homework beforehand and adopt some best practices to effectively manage the assignment of benefits process. You’ll need to keep on top of the administrative details involved in drafting AOBs and schedule work in a timely manner to stay in compliance with the conditions of the agreement.

Make sure you understand all the nuances of how insurance works when there’s a claim . You need to understand the owner’s policy and what it covers. Home insurance policy forms are basically standardized for easy comparisons in each state, so what you see with one company is what you get with all carriers.

Since you’re now the point of contact for the insurance company, expect more phone calls and emails from both clients and the insurer . You’ll need to have a strategy to efficiently handle ramped-up communications since the frequency will increase. Keep homeowners and claims reps in the loop so you can build customer relationships and hopefully get paid faster by the insurer for your work.

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What is an assignment of benefits?

Three people in an office talking over a pile of papers.

The last time you sought medical care, you likely made an appointment with your provider, got the treatment you needed, paid your copay or deductible, and that was it. No paperwork, no waiting to be reimbursed; your doctor received payment from your insurance company and you both went on with your lives.

This is how most people receive health care in the U.S. This system, known as assignment of benefits or AOB, is now being used with other types of insurance, including auto and homeowners coverage .

What is an assignment of benefits?

An AOB is a legal agreement that allows your insurance company to directly pay a third party for services performed on your behalf. In the case of health care, it could be your doctor or another medical professional providing care. With a homeowners, renters, or auto insurance claim, the third party could be a contractor, auto repair shop, or other facility.

Assignment of benefits is legal, thanks to a concept known as freedom of contract, which says two parties may make a private agreement, including the forfeiture of certain rights, and the government may not interfere. There are exceptions, making freedom of contract something less than an absolute right. For example, the contract may not violate the law or contain unfair terms.

Not all doctors or contractors utilize AOBs. Therefore, it’s a good idea to make sure the doctor or service provider and you are on the same page when it comes to AOBs before treatment or work begins.

How an AOB works

The function of an AOB agreement varies depending on the type of insurance policy involved, the healthcare provider, contractor, or service provider, and increasingly, state law. Although an AOB is normal in health insurance, other applications of assignment of benefits have now included the auto and homeowners insurance industry.

Because AOBs are common in health care, you probably don’t think twice about signing a piece of paper that says “assignment of benefits” across the top. But once you sign it, you’re likely turning over your right to deal with your insurance company regarding service from that provider. Why would you do this?

According to Dr. David Berg of Redirect Health , the reason is simple: “Without an AOB in place, the patient themselves would be responsible for paying the cost of their service and would then file a claim with their insurance company for reimbursement.”

With homeowners or auto insurance, the same rules apply. Once you sign the AOB, you are effectively out of the picture. The contractor who reroofs your house or the mechanic who rebuilds your engine works with your insurance company by filing a claim on your behalf and receiving their money without your help or involvement.

“Each state has its own rules, regulations, and permissions regarding AOBs,” says Gregg Barrett, founder and CEO of WaterStreet , a cloud-based P&C insurance administration platform. “Some states require a strict written breakdown of work to be done, while others allow assignment of only parts of claims.”

Within the guidelines of the specific insurance rules for AOBs in your state, the general steps include:

You and your contractor draw up an AOB clause as part of the contract.
The contract stipulates the exact work that will be completed and all necessary details.
The contractor sends the completed AOB to the insurance company where an adjuster reviews, asks questions, and resolves any discrepancies.
The contractor’s name (or that of an agreed-upon party) is listed to go on the settlement check.

After work is complete and signed off, the insurer will issue the check and the claim will be considered settled.

Example of an assignment of benefits

If you’re dealing with insurance, how would an AOB factor in? Let’s take an example. “Say you have a water leak in the house,” says Angel Conlin, chief insurance officer at Kin Insurance . “You call a home restoration company to stop the water flow, clean up the mess, and restore your home to its former glory. The restoration company may ask for an assignment of benefits so it can deal directly with the insurance company without your input.”

In this case, by eliminating the homeowner, whose interests are already represented by an experienced insurance adjustor, the AOB reduces redundancy, saves time and money, and allows the restoration process to proceed with much greater efficiency.

When would you need to use an assignment of benefits?

An AOB can simplify complicated and costly insurance transactions and allow you to turn these transactions over to trusted experts, thereby avoiding time-consuming negotiations.

An AOB also frees you from paying the entire bill upfront and seeking reimbursement from your insurance company after work has been completed or services rendered. Since you are not required to sign an assignment of benefits, failure to sign will result in you paying the entire medical bill and filing for reimbursement. The three most common uses of AOBs are with health insurance, car insurance, and homeowners insurance.

Assignment of benefits for health insurance

As discussed, AOBs in health insurance are commonplace. If you have health insurance, you’ve probably signed AOBs for years. Each provider (doctor) or practice requires a separate AOB. From your point of view, the big advantages of an AOB are that you receive medical care, your doctor and insurance company work out the details and, in the event of a disagreement, those two entities deal with each other.

Assignment of benefits for car owners

If your car is damaged in an accident and needs extensive repair, the benefits of an AOB can quickly add up. Not only will you have your automobile repaired with minimal upfront costs to you, inconvenience will be almost nonexistent. You drop your car off (or have it towed), wait to be called, told the repair is finished, and pick it up. Similar to a health care AOB, disagreements are worked out between the provider and insurer. You are usually not involved.

Assignment of benefits for homeowners

When your home or belongings are damaged or destroyed, your primary concern is to “return to normal.” You want to do this with the least amount of hassle. An AOB allows you to transfer your rights to a third party, usually a contractor, freeing you to deal with the crisis at hand.

When you sign an AOB, your contractor can begin immediately working on damage repair, shoring up against additional deterioration, and coordinating with various subcontractors without waiting for clearance or communication with you.

The fraud factor

No legal agreement, including an AOB, is free from the possibility of abuse or fraud. Built-in safeguards are essential to ensure the benefits you assign to a third party are as protected as possible.

In terms of what can and does go wrong, the answer is: plenty. According to the National Association of Mutual Insurance Companies (NAMICs), examples of AOB fraud include inflated invoices or charges for work that hasn’t been done. Another common tactic is to sue the insurance company, without the policyholder’s knowledge or consent, something that can ultimately result in the policyholder being stuck with the bill and higher insurance premiums due to losses experienced by the insurer.

State legislatures have tried to protect consumers from AOB fraud and some progress has been made. Florida, for example, passed legislation in 2019 that gives consumers the right to rescind a fraudulent contract and requires that AOB contracts include an itemized description of the work to be done. Other states, including North Dakota, Kansas, and Iowa have all signed NAMIC-backed legislation into law to protect consumers from AOB fraud.

The National Association of Insurance Commissioners (NAIC), offers advice for consumers to help avoid AOB fraud and abuse:

File a claim with your insurer before you hire a contractor. This ensures you know what repairs need to be made.
Don’t pay in full upfront. Legitimate contractors do not require it.
Get three estimates before selecting a contractor.
Get a full written contract and read it carefully before signing.
Don’t be pressured into signing an AOB. You are not required to sign an AOB.

Pros and cons of an assignment of benefits

The advantages and disadvantages of an AOB agreement depend largely on the amount and type of protection your state’s insurance laws provide.

Pros of assignment of benefits

With proper safeguards in place to reduce opportunities for fraud, AOBs have the ability to streamline and simplify the insurance claims process.

An AOB frees you from paying for services and waiting for reimbursement from your insurer.
Some people appreciate not needing to negotiate with their insurer.
You are not required to sign an AOB.

Cons of assignment of benefits

As with most contracts, AOBs are a double-edged sword. Be aware of potential traps and ask questions if you are unsure.

Signing an AOB could make you the victim of a scam without knowing it until your insurer refuses to pay.
An AOB doesn’t free you from the ultimate responsibility to pay for services rendered, which could drag you into expensive litigation if things go south.
Any AOB you do sign is legally binding.

The takeaway

An AOB, as the health insurance example shows, can simplify complicated and costly insurance transactions and help consumers avoid time-consuming negotiations. And it can save upfront costs while letting experts work out the details.

It can also introduce a nightmare scenario laced with fraud requiring years of costly litigation. Universal state-level legislation with safeguards is required to avoid the latter. Until that is in place, your best bet is to work closely with your insurer when signing an AOB. Look for suspicious or inflated charges when negotiating with contractors, providers, and other servicers.

EDITORIAL DISCLOSURE : The advice, opinions, or rankings contained in this article are solely those of the Fortune Recommends ™ editorial team. This content has not been reviewed or endorsed by any of our affiliate partners or other third parties.

Home » Coverage Exclusions » Assignment of Benefits

Assignment of Benefits for Homeowners

How They Work
Using Your AOB
Pros & Cons
Safe & Secure
Watch Out for Abuse
Frequently Asked Questions

An assignment of benefits (AOB) is a contractual agreement that enables a third party to access insurance benefits on behalf of the policyholder.[1] When the policyholder signs an AOB agreement, it grants the third party the authority to initiate an insurance claim and receive reimbursement directly from the insurance company.

Assignment of benefits for homeowners means that any contractors , plumbers, or other professionals who perform work to repair your home or property after a claim will work with your insurance provider directly to get compensated. You step aside as the middleman, and they work together.

While AOB can work with most types of insurance, not every insurance company will allow it. The party performing the work (the insurance claimant) and your insurance company must both agree to the process.

As the policyholder, you must willingly sign an AOB agreement, giving explicit consent for a third party to access their insurance benefits.
AOBs make things easier for both you as the policyholder and for the service provider.
The service provider takes care of filing the claim, deciding on repairs, and getting paid by the insurance company, relieving you (the policyholder) of having to manage these details.

How Do Assignment of Benefits Work?

AOB is a straightforward process that simplifies insurance billing for both service providers and policyholders. Here is how an AOB works:

Coverage Approved

Before hiring a service provider, the policyholder must make sure that the service is covered by their policy by checking in with the insurance provider. In most medical situations, the billing staff will handle this on behalf of the patient, but in the cases of homeowners insurance, it may be necessary for the policyholder to manage this step.

Service Rendered

The policyholder, whether a patient or property owner, receives necessary services covered by their insurance policy, such as medical treatment or repairs.

Mutual Agreement

The policyholder and the service provider agree to utilize an AOB form.[2] This agreement authorizes the service provider to handle direct billing to the insurance company for the services provided.

Billing Submission

With the AOB form in place, the service provider submits all relevant documentation, including invoices and service records, to the insurance company for payment.

Claim Evaluation

The insurance company thoroughly reviews the submitted documents to verify that the provided services are indeed covered under the policy terms and that the contractor provided those same services.

Direct Payment

If the services are eligible and covered by the insurance policy, the insurance company promptly issues payment directly to the service provider. This payment aligns with the agreed-upon costs as outlined in the insurance policy.

Policyholder’s Responsibility

Generally, the policyholder is only responsible for any deductibles, copays, or out-of-pocket expenses specified in their insurance policy.[3] They are relieved of the responsibility of managing the billing process or handling reimbursement paperwork.

Example of an Assignment of Benefits

A hurricane hit Rachel’s town, severely damaging the shed where she keeps her tools and lawn equipment. The shed is covered under her home insurance policy, and she files a claim with the insurance provider quickly with photographs and documents that show the damage and provide proof of the value and potential cost to rebuild. The insurance provider approves the replacement of the shed.

To streamline the process of paying the contractor, Rachel signs an AOB allowing the contractor to bill the insurance provider rather than billing her. This means that if there are any disputes about the costs of materials, timeliness of payment, or any other issues, those will happen between the insurance company and the contractor, and Rachel will not be required to step in.

Additionally, rather than having to pay the contractor out of pocket and wait for a reimbursement check from the provider, the contractor will be paid directly by the insurance company, so Rachel doesn’t have to pay the cost of the shed replacement.

When Would You Use Your Assignment of Benefits?

AOBs can be useful in various situations:

Assign benefits to contractors for property damage repairs, simplifying the insurance claim process. It can often expedite the process and help claimants to get paid faster.
AOBs can help in emergencies, ensuring timely payment without paperwork hassles. This can be particularly helpful during already high-stress times.
Consider AOBs for complex claims with multiple providers or extensive paperwork. You’ll have less to manage if the parties work together directly.
You can use an AOB for a range of professionals that relate to a homeowners insurance claim, such as plumbers, roofers, window repair specialists, landscapers, carpenters, and restoration specialists.

Pros & Cons of Using Assignment of Benefits

Making sure your aob is safe & secure.

To ensure the safety of an AOB:

Check the reputation of the service provider and seek multiple quotes for services.[4]
Carefully examine the AOB terms, ensuring clarity and alignment with your insurance policy.
Beware of high-pressure tactics and take your time to decide.
Confirm the provider’s licensing and insurance.
Get multiple estimates in writing for the needed work.
Consult an attorney or insurance advisor if you have concerns.
Keep records of communication and contracts.
Inform your insurer about the AOB and their requirements.
After services, check the results against AOB terms and your satisfaction.

Assignment of Benefits Being Abused: What Are My Options?

While an AOB can offer convenience, the process may be susceptible to misuse by those who would take advantage of the insurance company and overcharge for services or claim to have provided services that they did not actually perform.

If you suspect AOB abuse, consider these options:

Contact Your Insurer

If you suspect AOB abuse, promptly reach out to your insurance company. Express your concerns and provide any evidence you have to support your concerns. Insurers have units dedicated to investigating potential fraud or AOB misuse.

Report Fraud

If you suspect fraudulent activities, report the issue to your state’s insurance fraud bureau or department, which investigates such cases and takes legal action when appropriate. However, fraud is generally difficult to prove.

Seek Legal Counsel

Get advice from an attorney who is experienced in insurance claims to navigate your specific situation. Be aware that pursuing legal action can be costly and lengthy, so it generally won’t be your first course of action. But if the process gets complicated, it’s helpful to have a legal professional on your side.

Know About Potential Litigation

If the contractor or service provider isn’t paid by your insurance company, they might pursue legal action against your provider, leading to a dispute that may require your action or response.

Frequently Asked Questions About Assignment of Benefits (AOB) for Homeowners

We have compiled some of the most frequently asked questions about AOBs and how to use them most effectively, so you can make the most informed decisions about your situation.

An assignment of benefits, also referred to as an AOB, in homeowners insurance is when you allow a contractor or service provider to take over your insurance claim process. They deal directly with the insurance company for tasks like repairs or damage assessments. This can simplify and expedite the process since the service provider is dealing directly with your insurance company without you serving as the intermediary.

All parties must agree to the process. As the policyholder, you’ll sign off on the process, and both the services provider and your insurance company must also agree to the process.

Using an AOB can be beneficial if it is used wisely and for the purposes of working with reputable service providers. It streamlines claims, but it also comes with potential risks like fraud. Proceed with caution and agree to an AOB only if you feel confident that you are working with trusted parties. Also, be aware that not all insurance companies allow AOBs. Consult your insurance provider to ensure they do before proceeding.

In recent years, AOBs have been the target of fraud. Some service providers have inflated their invoices, billing for work that wasn’t performed. In some cases, claimants sue the insurance company, resulting in higher premiums for the policyholder down the road.

An AOB simplifies the insurance claims process for policyholders, letting service providers handle the work of getting paid for their services. This reduces responsibility and stress for policyholders and can often serve the best interests of all parties.

An AOB on a claim form is a line item where you authorize a service provider to receive insurance benefits for a specific claim. It lets that provider directly bill and get paid by the insurance company, simplifying the process for you. Make sure to understand the terms before signing it.[2] In some cases, it could mean you are responsible for any fees billed by your service provider if your insurance company doesn’t pay the full amount.

The Do’s & Don’ts of Submitting a Homeowners Insurance Claim
How Long Will My Homeowners Insurance Claim Take?
How to File a Homeowners Insurance Claim
How to Document Property Damage for Your Claim
How to Speed Up Your Homeowners Insurance Claim
Insurance Claims & Appeals

Post Disaster Claims Guide . National Association of Insurance Commissioners.

Assignment of Benefits . Department of Health and Human Services – North Dakota.

Understanding Dental Assignment of Benefits . West Virginia Offices of the Insurance Commissioner.

Assignment of Benefits: Consumer Beware . (April 2020). National Association of Insurance Commissioners.

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Medicare Assignment: Everything You Need to Know

Medicare assignment.

Providers Accepting Assignment
Providers Who Do Not
Billing Options
Assignment of Benefits
How to Choose

Frequently Asked Questions

Medicare assignment is an agreement between Medicare and medical providers (doctors, hospitals, medical equipment suppliers, etc.) in which the provider agrees to accept Medicare’s fee schedule as payment in full when Medicare patients are treated.

This article will explain how Medicare assignment works, and what you need to know in order to ensure that you won’t receive unexpected bills.

fizkes / Getty Images

There are 35 million Americans who have Original Medicare. Medicare is a federal program and most medical providers throughout the country accept assignment with Medicare. As a result, these enrollees have a lot more options for medical providers than most of the rest of the population.

They can see any provider who accepts assignment, anywhere in the country. They can be assured that they will only have to pay their expected Medicare cost-sharing (deductible and coinsurance, some or all of which may be paid by a Medigap plan , Medicaid, or supplemental coverage provided by an employer or former employer).

It’s important to note here that the rules are different for the 29 million Americans who have Medicare Advantage plans. These beneficiaries cannot simply use any medical provider who accepts Medicare assignment.

Instead, each Medicare Advantage plan has its own network of providers —much like the health insurance plans that many Americans are accustomed to obtaining from employers or purchasing in the exchange/marketplace .

A provider who accepts assignment with Medicare may or may not be in-network with some or all of the Medicare Advantage plans that offer coverage in a given area. Some Medicare Advantage plans— health maintenance organizations (HMOs) , in particular—will only cover an enrollee’s claims if they use providers who are in the plan's network.

Other Medicare Advantage plans— preferred provider organizations (PPOs) , in particular—will cover out-of-network care but the enrollee will pay more than they would have paid had they seen an in-network provider.

Original Medicare

The bottom line is that Medicare assignment only determines provider accessibility and costs for people who have Original Medicare. People with Medicare Advantage need to understand their own plan’s provider network and coverage rules.

When discussing Medicare assignment and access to providers in this article, keep in mind that it is referring to people who have Original Medicare.

How to Make Sure Your Provider Accepts Assignment

Most doctors, hospitals, and other medical providers in the United States do accept Medicare assignment.

Provider Participation Stats

According to the Centers for Medicare and Medicaid Services, 98% of providers participate in Medicare, which means they accept assignment.

You can ask the provider directly about their participation with Medicare. But Medicare also has a tool that you can use to find participating doctors, hospitals, home health care services, and other providers.

There’s a filter on that tool labeled “Medicare-approved payment.” If you turn on that filter, you will only see providers who accept Medicare assignment. Under each provider’s information, it will say “Charges the Medicare-approved amount (so you pay less out-of-pocket).”

What If Your Provider Doesn’t Accept Assignment?

If your medical provider or equipment supplier doesn’t accept assignment, it means they haven’t agreed to accept Medicare’s approved amounts as payment in full for all of the services.

These providers can still choose to accept assignment on a case-by-case basis. But because they haven’t agreed to accept Medicare assignment for all services, they are considered nonparticipating providers.

Note that "nonparticipating" does not mean that a provider has opted out of Medicare altogether. Medicare will still pay claims for services received from a nonparticipating provider (i.e., one who does not accept Medicare assignment), whereas Medicare does not cover any of the cost of services obtained from a provider who has officially opted out of Medicare.

If a Medicare beneficiary uses a provider who has opted out of Medicare, that person will pay the provider directly and Medicare will not be involved in any way.

Physicians Who Have Opted Out

Only about 1% of all non-pediatric physicians have opted out of Medicare.

For providers who have not opted out of Medicare but who also don’t accept assignment, Medicare will still pay nearly as much as it would have paid if you had used a provider who accepts assignment. Here’s how it works:

Medicare will pay the provider 95% of the amount they would pay if the provider accepted assignment.
The provider can charge the person receiving care more than the Medicare-approved amount, but only up to 15% more (some states limit this further). This extra amount, which the patient has to pay out-of-pocket, is known as the limiting charge . But the 15% cap does not apply to medical equipment suppliers; if they do not accept assignment with Medicare, there is no limit on how much they can charge the person receiving care. This is why it’s particularly important to make sure that the supplier accepts Medicare assignment if you need medical equipment.
The nonparticipating provider may require the person receiving care to pay the entire bill up front and seek reimbursement from Medicare (using Form CMS 1490-S ). Alternatively, they may submit a claim to Medicare on behalf of the person receiving care (using Form CMS-1500 ).
A nonparticipating provider can choose to accept assignment on a case-by-case basis. They can indicate this on Form CMS-1500 in box 27. The vast majority of nonparticipating providers who bill Medicare choose to accept assignment for the claim being billed.
Nonparticipating providers do not have to bill your Medigap plan on your behalf.

Billing Options for Providers Who Accept Medicare

When a medical provider accepts assignment with Medicare, part of the agreement is that they will submit bills to Medicare on behalf of the person receiving care. So if you only see providers who accept assignment, you will never need to submit your own bills to Medicare for reimbursement.

If you have a Medigap plan that supplements your Original Medicare coverage, you should present the Medigap coverage information to the provider at the time of service. Medicare will forward the claim information to your Medigap insurer, reducing administrative work on your part.

Depending on the Medigap plan you have, the services that you receive, and the amount you’ve already spent in out-of-pocket costs, the Medigap plan may pay some or all of the out-of-pocket costs that you would otherwise have after Medicare pays its share.

(Note that if you have a type of Medigap plan called Medicare SELECT, you will have to stay within the plan’s network of providers in order to receive benefits. But this is not the case with other Medigap plans.)

After the claim is processed, you’ll be able to see details in your MyMedicare.gov account . Medicare will also send you a Medicare Summary Notice. This is Medicare’s version of an explanation of benefits (EOB) , which is sent out every three months.

If you have a Medigap plan, it should also send you an EOB or something similar, explaining the claim and whether the policy paid any part of it.

What Is Medicare Assignment of Benefits?

For Medicare beneficiaries, assignment of benefits means that the person receiving care agrees to allow a nonparticipating provider to bill Medicare directly (as opposed to having the person receiving care pay the bill up front and seek reimbursement from Medicare). Assignment of benefits is authorized by the person receiving care in Box 13 of Form CMS-1500 .

If the person receiving care refuses to assign benefits, Medicare can only reimburse the person receiving care instead of paying the nonparticipating provider directly.

Things to Consider Before Choosing a Provider

If you’re enrolled in Original Medicare, you have a wide range of options in terms of the providers you can use—far more than most other Americans. In most cases, your preferred doctor and other medical providers will accept assignment with Medicare, keeping your out-of-pocket costs lower than they would otherwise be, and reducing administrative hassle.

There may be circumstances, however, when the best option is a nonparticipating provider or even a provider who has opted out of Medicare altogether. If you choose one of these options, be sure you discuss the details with the provider before proceeding with the treatment.

You’ll want to understand how much is going to be billed and whether the provider will bill Medicare on your behalf if you agree to assign benefits (note that this is not possible if the provider has opted out of Medicare).

If you have supplemental coverage, you’ll also want to check with that plan to see whether it will still pick up some of the cost and, if so, how much you should expect to pay out of your own pocket.

A medical provider who accepts Medicare assignment is considered a participating provider. These providers have agreed to accept Medicare’s fee schedule as payment in full for services they provide to Medicare beneficiaries. Most doctors, hospitals, and other medical providers do accept Medicare assignment.

Nonparticipating providers are those who have not signed an agreement with Medicare to accept Medicare’s rates as payment in full. However, they can agree to accept assignment on a case-by-case basis, as long as they haven’t opted out of Medicare altogether. If they do not accept assignment, they can bill the patient up to 15% more than the Medicare-approved rate.

Providers who opt out of Medicare cannot bill Medicare and Medicare will not pay them or reimburse beneficiaries for their services. But there is no limit on how much they can bill for their services.

A Word From Verywell

It’s in your best interest to choose a provider who accepts Medicare assignment. This will keep your costs as low as possible, streamline the billing and claims process, and ensure that your Medigap plan picks up its share of the costs.

If you feel like you need help navigating the provider options or seeking care from a provider who doesn’t accept assignment, the Medicare State Health Insurance Assistance Program (SHIP) in your state may be able to help.

A doctor who does not accept Medicare assignment has not agreed to accept Medicare’s fee schedule as payment in full for their services. These doctors are considered nonparticipating with Medicare and can bill Medicare beneficiaries up to 15% more than the Medicare-approved amount.

They also have the option to accept assignment (i.e., accept Medicare’s rate as payment in full) on a case-by-case basis.

There are certain circumstances in which a provider is required by law to accept assignment. This includes situations in which the person receiving care has both Medicare and Medicaid. And it also applies to certain medical services, including lab tests, ambulance services, and drugs that are covered under Medicare Part B (as opposed to Part D).

In 2021, 98% of American physicians had participation agreements with Medicare, leaving only about 2% who did not accept assignment (either as a nonparticipating provider, or a provider who had opted out of Medicare altogether).

Accepting assignment is something that the medical provider does, whereas assignment of benefits is something that the patient (the Medicare beneficiary) does. To accept assignment means that the medical provider has agreed to accept Medicare’s approved fee as payment in full for services they provide.

Assignment of benefits means that the person receiving care agrees to allow a medical provider to bill Medicare directly, as opposed to having the person receiving care pay the provider and then seek reimbursement from Medicare.

Centers for Medicare and Medicaid Services. Medicare monthly enrollment .

Centers for Medicare and Medicaid Services. Annual Medicare participation announcement .

Centers for Medicare and Medicaid Services. Lower costs with assignment .

Centers for Medicare and Medicaid Services. Find providers who have opted out of Medicare .

Kaiser Family Foundation. How many physicians have opted-out of the Medicare program ?

Center for Medicare Advocacy. Durable medical equipment, prosthetics, orthotics, and supplies (DMEPOS) updates .

Centers for Medicare and Medicaid Services. Check the status of a claim .

Centers for Medicare and Medicaid Services. Medicare claims processing manual. Chapter 26 - completing and processing form CMS-1500 data set .

Centers for Medicare and Medicaid Services. Ambulance fee schedule .

Centers for Medicare and Medicaid Services. Prescription drugs (outpatient) .

By Louise Norris Norris is a licensed health insurance agent, book author, and freelance writer. She graduated magna cum laude from Colorado State University.

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Consumer Insight

Sept. 13, 2023

Assignment of Benefits: Consumer Beware

You've just survived a severe storm, or a tornado and you've experienced some extensive damage to your home that requires repairs, including the roof. Your contractor is now asking for your permission to speak with your insurance company using an Assignment of Benefits. Before you sign, read the fine print. Otherwise, you may inadvertently sign over your benefits and any extra money you’re owed as part of your claim settlement.

The National Association of Insurance Commissioners (NAIC) offers information to help you better understand insurance, your risk and what to do in the event you need repairs after significant storm damage.

Be cautious about signing an Assignment of Benefits. An Assignment of Benefits, or an AOB, is an agreement signed by a policyholder that allows a third party—such as a water extraction company, a roofer or a plumber—to act on behalf of the insured and seek direct payment from the insurance company. An AOB can be a useful tool for getting repairs done, as it allows the repair company to deal directly with your insurance company when negotiating repairs and issuing payment directly to the repair company. However, an AOB is a legal contract, so you need to understand what rights you are signing away and you need to be sure the repair company is trustworthy.

With an Assignment of Benefits, the third party, like a roofing company or plumber, files your claim, makes the repair decision and collects insurance payments without your involvement.
Once you have signed an AOB, the insurer only communicates with the third party and the other party can sue your insurer and you can lose your right to mediation.
It's possible the third party may demand a higher claim payment than the insurer offers and then sue the insurer when it denies your claim.
You are not required to sign an AOB to have repairs completed. You can file a claim directly with your insurance company, which allows you to maintain control of the rights and benefits provided by your policy in resolving the claim.

Be on alert for fraud. Home repair fraud is common after a natural disaster. Contractors often come into disaster-struck regions looking to make quick money by taking advantage of victims.

It is a good idea to do business with local or trusted companies. Ask friends and family for references.
Your insurer may also have recommendations or a list of preferred contractors.
Always get more than one bid on work projects. Your adjuster may want to review estimates before you make repairs.

Immediately after the disaster, have an accurate account of the damage for your insurance company when you file a claim.

Before removing any debris or belongings, document all losses.
Take photos or video and make a list of the damages and lost items.
Save damaged items if possible so your insurer can inspect them, some insurance companies may have this as a requirement in their policy.

Most insurance companies have a time requirement for reporting a claim, so contact your agent or company as soon as possible. Your state insurance department can help you find contact information for your insurance company, if you cannot find it.

Insurance company officials can help you determine what damages are covered, start your claim and even issue a check to start the recovery process.
When reporting losses, you will need insurance information, current contact information and a home inventory or list of damaged and lost property . If you do not have a list, the adjuster will give you some time to make one. Ask the adjuster how much time you have to submit this inventory list. The NAIC Post Disaster Claims Guide has details on what you can do if you do not have a home inventory list.

After you report damage to your insurance company, they will send a claims adjuster to assess the damage at no cost to you . An adjuster from your insurance company will walk through and around your home to inspect damaged items and temporary repairs you may have made.

A public adjuster is different from an adjuster from your insurance company and has no ties to the insurance company.
They estimate the damage to your home and property, review your insurance coverage, and negotiate a settlement of the insurance claim for you.
Many states require public adjusters to be licensed. Some states prohibit public adjusters from negotiating insurance claims for you. In those states, only a licensed attorney can represent you.
You have to pay a public adjuster.
The NAIC Post Disaster Claims Guide has information on the different types of adjusters.

Once the adjuster has completed an assessment, they will provide documentation of the loss to your insurer to determine your claims settlement. When it comes to getting paid, you may receive more than one check. If the damage is severe or you are displaced from your home, the first check may be an emergency advance. Other payments may be for the contents of your home, other personal property, and structural damages. Please note that if there is a mortgage on your home, the payment for structural damage may be payable to you and your mortgage lender. Lenders may put that money into an escrow account and pay for repairs as the work is completed.

More information. States have rules governing how insurance companies handle claims. If you think that your insurer is not responding in a timely manner or completing a reasonable investigation of your claim, contact your state insurance department .

About the National Association of Insurance Commissioners

As part of our state-based system of insurance regulation in the United States, the National Association of Insurance Commissioners (NAIC) provides expertise, data, and analysis for insurance commissioners to effectively regulate the industry and protect consumers. The U.S. standard-setting organization is governed by the chief insurance regulators from the 50 states, the District of Columbia and five U.S. territories. Through the NAIC, state insurance regulators establish standards and best practices, conduct peer reviews, and coordinate regulatory oversight. NAIC staff supports these efforts and represents the collective views of state regulators domestically and internationally.

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What is an assignment of benefits.

This is how most people receive health care in the U.S. This system, known as assignment of benefits or AOB, is now being used with other types of insurance, including auto and homeowners coverage .

How an AOB works

Because AOBs are common in health care, you probably don’t think twice about signing a piece of paper that says "assignment of benefits" across the top. But once you sign it, you’re likely turning over your right to deal with your insurance company regarding service from that provider. Why would you do this?

According to Dr. David Berg of Redirect Health, the reason is simple: “Without an AOB in place, the patient themselves would be responsible for paying the cost of their service and would then file a claim with their insurance company for reimbursement.”

Within the guidelines of the specific insurance rules for AOBs in your state, the general steps include:

You and your contractor draw up an AOB clause as part of the contract.

The contract stipulates the exact work that will be completed and all necessary details.

The contractor sends the completed AOB to the insurance company where an adjuster reviews, asks questions, and resolves any discrepancies.

The contractor’s name (or that of an agreed-upon party) is listed to go on the settlement check.

After work is complete and signed off, the insurer will issue the check and the claim will be considered settled.

Example of an assignment of benefits

When would you need to use an assignment of benefits?

An AOB can simplify complicated and costly insurance transactions and allow you to turn these transactions over to trusted experts, thereby avoiding time-consuming negotiations.

Assignment of benefits for health insurance

Assignment of benefits for car owners

Assignment of benefits for homeowners

The fraud factor

The National Association of Insurance Commissioners (NAIC), offers advice for consumers to help avoid AOB fraud and abuse:

File a claim with your insurer before you hire a contractor. This ensures you know what repairs need to be made.

Don’t pay in full upfront. Legitimate contractors do not require it.

Get three estimates before selecting a contractor.

Get a full written contract and read it carefully before signing.

Don’t be pressured into signing an AOB. You are not required to sign an AOB.

Pros and cons of an assignment of benefits

The advantages and disadvantages of an AOB agreement depend largely on the amount and type of protection your state’s insurance laws provide.

Pros of assignment of benefits

With proper safeguards in place to reduce opportunities for fraud, AOBs have the ability to streamline and simplify the insurance claims process.

An AOB frees you from paying for services and waiting for reimbursement from your insurer.

Some people appreciate not needing to negotiate with their insurer.

You are not required to sign an AOB.

Cons of assignment of benefits

As with most contracts, AOBs are a double-edged sword. Be aware of potential traps and ask questions if you are unsure.

Signing an AOB could make you the victim of a scam without knowing it until your insurer refuses to pay.

An AOB doesn’t free you from the ultimate responsibility to pay for services rendered, which could drag you into expensive litigation if things go south.

Any AOB you do sign is legally binding.

The takeaway

This story was originally featured on Fortune.com

Practice Areas

Assignment of benefits: what you need to know.

August 17, 2022
Steven Schwartzapfel

Insurance can be useful, but dealing with the back-and-forth between insurance companies and contractors, medical specialists, and others can be a time-consuming and ultimately unpleasant experience. You want your medical bills to be paid without having to act as a middleman between your healthcare provider and your insurer.

However, there’s a way you can streamline this process. With an assignment of benefits, you can designate your healthcare provider or any other insurance payout recipient as the go-to party for insurance claims. While this can be convenient, there are certain risks to keep in mind as well.

Below, we’ll explore what an assignment of insurance benefits is (as well as other forms of remediation), how it works, and when you should employ it. For more information, or to learn whether you may have a claim against an insurer, contact Schwartzapfel Lawyers now at 1-516-342-2200 .

What Is an Assignment of Benefits?

An assignment of benefits (AOB) is a legal process through which an insured individual or party signs paperwork that designates another party like a contractor, company, or healthcare provider as their insurance claimant .

Suppose you’re injured in a car accident and need to file a claim with your health insurance company for medical bills and related costs. However, you also need plenty of time to recover. The thought of constantly negotiating between your insurance company, your healthcare provider, and anyone else seems draining and unwelcome.

With an assignment of benefits, you can designate your healthcare provider as your insurance claimant. Then, your healthcare provider can request insurance payouts from your healthcare insurance provider directly.

Through this system, the health insurance provider directly pays your physician or hospital rather than paying you. This means you don’t have to pay your healthcare provider. It’s a streamlined, straightforward way to make sure insurance money gets where it needs to go. It also saves you time and prevents you from having to think about insurance payments unless absolutely necessary.

What Does an Assignment of Benefits Mean?

An AOB means that you designate another party as your insurance claimant. In the above example, that’s your healthcare provider, which could be a physician, hospital, or other organization.

With the assignment of insurance coverage, that healthcare provider can then make a claim for insurance payments directly to your insurance company. The insurance company then pays your healthcare provider directly, and you’re removed as the middleman.

As a bonus, this system sometimes cuts down on your overall costs by eliminating certain service fees. Since there’s only one transaction — the transaction between your healthcare provider and your health insurer — there’s only one set of service fees to contend with. You don’t have to deal with two sets of service fees from first receiving money from your insurance provider, then sending that money to your healthcare provider.

Ultimately, the point of an assignment of benefits is to make things easier for you, your insurer, and anyone else involved in the process.

What Types of Insurance Qualify for an Assignment of Benefits?

Most types of commonly held insurance can work with an assignment of benefits. These insurance types include car insurance, healthcare insurance, homeowners insurance, property insurance, and more.

Note that not all insurance companies allow you to use an assignment of benefits. For an assignment of benefits to work, the potential insurance claimant and the insurance company in question must each sign the paperwork and agree to the arrangement. This prevents fraud (to some extent) and ensures that every party goes into the arrangement with clear expectations.

If your insurance company does not accept assignments of benefits, you’ll have to take care of insurance payments the traditional way. There are many reasons why an insurance company may not accept an assignment of benefits.

To speak with a Schwartzapfel Lawyers expert about this directly, call 1-516-342-2200 for a free consultation today. It will be our privilege to assist you with all your legal questions, needs, and recovery efforts.

Who Uses Assignments of Benefits?

Many providers, services, and contractors use assignments of benefits. It’s often in their interests to accept an assignment of benefits since they can get paid for their work more quickly and make critical decisions without having to consult the insurance policyholder first.

Imagine a circumstance in which a homeowner wants a contractor to add a new room to their property. The contractor knows that the scale of the project could increase or shrink depending on the specifics of the job, the weather, and other factors.

If the homeowner uses an assignment of benefits to give the contractor rights to make insurance claims for the project, that contractor can then:

Bill the insurer directly for their work. This is beneficial since it ensures that the contractor’s employees get paid promptly and they can purchase the supplies they need.
Make important decisions to ensure that the project completes on time. For example, a contract can authorize another insurance claim for extra supplies without consulting with the homeowner beforehand, saving time and potentially money in the process.

Practically any company or organization that receives payments from insurance companies may choose to take advantage of an assignment of benefits with you. Example companies and providers include:

Ambulance services
Drug and biological companies
Lab diagnostic services
Hospitals and medical centers like clinics
Certified medical professionals such as nurse anesthetists, nurse midwives, clinical psychologists, and others
Ambulatory surgical center services
Permanent repair and improvement contractors like carpenters, plumbers, roofers, restoration companies, and others
Auto repair shops and mechanic organizations

Advantages of Using an Assignment of Benefits

An assignment of benefits can be an advantageous contract to employ, especially if you believe that you’ll need to pay a contractor, healthcare provider, and/or other organization via insurance payouts regularly for the near future.

These benefits include but are not limited to:

Save time for yourself. Again, imagine a circumstance in which you are hospitalized and have to pay your healthcare provider through your health insurance payouts. If you use an assignment of benefits, you don’t have to make the payments personally or oversee the insurance payouts. Instead, you can focus on resting and recovering.
Possibly save yourself money in the long run. As noted above, an assignment of benefits can help you circumvent some service fees by limiting the number of transactions or money transfers required to ensure everyone is paid on time.
Increased peace of mind. Many people don’t like having to constantly think about insurance payouts, contacting their insurance company, or negotiating between insurers and contractors/providers. With an assignment of benefits, you can let your insurance company and a contractor or provider work things out between them, though this can lead to applications later down the road.

Because of these benefits, many recovering individuals, car accident victims, homeowners, and others utilize AOB agreements from time to time.

Risks of Using an Assignment of Benefits

Worth mentioning, too, is that an assignment of benefits does carry certain risks you should be aware of before presenting this contract to your insurance company or a contractor or provider. Remember, an assignment of benefits is a legally binding contract unless it is otherwise dissolved (which is technically possible).

The risks of using an assignment of benefits include:

You give billing control to your healthcare provider, contractor, or another party. This allows them to bill your insurance company for charges that you might not find necessary. For example, a home improvement contractor might bill a homeowner’s insurance company for an unnecessary material or improvement. The homeowner only finds out after the fact and after all the money has been paid, resulting in a higher premium for their insurance policy or more fees than they expected.
You allow a contractor or service provider to sue your insurance company if the insurer does not want to pay for a certain service or bill. This can happen if the insurance company and contractor or service provider disagree on one or another billable item. Then, you may be dragged into litigation or arbitration you did not agree to in the first place.
You may lose track of what your insurance company pays for various services . As such, you could be surprised if your health insurance or other insurance premiums and deductibles increase suddenly.

Given these disadvantages, it’s still wise to keep track of insurance payments even if you choose to use an assignment of benefits. For example, you might request that your insurance company keep you up to date on all billable items a contractor or service provider charges for the duration of your treatment or project.

For more on this and related topic, call Schwartzapfel Lawyers now at 1-516-342-2200 .

How To Make Sure an Assignment of Benefits Is Safe

Even though AOBs do carry potential disadvantages, there are ways to make sure that your chosen contract is safe and legally airtight. First, it’s generally a wise idea to contact knowledgeable legal representatives so they can look over your paperwork and ensure that any given assignment of benefits doesn’t contain any loopholes that could be exploited by a service provider or contractor.

The right lawyer can also make sure that an assignment of benefits is legally binding for your insurance provider. To make sure an assignment of benefits is safe, you should perform the following steps:

Always check for reviews and references before hiring a contractor or service provider, especially if you plan to use an AOB ahead of time. For example, you should stay away if a contractor has a reputation for abusing insurance claims.
Always get several estimates for work, repairs, or bills. Then, you can compare the estimated bills and see whether one contractor or service provider is likely to be honest about their charges.
Get all estimates, payment schedules, and project schedules in writing so you can refer back to them later on.
Don’t let a service provider or contractor pressure you into hiring them for any reason . If they seem overly excited about getting started, they could be trying to rush things along or get you to sign an AOB so that they can start issuing charges to your insurance company.
Read your assignment of benefits contract fully. Make sure that there aren’t any legal loopholes that a contractor or service provider can take advantage of. An experienced lawyer can help you draft and sign a beneficial AOB contract.

Can You Sue a Party for Abusing an Assignment of Benefits?

Sometimes. If you believe your assignment of benefits is being abused by a contractor or service provider, you may be able to sue them for breaching your contract or even AOB fraud. However, successfully suing for insurance fraud of any kind is often difficult.

Also, you should remember that a contractor or service provider can sue your insurance company if the insurance carrier decides not to pay them. For example, if your insurer decides that a service provider is engaging in billing scams and no longer wishes to make payouts, this could put you in legal hot water.

If you’re not sure whether you have grounds for a lawsuit, contact Schwartzapfel Lawyers today at 1-516-342-2200 . At no charge, we’ll examine the details of your case and provide you with a consultation. Don’t wait. Call now!

Assignment of Benefits FAQs

Which states allow assignments of benefits.

Every state allows you to offer an assignment of benefits to a contractor and/or insurance company. That means, whether you live in New York, Florida, Arizona, California, or some other state, you can rest assured that AOBs are viable tools to streamline the insurance payout process.

Can You Revoke an Assignment of Benefits?

Yes. There may come a time when you need to revoke an assignment of benefits. This may be because you no longer want the provider or contractor to have control over your insurance claims, or because you want to switch providers/contractors.

To revoke an assignment of benefits agreement, you must notify the assignee (i.e., the new insurance claimant). A legally solid assignment of benefits contract should also include terms and rules for this decision. Once more, it’s usually a wise idea to have an experienced lawyer look over an assignment of benefits contract to make sure you don’t miss these by accident.

Contact Schwartzapfel Lawyers Today

An assignment of benefits is an invaluable tool when you need to streamline the insurance claims process. For example, you can designate your healthcare provider as your primary claimant with an assignment of benefits, allowing them to charge your insurance company directly for healthcare costs.

However, there are also risks associated with an assignment of benefits. If you believe a contractor or healthcare provider is charging your insurance company unfairly, you may need legal representatives. Schwartzapfel Lawyers can help.

As knowledgeable New York attorneys who are well-versed in New York insurance law, we’re ready to assist with any and all litigation needs. For a free case evaluation and consultation, contact Schwartzapfel Lawyers today at 1-516-342-2200 !

Schwartzapfel Lawyers, P.C. | Fighting For You™™

What Is an Insurance Claim? | Experian

What is assignment of benefits, and how does it impact insurers? | Insurance Business Mag

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Assignment of Benefits vs Direction to Pay vs Assignment of Policy

Assignment of Benefits vs. Assignment of Policy

Assignment of Benefits forms, also known as AOBs, play a crucial role in the restoration industry’s contractor-client dynamics. These legal documents empower policyholders to transfer their insurance policy benefits to a third party, effectively connecting their restoration contractor directly to their insurance company. By doing so, policyholders can bypass many of the complications and anxieties typically associated with a restoration project, streamlining the process.

According to Josh Ehmke, Co-owner and General Consult at One Claim Solution , there’s a common misunderstanding between assignment of benefits and assignment of policy. An assignment of policy refers to the transfer of the benefits and rights of an insurance policy from one party (the policyholder) to another party (the assignee).

“An assignment of policy is never going to be valid. In fact, I haven’t come across a state that allows an assignment of an insurance policy without the insurance company’s prior written consent,” Josh said. “The reason it’s not allowed is because it’s against public policy. It increases the insurance risk substantially.”

For example, a policyholder might have a history of filing numerous claims against their insurance provider, suggesting a pattern that they might be well-versed in exploiting certain loopholes and taking advantage of insurance companies. Additionally, there are concerns that they may not adequately maintain or safeguard their property, leading to an increased risk for the insurance company.

“That is absolutely different from an assignment of benefits, which grants the rights the policyholder had to the payment under the policy to be transferred to the assignee,” Josh said. ”The only prerequisite for an assignment of benefits other than having a covered claim, is that the loss has already occurred. If you get an assignment of benefits before the loss occurs, that’s essentially a transfer of a policy.”

OCS recently encountered a case where the question arose regarding the scope of an assignment of benefits. Specifically, the issue was whether only the rights of the policyholder are transferred, or if the policyholder’s obligations are also transferred alongside the benefits under the assignment.

“By taking the assignment, the contractor doesn’t assume the policyholder’s obligations under that policy,” Josh said. “It’s very important to word your assignment of benefits appropriately to clearly state that you’re not agreeing to assume any of those policy obligations, and to specify which rights you want.”

Direction to Pay vs. Assignment of Benefits

Direction to pay (DTP) is a financial arrangement where the policyholder, who is entitled to receive an insurance claim payment, instructs the insurance company to pay the claim proceeds directly to a third party. This third party could be a vendor, contractor, service provider, or any other entity to whom the policyholder owes a debt or has entered into an agreement.

“The issue with direction to pay is that the carrier doesn’t have to honor it because it’s not enforceable,” Josh said. “It’s very limited in what it can do, whereas an assignment of benefits is much more powerful because it obligates the insurance company legally to pay you.”

According to Josh, DTP’s are rarely used, except in states like Texas and Florida where AOBs are detrimental to contractors or illegal.

“A DTP is better than nothing and allows you to at least show the carrier that the homeowner granted approval to request payment,” Josh said. “But outside of those situations, the direction to pay in my mind is worthless. When you can have an assignment of benefits, there’s no reason to have a direction to pay at all.”

A Final Word

Understanding the differences between an AOB, Assignment of Policy, and DTP is crucial because each term represents distinct legal and financial arrangements that can significantly impact insurance claims and policyholder rights. To learn more about the value of assignment of benefits in helping you navigate the restoration process, be sure to subscribe to our newsletter .

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Connor Trahan

Account executive.

Hi there! I’m Connor, the Account Executive for One Claim. My goal is to guide our contractors through the sales process, ensuring you’re equipped with all the information you need to make your decision and hit the ground running once aboard. We view ourselves as an extension of your business and I strive to make the process an enlightening and consultative one. My career has primarily been focused in software sales over a few different industries but the last few years were spent helping general contractors solve similar problems to what we’re doing here at OCS! Outside of work, I love spending time with my family, cooking and boating during the summer months.

Nicole Liesenfelt

Director, human resources.

Hello! I’m Nicole, and I’m here to champion for our employees, recruit for new talent, and impact culture at One Claim Solution. I find satisfaction in supporting a memorable employee experience and bring innovation, problem solving, and strategic view to the process. Nothing is more important than our people, and a healthy culture is my top priority! I have had the pleasure of building my career in various sectors, specializing in small to medium size firms focused on high-growth. My experience is centered around driving and implementing change, leading high-performing teams, and driving process improvements. I am excited to make an impact at One Claim. Outside of work, my family and I enjoy getting outdoors as much as possible to explore beautiful Colorado!

Elizabeth McGlone

Demand generation manager.

Great to meet you! I’m Elizabeth, and I’m the one behind all the emails and advertisements you’ve been seeing. As the Demand Generation Manager at One Claim Solution, my mission is to connect with contractors like you who need our services. I’m passionate about having an impact on others and I bring a wealth of experience in demand generation and marketing strategy to create moments of delight, curiosity, and education for you.

Prior to One Claim Solution, I had the privilege of building marketing departments from the ground up at companies in a variety of industries, including IT consulting, first protection, and healthcare. Personally, I love being outdoors, playing Dungeons and Dragons and board games, singing, and traveling.

Alisha Yartzoff

Director of contractor success.

Welcome! I’m Alisha, and I’m here to champion your success as the Director of Contractor Success at One Claim. With a passion for helping contractors thrive, I bring a wealth of experience in onboarding, customer service, and account management to ensure your journey with us is nothing short of exceptional.

Prior to joining One Claim, I had the privilege of scaling SMB and Enterprise Customer Success teams at fast-growing SaaS startups. With over six years of experience at companies like Mavenlink, Teamwork, and ServiceTitan, I honed my expertise in building high-performing teams and fostering proactive, consultative relationships. This background has equipped me with a deep understanding of the challenges faced by businesses like yours, and I’m dedicated to helping you overcome them.

Hi there, my name is Eric! I am the Chief Technology Officer here at OCS, spearheading our technical strategy. I have a background in computer science, graduating cum laude from BYU-Idaho with a Bachelor’s degree in Computer Information Technology.

Before coming to One Claim, I served as the Director of Engineering at Slingshot Technology, Inc., a company later acquired by WorkWave in 2021. My professional journey has spanned both emerging startups and established corporations, with a steadfast focus on cultivating high-trust, low bureaucracy teams and innovating technology using agile methodologies.

In my free time, you can find me flying drones, enjoying the outdoors, and spending time with my family.

Hello, my name is Cam, I’m the COO of One Claim Solution! I come from a management consulting background (Bain & Company) and hold an MBA from the University of Michigan. I have worked at a wide variety of organizations, from Fortune 500 to small-cap, in an equally wide variety of industries. I have over 15 years of experience in operations and strategic growth, and I have spent much of my career focused on developing high-performing tech-enabled service organizations through early stage and high growth phases.

Outside of work, my wife Brittny and I have four kids, ages 13 to 6. As residents of Mesa, Arizona, we love to ski and explore the national parks of the southwest!

Hello, my name is Dan, and I am the CEO of One Claim Solution. I am super excited by everything we are doing at OCS to be the market leading insurance billing specialist that advocates on behalf of our restoration contractors.

My professional experiences are predominantly corporate in nature. My career started at General Electric in finance and accounting. Immediately prior to joining OCS, I spent time as an investor at Bondcliff Partners and management consultant with Bain & Company. I also hold an MBA from the Kellogg School of Management at Northwestern University and got my BS in finance and accounting from Northeastern University.

Outside of the office, I enjoy spending time with my wife, two young children, and our family dog, Whiskey. We live in Charleston, SC and take advantage of the beautiful weather by spending as much time as possible outside at the beach or adventuring around town

Co-Founder and General Counsel

Hi, I’m Josh! In 2016, I co-founded One Claim Solution with my partner Jeremy Traasdahl, and I serve as General Counsel of One Claim Solution. Working in the restoration industry, Jeremy and I saw contractors struggling to get paid quickly and fairly and we knew there was a need for change. We founded One Claim Solution to be this change and it’s been my privilege to see our company grow and to advocate for our clients as general counsel.

Outside of my passion for helping the restoration industry, I enjoy spending time outdoors, fly-fishing, hunting, skiing, and coaching my kids’ baseball teams. I’ve been married to my amazing wife for 20 years and we have a beautiful family of 5 children.

Jeremy Traasdahl

Hey, I’m Jeremy! In 2016, I co-founded One Claim Solution with my partner Josh Ehmke. Working in the restoration industry, Josh and I saw contractors struggling to get paid quickly and fairly and we knew there was a need for change. We founded One Claim Solution to be this change and it’s been my privilege to lead our amazing team.

Prior to One Claim Solution, I started my career as an inside sales rep for Avnet, then moved to Pepsico as a district sales manager. Outside of work, I love spending time with my wife and four children, two boys and two girls!

The Florida Contractor’s Guide to AOBs: Laws, Requirements, and FAQs

In Florida, the use of an assignment of benefits (AOB) has become increasingly popular as a means of streamlining property insurance claims. They also have come under fire from insurance carriers, and as part of the recent sweeping property insurance reforms in Florida, the Florida legislature banned the future use of AOBs in property claims. But they’re not gone yet — at least for insurance policies issued before 2023.

But even for those pre-2023 policies, Florida law extensively regulates the use of AOBs. Whether you’re a roofer, restoration pro, or general contractor, you need to know about these rules and regulations if you want to legally use an AOB in Florida. The cost of violating these rules is high, often meaning the AOB is void and entirely unenforceable! So read on to make sure you comply with Florida AOB law.

Table of Contents

How Recent Property Insurance Reforms in Florida Affect AOBs

In December 2022, the Florida legislature enacted Senate Bill 2-A, a game-changing law that transformed the property insurance landscape in Florida. Among other major changes to Florida property insurance and claims, SB 2-A effectively outlawed the future use of assignment of benefits in property insurance claims. Under the new reforms, any homeowner’s insurance policy or commercial property insurance policy that issued on or after January 1, 2023 is not eligible for an AOB.

In other words, due to the 2022 Florida property insurance reforms, neither homeowners nor business property owners can enter an AOB if their insurance policy issued on or after January 1, 2023 .

Is an Assignment of Benefits Enforceable under Florida Law?

Maybe. The answer depends on whether the underlying policy issued before January 1, 2023, and whether the assignment of benefits complies with all the requirements of Section 627.7152, Florida Statues. If the answer to either of those questions is no, then the AOB is not enforceable for property claims in Florida.

Requirements for an Enforceable AOB in Florida

The issue of whether an AOB in Florida is enforceable is complicated. To make the issue more understandable, we’ve broken it down in the sections below.

The Underlying Policy Must Have Issued Before January 1, 2023

As we’ve said already, the threshold question for whether an AOB is enforceable in Florida is when the applicable policy issued. If the policy issued on or after January 1, 2023, that’s the end of the story — any AOB based on that policy is unenforceable, full stop.

The AOB contract must meet the requirements of Section 627.7152(2), Florida Statutes.

If the insurance policy issued before 2023, then the AOB still must comply with the rest of Section 627.7152, Florida Statutes. In particular, under Section 627.7152(2)(a), an assignment of benefits is not enforceable in Florida unless the AOB contract meets all of the following requirements:

The AOB contract must be in writing and signed by both parties.

Florida law requires that an AOB contract “[b]e in writing and executed by and between the assignor and the assignee.” Section 627.7152(2)(a)(2), Florida Statutes .

This one is straightforward: An AOB isn’t enforceable in Florida unless both your company and the policyholder sign a written AOB contract.

The AOB contract must explicitly allow the policyholder to rescind the AOB without penalty within certain periods

Florida law requires that an AOB contract “[c]ontain a provision that allows the assignor to rescind the assignment agreement without a penalty or fee by submitting a written notice of rescission signed by the assignor to the assignee within 14 days after the execution of the agreement, at least 30 days after the date work on the property is scheduled to commence if the assignee has not substantially performed, or at least 30 days after the execution of the agreement if the agreement does not contain a commencement date and the assignee has not begun substantial work on the property.” Section 627.7152(2)(a)(3), Florida Statutes .

Don’t forget, this provision doesn’t just give a policyholder rights to rescind an AOB within the time periods stated above — it requires that the AOB contract actually contain the statutory language giving the policyholder those rights.

Also, the AOB contract needs to include all of this statutory language. At least one court has suggested that if even part of this language is missing, then the AOB does not meet the requirements of Section 627.7152, Florida Statues, and is therefore invalid and unenforceable. JPJ Servs. LLC v. New Hampshire Ins. Co. , No. 21-14329-CIV, (S.D. Fla. June 3, 2022) .

The AOB contract must explicitly require you to notify the insurance company about the AOB

Florida law requires that an AOB contract “[c]ontain a provision requiring the assignee to provide a copy of the executed assignment agreement to the insurer within 3 business days after the date on which the assignment agreement is executed or the date on which work begins, whichever is earlier. Delivery of the copy of the assignment agreement to the insurer may be made: a. By personal service, overnight delivery, or electronic transmission, with evidence of delivery in the form of a receipt or other paper or electronic acknowledgment by the insurer; or b. To the location designated for receipt of such agreements as specified in the policy.” Section 627.7152(2)(a)(4), Florida Statutes .

When the AOB contract is signed, it must contain an itemized, per-unit cost estimate of the repair work.

Florida law requires that an AOB contract “[c]ontain a written, itemized, per-unit cost estimate of the services to be performed by the assignee.” Section 627.7152(2)(a)(5), Florida Statutes .

Two important notes here.

First, you need to attach the estimate to the AOB before the policyholder signs the AOB . Providing an estimate to the policyholder after the parties sign the AOB puts the AOB at risk of being attacked as unenforceable. Several Florida contractors have learned this the hard way. In one case, a court held that providing the estimate to the property owner just one day after the parties had signed the AOB rendered it unenforceable. JPJ Servs. LLC v. New Hampshire Ins. Co. , No. 21-14329-CIV (S.D. Fla. June 3, 2022) .

Second, the estimate needs to be detailed . A top-line price for the work won’t suffice. Nor will a standard pricing list for products or services. In fact, a Florida appellate court has specifically decided that a standard pricing list for remediation services attached to an AOB did not qualify as an “itemized, per-unit cost estimate” under Section 627.7152(2)(a)(5) and therefore the AOB was void and unenforceable. Air Quality Experts Corp. v. Fam. Sec. Ins. Co., 351 So. 3d 32 (Fla. Dist. Ct. App. 2022) .

The AOB contract must be limited to repairs or mitigation for dwellings and structures

Florida law provides that the AOB contract “must relate only to work to be performed by the assignee for services to protect, repair, restore, or replace a dwelling or structure or to mitigate against further damage to such property.” Section 627.7152(2)(a)(6), Florida Statutes .

The AOB contract must contain a very specific notice to the policyholder

Specifically, Florida law requires that the AOB contract contain the following notice in 18-point uppercase and boldfaced type:

YOU ARE AGREEING TO GIVE UP CERTAIN RIGHTS YOU HAVE UNDER YOUR INSURANCE POLICY TO A THIRD PARTY, WHICH MAY RESULT IN LITIGATION AGAINST YOUR INSURER. PLEASE READ AND UNDERSTAND THIS DOCUMENT BEFORE SIGNING IT. YOU HAVE THE RIGHT TO CANCEL THIS AGREEMENT WITHOUT PENALTY WITHIN 14 DAYS AFTER THE DATE THIS AGREEMENT IS EXECUTED, AT LEAST 30 DAYS AFTER THE DATE WORK ON THE PROPERTY IS SCHEDULED TO COMMENCE IF THE ASSIGNEE HAS NOT SUBSTANTIALLY PERFORMED, OR AT LEAST 30 DAYS AFTER THE EXECUTION OF THE AGREEMENT IF THE AGREEMENT DOES NOT CONTAIN A COMMENCEMENT DATE AND THE ASSIGNEE HAS NOT BEGUN SUBSTANTIAL WORK ON THE PROPERTY. HOWEVER, YOU ARE OBLIGATED FOR PAYMENT OF ANY CONTRACTED WORK PERFORMED BEFORE THE AGREEMENT IS RESCINDED. THIS AGREEMENT DOES NOT CHANGE YOUR OBLIGATION TO PERFORM THE DUTIES REQUIRED UNDER YOUR PROPERTY INSURANCE POLICY.

Section 627.7152(2)(a)(6), Florida Statutes .

In the AOB contract, you must indemnify the policyholder.

Under Florida law, the AOB must “[c]ontain a provision requiring the assignee to indemnify and hold harmless the assignor from all liabilities, damages, losses, and costs, including, but not limited to, attorney fees.” Section 627.7152(2)(a)(7), Florida Statutes .

The AOB contract cannot contain a penalty or fee for rescission, processing checks, cancelling the agreement, or administrative costs.

Under Florida law, “an assignment agreement may not contain: 1. A penalty or fee for rescission under subparagraph (a)3.; 2. A check or mortgage processing fee; 3. A penalty or fee for cancellation of the agreement; or 4. An administrative fee.” Section 627.7152(2)(b), Florida Statutes .

The Law Requires You to Cooperate with Insurance Carriers

Florida law set out very specific actions that a roofer, mitigation pro, restoration specialist, or other contractor working under an AOB must take when dealing with an insurance company. The requirements are specific enough that it’s worth reproducing the statutory language directly:

A [contractor, roofer, restoration pro, etc.] (a) Must provide the assignor with accurate and up-to-date revised estimates of the scope of work to be performed as supplemental or additional repairs are required. (b) Must perform the work in accordance with accepted industry standards. (c) May not seek payment from the assignor exceeding the applicable deductible under the policy unless the assignor has chosen to have additional work performed at the assignor’s own expense. (d) Must, as a condition precedent to filing suit under the policy, and, if required by the insurer, submit to examinations under oath and recorded statements conducted by the insurer or the insurer’s representative that are reasonably necessary, based on the scope of the work and the complexity of the claim, which examinations and recorded statements must be limited to matters related to the services provided, the cost of the services, and the assignment agreement. (e) Must, as a condition precedent to filing suit under the policy, and, if required by the insurer, participate in appraisal or other alternative dispute resolution methods in accordance with the terms of the policy. Section 627.7152(4), Florida Statutes .

Limited Reimbursements for Emergency Repair AOBs

Contractors should know that Florida law limits insurance reimbursements for emergency repairs, such as roof tarping and water mitigation. Specifically, Section 627.7152(2)(c), Florida Statutes , caps insurance reimbursements for AOB repairs made under “urgent or emergency circumstances” at $3,000 or 1 percent of the applicable Coverage A limit, whichever is greater. Section 627.7152(2)(d), Florida Statutes . In addition, if the AOB contract provides for reimbursement beyond these limits, the AOB is invalid and unenforceable. The statute defines “urgent or emergency circumstances” as “a situation in which a loss to property, if not addressed immediately, will result in additional damage until measures are completed to prevent such damage.”

Collecting Against Policyholders Prohibited

By signing an AOB, you permanently waive your right to collect from or sue the policyholder for payments owed for services described in the AOB. This waiver of your right to collect or sue is fundamental to the AOB, and specifically covered by statutes. In Florida, the waiver applies even if the policyholder rescinds the AOB or the AOB is later held to be invalid.

There are a few important exceptions to the general waiver above. Specifically, a policyholder is responsible for:

Any applicable deductible.
Any betterment ordered and performed that is approved by the named insured.
Any contracted work performed before the assignment agreement is rescinded.

Section 627.7152(7), Florida Statutes .

Social Security

Program operations manual system (poms).

TN 35 (04-14)

GN 02410.001 Assignment of Benefits

A. protection from assignment of benefits.

Sections 207 and 1631(d)(1) of the Social Security Act (the Act) prohibit “transfer” or “assignment” of a beneficiary or recipient’s right to future payment under title II and title XVI respectively. These sections of the Act prohibit the transfer of control over money to someone other than the beneficiary, recipient, or the representative payee. These sections also protect the beneficiary or recipient's right to receive payments directly, and to choose how to use the payments.

Our responsibility for protecting payments against legal process and assignment ends when we pay the beneficiary or recipient. However, once paid, Sections 207 and 1631(d)(1) of the Act continue to protect payments as long as we can identify them as:

Retirement, Survivors and Disability Insurance (RSDI) benefits; or

Supplemental Security Income (SSI) payments.

For example, this would include a situation in which RSDI or SSI payments are the only direct deposit payments in the account.

A beneficiary or recipient can use Sec. 207 or 1631(d)(1) of the Act as a personal defense if ordered to pay his or her payments to someone else, or if his or her payments are ordered to be taken by legal process.

B. Exceptions to protection from assignment of benefits

Laws may create exceptions to the protections provided under Sec. 207 and 1631 of the Act, but only if they explicitly identify the applicable section, either Sec. 207 or 1631 (also found in the United States Code as 42 USC 407 or 42 USC 1383), and provide that the law applies despite that section. So far, Congress has authorized the following exceptions to Sec. 207 and 1631 of the Act.

1. Garnishment of benefit payments for child support or alimony

Garnishment is the legal process of withholding an amount from money owed to a person in order to pay off the person’s debt to another. Under Sec.459 of the Act (42 USC 659), garnishment of benefit payments for the purpose of collecting amounts owed for child support or alimony is permitted. For policy on garnishment of title II benefits, see GN 02410.200 through GN 02410.225 .

2. Garnishment of benefit payments for victim restitution

Garnishment of benefit payments to recover court-ordered victim restitution is permitted under 18 USC 3613(a), 3663, 3663A, and 3664. For policy on garnishment for court-ordered victim restitution, see GN 02410.223 .

3. Levy for unpaid federal taxes

Levy is the legal seizure of property, such as Social Security benefit payments, to recover a debt. The IRS places a levy on benefit payments to recover unpaid federal taxes under 26 USC 6331 and 6334. For policy on IRS levy, see GN 02410.100 .

C. Fees and automatic withdrawals

State or Federal government guidelines do not regulate financial institution (FI) fees. These fees are a matter of contract between banks and their customers. Customary fees outlined in account contracts with FIs, and the automatic withdrawal of these fees, do not constitute an assignment of benefits. For a definition of an acceptable FI, see GN 02402.030 .

1. Financial institution

The following banking options meet Treasury’s definition of an acceptable FI:

Savings and loan associations,

Credit unions, or

Thrift institutions.

For policy on acceptable financial institutions, see GN 02402.030 .

NOTE : A master sub-account is an account at an FI established to receive deposits on behalf of a group of individuals. Sub-accounts are then set up at the same FI, another FI, or on the individual ledgers maintained by the master account holder. An acceptable master sub-account relationship is not an assignment of benefits. For policy on acceptable master sub-account relationships, see GN 02402.050 .

2. Account fees

We do not prohibit automatic withholding of account fees from accounts holding SSA payments when those fees are customary to accounts with the FI.

A fee is “customary” if it is consistent with fees associated with similar accounts at the FI and the same fees apply to both federal and non-federal deposits.

NOTE : We should question fees that apply only to federal payments. If the FI applies different fees to federal and similar non-federal deposits, send the issue in question to the Regional Office (RO).

3. Pre-authorized withdrawals

A beneficiary recipient, or his or her representative payee, may pre-authorize an FI, or other entity, to withdraw funds from his or her account for a wide variety of purposes (e.g., utility bills, mortgage payments, loan repayments, investments, nursing home fees, etc.). Once the beneficiary recipient, or his or her representative payee, establishes control by receipt and deposit of the payment, these arrangements are allowed, provided they can be terminated at any time. Terminating the arrangement does not mean terminating or canceling the debt. It means that the beneficiary recipient, or his or her representative payee, may terminate the pre-authorized withdrawal arrangement as a method for paying the debt. The right to receive and to choose how to use those payments exists if the beneficiary recipient, or his or her representative payee, can freely terminate this arrangement. If a beneficiary recipient, or his or her representative payee, cannot freely revoke the pre-authorized withdrawal, send the issue in question to the RO.

D. Prohibited arrangements versus acceptable relationships

The beneficiary recipient’s, or his or her representative payee’s, control of the receipt and use of payments will determine if a payment arrangement is prohibited or acceptable.

1. Prohibited arrangements

A. payment to the wrong person.

Do not make payment to any person or entity other than the beneficiary recipient, or his or her representative payee, except as outlined in GN 02410.001B and GN 02410.001C in this section. This prohibition applies regardless of the person or entity who makes the request.

For example, the prohibition applies when:

a beneficiary or recipient requests that we pay his or her payments to someone other than the beneficiary or the beneficiary’s representative payee.

a court orders SSA to make payment to a party other than the beneficiary or recipient, unless one of the specific exceptions in GN 02410.001B in this section exists. For policy on when SSA should not comply with a bankruptcy court’s order to pay benefits to a bankruptcy trustee, see GN 02410.005 .

When you are unable to determine whether there is a prohibited arrangement, send the issue in question to the RO.

b. Other prohibited arrangements

Even if the payment goes directly to the beneficiary or recipient (or the representative payee), the arrangement may is prohibited if the beneficiary or recipient surrenders control of the payments. Avoid any arrangement where the beneficiary or recipient surrenders or shares control of payments with a person or entity that has an interest in charging or collecting money from the beneficiary or recipient.

Avoid the following situations:

Do not approve sending a payment, either by check or electronically, to a loan company where the beneficiary or recipient has a loan, or to a party holding the beneficiary or recipient's power of attorney. For information on power of attorney, see GN 02410.010 .

Do not approve a bank account when the attorney or non-attorney representative has the power to withdraw funds so that representative’s fees can be collected directly from that beneficiary or recipient’s account. See the note in GN 03920.025A . For policy on unacceptable requests for direct deposit, see GN 02402.085 .

In both scenarios given, the arrangement is prohibited because the beneficiary or recipient surrenders control over the payment.

When you are unsure of a prohibited arrangement, send the issue in question to the RO.

2. Acceptable relationships

A. third-party repayment.

Third parties may employ representatives to ensure that beneficiaries or recipients repay debts owed to the third parties immediately after the beneficiary or recipient starts to receive payment. This arrangement is acceptable if:

The third-party representative has no financial interest in the beneficiary or recipient’s direct deposit account (i.e., he is not named on the account and has no authority to direct the money in the account);

The third party representative is not charging the beneficiary or recipient a fee;

The beneficiary or recipient pre-authorizes, (according to the financial institution’s policy), a withdrawal of funds from his account to repay a debt to a third party;

The third-party representative did not obtain the pre-authorization from the beneficiary or recipient through deceit, coercion, or intimidation; and

The third-party representative gets oral or written confirmation from the beneficiary or recipient of the pre-authorization to withdraw the money from the account after we deposit funds into the beneficiary or recipient’s account and before a transfer of funds to pay the third party debt.

NOTE : Confirmation is necessary because a beneficiary or recipient may have signed the pre-authorization before learning whether he or she will receive benefits and the amount of past-due benefits he or she will receive. In this situation, confirmation prevents the third party from taking funds before the beneficiary or recipient exercises control over the funds.

b. Financial institution-electronic funds distributor (FI-EFD) accounts

Some FI have established Electronic Funds Distributor (EFD) relationships with various check cashing establishments to receive and distribute monthly direct deposit payments to assist SSA beneficiaries or recipients who do not have traditional bank accounts.

The FI receives the monthly payment by direct deposit titled under the beneficiary or recipient’s name. Then, the FI electronically transfers payment to the contracted EFD. The EFD, acting as an agent of the FI, will then release the monthly payment to the account holder in the form of a cashier’s check.

These FI-EFD accounts are acceptable and not prohibited if they meet the following requirements:

The FI must be acceptable under United States Treasury guidelines. (For policy on acceptable types of financial institutions, see GN 02402.030A .)

The EFD must have a contract with and act as an agent of the FI.

The FI account must be acceptable as outlined in GN 02402.030 B.1 .

A secondary contract relationship that attaches the FI-EFD transaction account as collateral for loan fees associated with the EFD cannot exist as a requirement for participation between the EFD and the beneficiary or recipient.

No person or entity can have control over the receipt, or use of, SSA benefit payments other than the beneficiary or his or her representative payee. (For Assignment of Benefits, see GN 02410.001 and Sec.1631 (d)(1).)

The beneficiary, recipient, or representative payee may cancel his or her FI-EFD direct deposit arrangement at any time.

Fees associated with the account must be customary to fees for similar accounts at the FI and those fees are outlined in the FI-customer contract.

When you are unable to clearly determine whether an FI-EFD account is acceptable, send the issue in question to the RO.

E. Examples of acceptable and prohibited relationships

1. acceptable relationship.

A company pays long-term disability (LTD) benefits to a customer and requires them to file for Social Security title II benefits. When the Social Security claim is allowed, the amount of Social Security benefits received offsets the LTD benefit amount. As an incentive to induce the LTD insurer to refer claimants, the claimant’s LTD representative offers to assist the insurer with recovering the overpayment the insurer made to the claimant. The LTD representative does not charge the claimant a fee for this service. The LTD representative also makes it clear to the claimant that he or she may pay the LTD directly and does not have to pay the LTD through the representative.

At the LTD representative’s request, the claimant gives the representative pre-authorization to withdraw funds from the claimant’s bank account if SSA approves the claim and issues the claimant past-due benefits.

After we approve the claim and deposit the past-due benefits into the claimant’s account, the LTD representative gets oral authorization (in addition to the pre-authorization) to transfer those funds to the LTD insurer to satisfy the LTD overpayment. The LTD representative also documents the oral authorization. We will accept this arrangement. The beneficiary is exercising control over the past-due benefits deposited into his or her account before the pre-authorized transfer of funds, and the beneficiary understands that he or she could have elected to pay the LTD directly. The LTD provider does not receive a fee from the beneficiary and obtains a pre-authorization to transfer funds from the beneficiary’s account in order to repay the third party (i.e., the overpayment of payments from the insurer). The LTD representative also gets authorization after deposit of the SSA benefit payment into the beneficiary’s account. For policy on acceptable third-party repayment arrangements, see GN 02410.001D.2.a. , in this section.

b. Master sub-account

Comfort Nursing Home maintains a master sub-account titled “Comfort Nursing Home Patients' Accounts” at New State Bank for the convenience of its residents. The nursing home sets up a separate sub-account for each resident. Residents sign agreements for the nursing home to withdraw monthly amounts for care costs. Residents can withdraw any amount, up to the balance in their accounts for personal expenses and they have the right to terminate the account at any time. The nursing home keeps track of all deposits and withdrawals. This is an acceptable master sub-account. For policy on acceptable master sub-accounts with FI, see GN 02402.050 .

c. FI-EFD

Big Bucks Bank Inc. (BBB) is an accepted FI. BBB offers the “We-Pay-U” program for customers without traditional bank accounts. We-Pay-U program customers sign a contract and establish a non-interest bearing account with BBB for the sole purpose of electronic transfer of federal or non-federal monthly payments to that account. Beneficiaries or recipients can then receive their SSA payments in the form of a cashier's check from Brown Bear Check Cashing. Brown Bear Check Cashing acts as an agent of BBB and must adhere to the rules and regulations of BBB in relation to the We-Pay-U account. The We-Pay-U customer agrees to a monthly processing fee associated with the We-Pay-U account, which BBB withdraws from their payment automatically. This is an acceptable relationship. The beneficiary or recipient has established control of their payment and the fees associated with the We-Pay-U program. Because the account fees in the contract apply to both federal and non-federal monthly payments, we consider them customary to the BBB account. For policy on acceptable FI-EFD arrangements, see GN 02410.001D.2.b. in this section.

2. Prohibited arrangement

A beneficiary or recipient has appointed an attorney representative to help him in proceedings before SSA. SSA is not paying an attorney fee directly to the representative. The beneficiary or recipient establishes a checking account in his or her own name that requires the signature of both the beneficiary or recipient and the attorney on checks written to withdraw funds from the account. The beneficiary or recipient requests direct deposit of his or her payments to that account. This is a prohibited arrangement because the beneficiary or recipient has given control of access to payments to the attorney representative. See the following references for additional information:

For policy on Who is a Representative, see GN 03910.020 .

For policy on representative’s fees in trust or escrow accounts, see GN 03920.025 .

For policy on acceptable types of financial institutions and accounts, see GN 02402.030 .

For policy on payment to the wrong person, see GN 02410.001D.1. , in this section.

F. References

GN 02402.030 Acceptable Types of Financial Institutions and Accounts

GN 02402.050 Account Titles

GN 02402.085 Unacceptable Requests for Direct Deposit

GN 03910.020 Who Is a Representative

GN 03920.017 Payment of Representative's Fee

GN 03920.025 Representative's Fee - Trust or Escrow Accounts

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What is Assignment of Benefits in Medical Billing?

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An assignment of benefits is the act of signing documentation authorizing a health insurance company to pay a physician directly. In other words, the insurance company can pay claims without the direct involvement of the patient in the process. There are other situations where AOBs can be helpful, but we’ll focus on their use in relation to medical benefits.

If there isn’t an assignment of benefits agreement in place, the patient would be responsible for paying the other party directly from their own pocket, then filing a claim with their insurance provider to receive reimbursement. This could be time-consuming and costly, especially if the patient has no idea how to file a claim.

The document is typically signed by patients when they undergo medical procedures. The purpose of this form is to assign the responsibility of payment for any future medical bills that may arise after the procedure. It’s important to note that not all procedures require an AOB.

An assignment of benefits agreement might be utilized to pay a medical practitioner the patient didn’t choose, like an anesthesiologist. The patient may have picked a surgeon, but an anesthesiologist assigned on the day of the procedure might issue a separate bill. They’re, in essence, signing that anyone involved in their treatment can receive direct payment from the insurance carrier. It doesn’t have to go through the patient.

This document can also eliminate service fees surrounding processing. As a result, the patient can focus on medical treatment and recovery without being bogged down with the complexities of paying medical bills. The overall intent of an assignment of benefits agreement is to make the process more manageable for the patient, as they don’t need to haggle directly with their insurer.

List of Providers and Services

When the patient signs an AOB agreement, they give a third party right to obtain payment for services the provider performed, and medical billing services are a prime example of where they may sign an AOB agreement.

Ambulance services
Medical insurance claims
Drugs and pharmaceuticals
Diagnostic and clinical lab services
Emergency surgical center services
Dialysis supplies and equipment used in the home
Physician services for Medicare and Medicaid patients

Services of professionals other than a primary care physician, which includes:

Physician assistants
Clinical nurse specialists
Clinical social workers
Clinical psychologists
Certified registered nurse anesthetists

doctor at desk filling out forms on clipboard

Information Commonly Requested on Assignment of Benefits Form:

Signature of patient or person legally responsible
Signature of parent or legal guardian

How AOBs Affect the Medical Practitioner

A medical provider or their administrative staff may feel overwhelmed by the sheer number of forms patients must fill out prior to treatment. Demanding more paperwork from patients may be seen as an added burden on the managerial staff, as well as the patient. However, getting a signed AOB is vital in preserving the interests of everyone involved.

In addition to receiving direct payment from the insurance company without needing to go through the patient, a signed assignment of benefits form will help medical providers appeal denied and underpaid claims. They can ask that payments be made directly to them rather than through the patient. This makes the process more manageable for both the doctors and the patient.

Things to Bear in Mind

The patient gives their rights and benefits to third parties under their current health plan. Depending on the wording in the AOB, their insurer may not be allowed to contact them directly about their claims. In addition, the patient may be unable to negotiate settlements or approve payments on their behalf and enable third parties to endorse checks on behalf of the patient. Finally, when the patient signs an AOB, the insurer may sue the third parties involved in the dispute.

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Now Available - CBMA Importer Claims System | CBMA Import Resources

Imports – Tax Benefits under the Craft Beverage Modernization Act (CBMA)

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New Provisions

The Craft Beverage Modernization Act (CBMA) provisions of the U.S. Internal Revenue Code provide for reduced rates or tax credits for beer, wine, and distilled spirits produced in or imported into the United States. These CBMA tax benefits are limited in quantity for each producer, including foreign producers. Foreign producers utilize these CBMA tax benefits by assigning them to U.S. importers of their products. U.S. importers pay the Federal excise tax on imported beer, wine, and distilled spirits, and must receive an assignment of the CBMA tax benefits from the foreign producer to take advantage of the CBMA tax benefits.

From 2018 to 2022, U.S. Customs and Border Protection (CBP) has administered the CBMA tax provisions related to imported products.

A change in the law transferred responsibility for administering the CBMA tax benefits for imported alcohol from CBP to TTB beginning with products entered for consumption in the United States on or after January 1, 2023.

The law also changed the way in which importers will take advantage of tax benefits assigned to them. Starting January 1, 2023, importers who want to take advantage of assigned tax benefits must pay the full tax rate to CBP and then subsequently submit a claim to TTB for a refund.

Hot Topics:

CBMA Importer Claims System: Your Questions Answered
CBMA Series: Importer Claims System Walkthrough
CBMA Series: Preparing for Importer Claims
CBMA Series: Overview of Foreign Producer Registration System
TTB's Craft Beverage Modernization Act (CBMA) Imports Overview
Read Information on Getting Started with the myTTB System
Avoid ACE Data Errors that may Delay Payment of CBMA Importer Refund Claims

For more information:

See TTB Industry Circular 2022-3 for updated guidance on how to calculate and use effective tax rates or standard effective tax rates (SETRs) for imported distilled spirits products that are eligible for CBMA tax benefits
See CBP's CSMS message #54427266 of 12/20/2022 on the CBMA procedures and requirements for 2023 and after
Access myTTB for Foreign Producer Registrations and Assignments
View TTB's Overview of New CBMA Import Provisions webinar slides
See TTB’s temporary rule T.D. TTB-186 , effective October 24, 2022.
See TTB’s notice of proposed rulemaking Notice No. 215 in Docket No. TTB-2022-0009 at Regulations.gov . The comment period for the Notice closed November 22, 2022.

CBMA myTTB Data:

Foreign Producer Registrations as of February 13, 2024: 13,259

Overview for Importers ● Overview for Foreign Producers ● ACE Resources ● myTTB System User Guides ● General CBMA Import Program FAQs ● Importer Claims FAQs ● Foreign Producer Registration Questions and Answers ● CBMA Tax Benefit Assignment Questions and Answers

Summary of CBMA Import Refund Provisions for Distilled Spirits, Wine, and Beer

The following summaries outline the new provisions covering importers and foreign producers.

Overview for Importers

General: For beer, wine, and distilled spirits entered for consumption in the United States on or after January 1, 2023, an importer must pay the full rate of tax to CBP.

To take advantage of the CBMA reduced tax rates or tax credits, the importer must electronically file a refund claim with TTB. Importers may file refund claims after the close of each calendar quarter covering their entries in that quarter.

An importer cannot claim a refund unless the foreign producer of the imported beer, wine, or distilled spirits has assigned their CBMA tax benefits to that importer using the myTTB online system .

Customs Entry Filings: Before claiming a refund, the importer must submit information in their customs entry filing(s) identifying the products that will be subject to their claim, including:

The commodity (i.e., beer, wine, or distilled spirits) and quantity (i.e., beer barrels, wine gallons, or proof gallons) being imported with an assigned CBMA tax benefit;
The name and TTB Foreign Producer ID of the foreign producer assigning the CBMA tax benefits; and
The specific reduced tax rate or tax credit assigned to the imported quantity.

This information is generally consistent with the information importers were required to submit to CBP to take advantage of CBMA tax benefits prior to 2023, except that TTB will use a new TTB-issued Foreign Producer ID number to identify foreign producers. See Craft Beverage Modernization Act (CBMA) – 2022 Procedures and Requirements, CSMS #50484790 (Dec. 23, 2021).

This information must be submitted electronically as part of the importer’s customs entry filing(s) in CBP’s Automated Commercial Environment (ACE). More detailed information on the entry filing requirements is available in the CBP and Trade Automated Interface Requirements (CATAIR) Entry Summary Create/Update on CBP’s website .

Importers intending to file CBMA importer refund claims must also file the TTB Message Set electronically in ACE. For instructions, see ACE Filing Instructions for TTB-Regulated Commodities | U.S. Customs and Border Protection (cbp.gov) .

Quarterly Refund Claims: An importer can file a quarterly refund claim based on CBMA tax benefits assigned to them after imported products have entered the United States for consumption, and after the importer has paid to CBP the tax due on those products at the full tax rate. Importers may not file refund claims more frequently than quarterly. That is, the calendar quarter must end before CBMA import refund claims may be filed for any consumption entries made during that quarter.

Use of myTTB Online System: Importers must submit CBMA refund claims electronically using the myTTB online system. Importers may authorize third party agents to submit filings on their behalf within the myTTB online system. Importers are responsible for ensuring that they (or their agents) have submitted accurate data in ACE before submitting a CBMA refund claim to TTB. Step-by-step instructions on filing claims are available in the Importer Claims User Guide .

Overview for Foreign Producers

General: Foreign producers may assign the CBMA tax benefits to one or more U.S. importers of their products. An importer cannot take advantage of tax benefits unless the foreign producer has assigned their tax benefits to the importer.

Quantity Limitations: By law, each foreign producer may only assign a limited quantity of tax benefits for each category of their products imported into the United States (beer, wine, or distilled spirits). Please see FAQ TB-1 for more detailed information on the quantities eligible to be assigned each calendar year.

Use of myTTB Online system : In the past, foreign producers assigned CBMA tax benefits to one or more importers using a letterhead template published by CBP. TTB will not accept letterhead assignments for calendar years 2023 and beyond. For products imported on or after January 1, 2023, foreign producers must use the myTTB online system to assign CBMA tax benefits to importers.

Foreign Producer Registration: Before assigning CBMA tax benefits, a foreign producer must first register with TTB using the online myTTB system and receive a TTB Foreign Producer ID. A foreign producer will need to provide the following information to register:

Basic information about the business (such as business name and address) and contact information for a point of contact for the business (see FAQ FP-1 );
Their unique U.S. Food and Drug Administration (FDA) Food Facility Registration number(s) (see FAQ FP-2 ); and
Ownership information, if under common ownership with other foreign or U.S. alcohol producers (see FAQ FP-1 ).

When a foreign producer’s TTB registration is complete, TTB will issue a TTB Foreign Producer ID and the foreign producer will be able to make assignments through the electronic myTTB system. U.S. importers will use the TTB Foreign Producer ID to identify the foreign producer when submitting information to CBP during the entry process as well as when submitting CBMA import refund claim information to TTB.

Assigning Benefits to Importers: To assign CBMA tax benefits to importers, foreign producers will need to provide the following information:

The calendar year for which the CBMA tax benefits are being assigned;
The importer to whom the assignment is made, identified by TTB permit number (or TTB-assigned reference number when an importer is not required to have a TTB permit);
The commodity (i.e. beer, wine, or distilled spirits) for which the assignment is made;
The specific reduced tax rate or tax credit being assigned; and
The quantity of proof gallons, wine gallons, or beer barrels on which tax benefits are being assigned.

The quantities of tax benefits available to be assigned may be impacted by controlled group rules in cases of common ownership among producers. Please see FAQs TB-1 - 2 for additional information on quantity limitations.

ACE Resources

Ace cbma tax rates table.

See the ACE CBMA Tax Rates Table . Use these codes for consumption entries on or after January 1, 2023 when the filer has or reasonably expects to have a CBMA tax benefit assignment from the foreign producer and expects to file a refund claim with TTB based on the assigned lower Internal Revenue Tax (IRT) rate or credit.

Avoiding ACE Data Errors that may Delay Payment of CBMA Importer Refund Claims

See Avoiding ACE Data Errors

myTTB System User Guides

Foreign producer registration and assignment system.

See the Foreign Producer Registration and Assignment System User Guide

Before you register as a Foreign Producer or if you receive an error message when you attempt to register, read this new guidance on common errors.

See the Foreign Producer Registration Common Errors

Importer Claims System

Importer Claims User Guide

Alternate Claims User Guide

General CBMA Import Program FAQs

Gi-1: when do the new cbma procedures take effect.

The new TTB procedures for obtaining CBMA tax benefits apply to merchandise entered for consumption with an Entry Date of January 1, 2023, and after.

GI-2: What can an authorized agent for a foreign producer do?

In TTB’s foreign producer registration and assignment system, an authorized agent for the foreign producer is able to submit and/or edit the foreign producer’s registration information; assign CBMA tax benefits that the foreign producer is eligible to make under law; view all information submitted on behalf of the foreign producer in the system, including information submitted by other authorized persons; receive and respond to communications from TTB regarding the foreign producer; and may also be able to designate additional users depending on the scope of the agent’s authorization. When entering registration or assignment information into TTB’s system, an authorized agent is acting solely as the foreign producer’s agent, and is not acting in their own capacity. The foreign producer and their agents (including any agents who are also importers) are responsible for ensuring that information entered in TTB’s system is accurate and consistent with the foreign producer’s intent.

GI-3: Can a customs broker submit the refund claims to TTB on behalf of a U.S. importer?

An importer may authorize an agent, including a customs broker, to act on the importer’s behalf for purposes of submitting the CBMA refund claim. Generally, TTB importers will be able to grant authorization electronically to third parties through the myTTB system. More information is available on the Getting Started in myTTB page.

GI-4: Do the assignment certification, CBMA spreadsheet, and controlled group spreadsheet that were required in past years also need to be submitted with the refund request to TTB?

In prior years, CBP required three documents that it referred to as an assignment certification, a CBMA spreadsheet, and a controlled group spreadsheet. See, for example, CBP’s message CSMS #50484790 . These were supporting documents for CBMA claims processed under CBP procedures. In general, those requirements applied to goods imported and entered, or withdrawn from a warehouse, for consumption on or before December 31, 2022.

TTB’s procedures for submitting refund claims, starting in 2023, generally rely on information submitted directly through the myTTB system, and TTB does not require the three CBP documents to be created. However, an importer, or its agent, may still be required to submit to TTB the assignment certification, CBMA spreadsheet, and controlled group spreadsheet that were required and created under the CBP procedures in prior years in certain circumstances. For example, TTB may request these documents for claims submitted to TTB with an entry date of January 1, 2023, or later, but an import date prior to January 1, 2023. Additional information on the requirements for claims that fall into this category is available in TTB Industry Circular 2023-1 .

GI-5: If I plan to claim tax benefits, do I have to wait to import products until the foreign producer has registered and made an assignment?

An importer can import the products that will be subject to a refund claim before the foreign producer registers with TTB, obtains a TTB Foreign Producer ID, and assigns tax benefits. However, because the Foreign Producer ID and assignment information will not be available to the importer at the time of entry, the importer will need to update that information in ACE through a post-summary correction prior to filing a refund claim with TTB.

Importer Claims FAQs

Cb-c1: when can i file my claim.

An importer can file a refund claim after the imported products have been entered for consumption in the United States, and after the importer has paid to CBP the tax due on those products.

Additionally, CBMA importer refund claims have a quarterly period. That is, the calendar quarter must end before CBMA refund claims may be filed for any consumption entries made during that quarter. For example, the first day that an importer can file a refund claim for products entered on May 20 is July 1 of that year, because July 1 is the first day after the end of the quarter in which the products were entered for consumption.

Where the first day following the close of a calendar quarter falls on a weekend or holiday, claims for products entered during that calendar quarter may be filed beginning the next business day.

Revised 7/5/23 to add information regarding filing on weekends or holidays.

CB-C2: How do I file a claim?

Importers are required to file CBMA refund claims online through myTTB’s CBMA Importer Claims system. See TTB’s Importer Claims User Guide for step-by-step instructions on filing claims.

CB-C3: I need to provide an importer basic permit number to my foreign producer so they can assign tax benefits to me. However, I am not required to have an importer basic permit. What should I do?

An importer who does not have, and is not required to obtain, an FAA Act basic permit (for example, importers who import only industrial alcohol) must request and receive a reference number from TTB. Contact TTB’s National Resource Center here .

Foreign producers use the reference number to assign tax benefits to the importer. Importers should enter the reference number in place of a TTB permit number when entering import data as part of the importer’s customs entry filing in CBP’s Automated Commercial Environment (ACE).

CB-C4: How long will it take me to get my refund?

TTB envisions that complete and valid claims will be paid shortly after they are filed. However, the myTTB CBMA Importer Claims system relies not only on accurate and complete information being submitted through that system but also on accurate and complete information being submitted electronically as part of the importer’s customs entry filing(s) in CBP’s Automated Commercial Environment (ACE). Inaccurate or incomplete data will significantly delay TTB’s processing of the claim.

CB-C5: Will importers receive a notification when a foreign producer makes an assignment to them?

Currently, the myTTB systems are not designed to send a notification to an importer when a foreign producer makes an assignment of tax benefits to them. However, importers can view all assignments made to them in the myTTB CBMA Importer Claims system.

CB-C6: My CBMA tax benefit assignments from foreign producers are in proof gallons (distilled spirits), wine gallons (wine), and barrels (beer), but I enter my imported quantities in ACE in proof liters or liters. How can I convert my imported quantities to track them against my assignments?

Importers can use the following conversion factors:

Distilled spirits conversion factor: 1 proof liter = 0.264172 proof gallon

Wine conversion factor: 1 liter = 0.26417 wine gallon

Beer conversion factor: 1 liter = 0.008522 beer barrel

CB-C7: I would like to receive my CBMA refund as a check, but I need to update my mailing address. How do I do that?

Users that have an account in Permits Online (PONL) should update the mailing address information in PONL. Users that do not have a PONL account (those with a TTB reference number) will need to contact TTB to correct the mailing address.

Foreign Producer Registration FAQs

Fp-1: what information must a foreign producer provide to register and obtain a foreign producer id from ttb.

Foreign producers seeking to assign CBMA tax benefits must register online through myTTB in order to receive a TTB Foreign Producer ID and assign tax benefits to a U.S. importer. In order to complete the registration process, the foreign producer (or their agent, see FAQ FP-4 ) will need to enter the following information, in the English language, through myTTB .

Name, country of residence, and principal business address of the foreign producer;
Name, title, country of residence, phone number, and email address of an employee or individual owner of the business who has authority to act for the business;
If the person registering the foreign producer is different from the employee or individual owner, the name, address, phone number, and email address of the person who is completing the registration on behalf of the foreign producer; and
U.S. Food and Drug Administration (FDA) Food Facility Registration Number(s).

Foreign producers who are under common ownership with other foreign or U.S. distilled spirits operations, wineries, or breweries also assigning CBMA tax benefits or taking advantage of CBMA tax benefits (in the case of U.S. alcohol producers) must also provide the following information for any individual or entity that owns 10 percent or more of the registering foreign producer:

The name, address, and phone number of the individual or entity owner; and
For entity owners, the Employer Identification Number if the entity is a U.S. entity and has an EIN or the Dun & Bradstreet Data Universal Numbering System (DUNS) number if the entity is a foreign entity and has a DUNS number.

FP-2: What is the FDA Food Facility Registration Number and when is it required as part of a foreign producer’s TTB registration?

The U.S. Food and Drug Administration (FDA) requires foreign beverage alcohol producers to obtain an FDA Food Facility Registration number for their production facilities before their products are imported into the United States. As part of the TTB registration process, foreign producers who seek to assign reduced rates will be required to submit to TTB each FDA Food Facility Registration number that they have already obtained for FDA purposes prior to the importation of their distilled spirits, wine, or beer, into the United States.

In cases where a foreign producer does not have a Food Facility Registration number because all of their products are further manufactured, processed, or bottled by another foreign facility prior to shipment to the United States, the foreign producer must obtain and submit the Food Facility Registration number of the other facility. Alternatively, a foreign producer of industrial alcohol may confirm that it does not have an FDA Food Facility Registration because FDA does not require one for its operations.

FP-3: Who should the foreign producer identify as the “Foreign producer contact” when registering in myTTB?

The foreign producer contact should be an employee or owner of the foreign producer. This individual will serve as the foreign producer point of contact for TTB and should not be the foreign producer’s agent or any other individual or entity acting on behalf of the foreign producer.

Note that this individual will be the recipient of any notices from TTB regarding the foreign producer’s registration or CBMA tax benefit assignments.

FP-4: May a foreign producer use a third party agent to submit its TTB foreign producer registration and CBMA tax benefit assignment information on its behalf?

A foreign producer may have a third party agent register the foreign producer with TTB and make assignments of CBMA tax benefits to importers on its behalf. Once a registration has been created for a foreign producer, no additional registration can be completed for that foreign producer because each foreign producer may only have one registration.

When initially registering the foreign producer, a third party agent must provide basic identifying information about themselves, including their name, address, phone number, and email address. TTB may also request additional information, if necessary, to verify this individual’s identity. Note that, as part of the registration, the agent must still provide a foreign producer contact that is an employee or owner of the foreign producer. See FAQ FP-3 .

A third party agent registering a foreign producer must have authorization from the foreign producer to provide the required registration information, and perform other actions in the myTTB online system, including editing the foreign producer’s registration information, designating additional persons who are also authorized by the foreign producer to act on the foreign producer’s behalf or canceling the designations of authorized persons, and making assignments of CBMA tax benefits. The agent must maintain proof of their authority to act on behalf of the foreign producer, and be able to provide TTB a copy of the documentation authorizing them to make binding commitments on the foreign producer’s behalf. See FAQ FP-6 for additional information on acceptable proof of authority.

FP-5: How and when is a foreign producer required to update their registration information?

Foreign producers who register with TTB are required to update their registration within 60 days of any change to the information that was required as part of the original registration. In addition, every year, the myTTB system will prompt the foreign producer to either confirm or update the ownership information on file with their registration. If the foreign producer fails to confirm or update its registration information, the foreign producer will not be able to assign CBMA tax benefits until the required action is completed.

FP-6: What does a person acting on behalf of a foreign producer need to have as proof of their authorization?

A person acting on behalf of a foreign producer in TTB’s online foreign producer registration and assignment system must maintain written proof of authorization from that foreign producer to act on that foreign producer’s behalf, and must provide that proof to TTB upon request. Proof of authorization from the foreign producer must include the following:

(1) Name and mailing address of the foreign producer, which must be consistent with the name and mailing address for the foreign producer in TTB’s online foreign producer registration;

(2) Name and mailing address of the person whom the foreign producer is authorizing to act on its behalf;

(3) A clear statement by the foreign producer of the scope of authority granted to the authorized person. The foreign producer can either authorize the person to act on its behalf without limitation, or can limit the authorization to perform only the actions listed below. If the latter, the foreign producer must state that the person is authorized to perform each of the following on the foreign producer’s behalf:

(i) Submit and/or edit the foreign producer’s registration information;

(ii) Assign the foreign producer’s CBMA tax benefits to U.S. importers;

(iii) View all information submitted on behalf of the foreign producer in TTB’s online foreign producer registration and assignment system, including information submitted by other authorized persons;

(iv) Receive and respond to communications from TTB regarding the foreign producer; and

(v) (optional) Designate and/or cancel designations of additional persons to act on the foreign producer’s behalf in TTB’s online registration and assignment system.

The proof of authorization must be signed by an individual with authority to legally bind the foreign producer under the laws of the country where the foreign producer is located. This signing individual must attest that they have authority to grant the authorization and must include their printed name, title, and date of signature on the document.

The proof of authorization must also be signed and dated by the individual receiving the authorization to act on behalf of the foreign producer.

FP-7: Does a foreign producer have to designate an agent?

No. Foreign producers can register themselves and make assignments without an authorized agent. If a foreign producer wants to authorize someone else to act on their behalf, the foreign producer can authorize one or more agents. See FAQ GI-2 for what an authorized agent can do on behalf of a foreign producer and FAQ FP-6 for information on proof of authorization.

FP-8: How many registrations can a foreign producer have?

One. A foreign producer can have only one registration, but can authorize multiple agents to access their registration. ( See the Foreign Producer Registration and Assignment System User Guide for a description of user types and their roles and instructions on designating additional persons to act on a foreign producer’s behalf.) If a foreign producer authorizes multiple agents to act on their behalf, each agent must act under the same registration. See FAQ GI-2 for what an authorized agent can do on behalf of a foreign producer.

FP-9: Can a foreign producer who uses several different importers to import their products authorize each of the importers to act as an agent? If so, can each of the importers/agents register through the foreign producer registration system?

A foreign producer can authorize multiple importers to act as agents on their behalf. However, each foreign producer can have only one registration and all of the agents authorized to act on behalf of the foreign producer must use the same registration. See FAQ GI-2 regarding what an authorized agent can do.

FP-10: When I try to register as a foreign producer, I get an error message that says “Registration Error: Registration Incomplete. Due to a potential error, your registration is not yet complete and you have not been assigned a TTB foreign producer ID. After TTB reviews your submission, TTB will either activate your registration in myTTB or contact you by email with additional guidance.” What does it mean?

This error message indicates that your registration information has been received by TTB but your registration is not successful and needs TTB review. This could be due to a number of reasons, including errors with the FDA ID provided in the registration or when there are potential duplicate registrations. TTB will review your submission and will activate it or contact you by email for additional information. If you receive this error message, you will receive a Submission ID, which cannot be used to assign tax benefits. Your Submission ID may also be found next to the foreign producer’s name when you access the registration submission in TTB’s system. You will receive a TTB Foreign Producer ID only when your registration is successful and active in myTTB.

FP-11: Is there a deadline for getting a TTB Foreign Producer ID?

No, there is no TTB deadline for completing foreign producer registration and getting a TTB Foreign Producer ID. However, a foreign producer must complete its registration and obtain a Foreign Producer ID before it can assign tax benefits to U.S. importers, and – starting in 2023 – there are deadlines for making tax benefit assignments. Foreign producers must make their assignments of tax benefits on or before December 31 of the calendar year for which the benefits apply (see FAQ TB-5 ).

See FAQ TB-3 for information on when a foreign producer may assign tax benefits and FAQ NEW GI-5 for information on imports from foreign producers that have not yet obtained a Foreign Producer ID.

CB-FP12: I work with one or more foreign producers. What happens if I register a foreign producer without their authorization?

Any person who registers a foreign producer must have authorization from that foreign producer and must affirm that they are authorized as part of the registration process. If you cannot provide proof of authorization upon request, TTB will inactivate the registration. Any tax benefit assignments made from a foreign producer account created without authorization are invalid. See FAQ FP-6 for information on proof of authorization.

CB-FP13: What should a foreign producer do if they receive a letter from TTB stating that the foreign producer is a member of a controlled group that has assigned more CBMA tax benefits than is permitted by law?

Foreign producers who receive this type of letter should review the assignments they have made in the Foreign Producer Registration and Assignment System and coordinate with other members of the controlled group to identify the corrections that are needed so that the controlled group as a whole does not exceed the annual CBMA quantity limitations. See FAQ TB-2 for more information about how foreign producers that belong to a controlled group must ensure that their combined CBMA tax benefit assignments do not exceed the quantities allowed by law.

Once the controlled group identifies the assignments that need to be reduced, foreign producers who made those assignments must contact the importers to whom they made the assignments, and instruct those importers to return all or part of the assignment. Importers will return the assigned benefits through myTTB’s CBMA Importer Claims System . For more information on returning assignments, see FAQ TB-4 .

If a foreign producer receives this type of letter but disagrees that they are in a controlled group, or disagrees that their controlled group has assigned more tax benefits than is permitted by law, the foreign producer should submit the Controlled Group Inquiry form and a TTB representative will contact the foreign producer.

NEW CB-FP14: What is the annual Foreign Producer ownership review and how do I complete it?

TTB's temporary regulations at 27 CFR 27.258 require foreign producers who register with TTB to update their registration within 60 days of any change to information required as part of their original registration. To ensure that this information is current, the myTTB Foreign Producer Registration and Assignment System will prompt the foreign producer to either confirm or update their ownership information on an annual basis.

To complete your review: 1. Go to your myTTB dashboard and select Foreign Producer .

2. Review entity information to ensure you are in the correct account. If ownership review is needed, you will see the “Ownership review needed” message box.

2a. If ownership information is correct and no changes are needed, scroll down to the Confirm Ownership section. Read the statement next to the check box and select the box to agree to the statement. Select Confirm owners .

2b. If you need to make changes to your ownership information, select update the registration or Update registration .

3. Once you select Update registration , update the necessary fields on the Foreign Producer Registration page, including the Foreign Producer Ownership section.

4. Scroll down to the Attestation section. Read the statement next to the check box and select the box to agree to the statement. Select Update registration .

CBMA Tax Benefit Assignment FAQs

Tb-1: what are the quantity limitations on a foreign producer’s assignments of cbma tax benefits.

For distilled spirits, reduced tax rates apply to the first 22,230,000 proof gallons of that foreign producer’s product imported into the United States during a calendar year. These rates are, for each foreign producer, $2.70 per proof gallon on the first 100,000 proof gallons imported, and $13.34 per proof gallon on the next 22.13 million proof gallons imported into the United States.

For beer, a reduced tax rate of $16 per barrel applies to the first 6,000,000 barrels produced by that foreign producer and imported into the United States during a calendar year.

For wine, tax credits apply to the first 750,000 wine gallons of that producer’s product imported into the United States during a calendar year. The credits are, for each foreign producer, $1 per wine gallon on the first 30,000 wine gallons of wine imported, 90 cents on the next 100,000 wine gallons imported, and 53.5 cents on the next 620,000 wine gallons imported. The tax credits are available for all wine, except that CBMA provides for adjusted credits for imported wine eligible for the hard cider tax rate (6.2 cents, 5.6 cents, and 3.3 cents, respectively).

A detailed overview of the tax rates and CBMA tax benefits applicable to imported distilled spirits, beer, and wine is available on TTB's ACE CBMA Tax Rates Table .

TB-2: How does common ownership among producers of distilled spirits, wine, or beer affect CBMA tax benefits for imported products?

A foreign producer that is under common ownership with other foreign and/or domestic producers of beer, wine, or distilled spirits are subject to “controlled group” limitations on the quantities of tax benefits that may be assigned when the common ownership creates a “controlled group” under U.S. law. The Internal Revenue Code provides that the quantity limitations for the CBMA tax benefits are applied to the entire controlled group and shall be apportioned among the members of the controlled group. (See 26 U.S.C. 5051(a)(5)(B), 5001(c)(3)(C), and 5041(c)(3).)

For example, if two foreign wineries whose wine is imported into the United States are in a controlled group with each other (e.g., each is wholly owned by the same corporation), the two wineries are treated as if they are one foreign producer for purposes of applying the quantity limitations on the CBMA tax benefits. In other words, their combined CBMA tax benefit assignments to U.S. importers cannot exceed the quantities allowed by law. See FAQ FP-1 .

The principle applies equally to two or more foreign beer producers in a controlled group and to two or more foreign distilled spirits operations that are in a controlled group.

Similarly, if a foreign beer producer whose beer is imported into the United States is in a controlled group with a U.S. beer producer, the beer produced by the foreign members of the controlled group and imported into the United States and the beer produced and removed by all domestic members of the controlled group are treated as if it were the production and removal of one producer for the purpose of applying the quantity limitations on CBMA tax benefits. In other words, if a foreign producer and a domestic producer are part of a controlled group, the combined removals of their beer into U.S. commerce would be subject to one quantitative limit.

The principle applies equally to a foreign producer of wine that is in a controlled group with a domestic producer of wine as well as to a foreign distilled spirits operation that is in a controlled group with a domestic distiller or domestic distilled spirits processor.

TB-3: When may a foreign producer assign CBMA tax benefits?

A foreign producer will be able to electronically assign CBMA tax benefits through myTTB after they have completed their online registration and received a TTB Foreign Producer ID. In most cases, a Foreign Producer ID will be issued within five business days of completing the online registration. However, inaccurate or incomplete registration information may delay issuance of the Foreign Producer ID.

Under the regulations, foreign producers may assign tax benefits for a calendar year starting no earlier than October 1 of the year prior, and all assignments must be made on or before December 31 of the calendar year for which the benefits will apply. Assignments do not all need to be entered at one time. Foreign producers may assign additional CBMA tax benefits as needed until quantity limitations are reached. To illustrate, a foreign producer could assign a portion of the CBMA tax benefits for its products to be imported in calendar year 2024 on October 1, 2023. The foreign producer could continue to assign CBMA tax benefits for 2024, up to the maximum quantity allowed by law, through December 31, 2024.

TB-4: May a foreign producer reduce the quantity of CBMA tax benefits assigned to an importer or reassign CBMA tax benefits to a different importer?

Once the foreign producer has assigned CBMA tax benefits to an importer, the foreign producer cannot reduce the quantity of the assigned tax benefits or reassign the tax benefits unless the importer to whom the tax benefits were assigned first declines the assigned benefits through myTTB’s Importer Claims system. See the Importer Claims User Guide (page 28) for instructions on how to return an assignment.

The importer can decline the quantities assigned in full or in part. Once the importer has declined the assignment, the foreign producer may reassign the declined benefits through myTTB’s Foreign Producer system. All rules that apply to the timing of assignments apply to reassignments. See FAQ TB-3 .

TB-5: When is the deadline for making assignments?

All assignments for a calendar year must be made by the end of that calendar year. For example, all assignments for 2023 must be made on or before December 31, 2023.

TB-6: Why doesn’t the foreign producer system allow me to assign the maximum quantity of CBMA tax benefits to each of the U.S. importers that import my products?

Each foreign producer has a limited quantity of CBMA tax benefits that they may assign to one or more importers. See FAQ TB-1 for the quantity limitations. The quantity limitation applies to the foreign producer, and it is the maximum quantity that the foreign producer can assign in total. The foreign producer can assign their total quantity of tax benefits to one importer or divide it among multiple importers. All of the foreign producer’s assignments cannot exceed the total quantity of benefits the foreign producer is allowed. The system does not allow a foreign producer to assign, in total, more than the maximum tax benefit the law allows for a foreign producer.

The quantities that a foreign producer can assign may be further limited by common ownership among producers of distilled spirits, wine, or beer. See FAQ TB-2 for an explanation of how common ownership among producers affects CBMA tax benefits. It is the foreign producer’s responsibility to determine their eligibility for CBMA tax benefits in situations where they share ownership with other producers.

TB-7: I am trying to assign tax benefits for wine or beer, but I only see the option for the distilled spirits category. Why is this happening and how do I fix it?

During foreign producer registration, foreign producers must provide an FDA ID or certify, by checking the box shown in the image below, that they do not have an FDA ID because they only produce industrial alcohol. When a foreign producer checks this box, it indicates that they only produce industrial alcohol and the system will only allow them to make assignments for distilled spirits.

If a foreign producer has checked this box in error and limited their account to only distilled spirits assignments, the foreign producer will need to update their registration by unchecking the box shown above, and by providing the appropriate FDA ID(s) as required by TTB’s regulations. See FAQ FP-2 .

TB-8: I pay another company to produce and bottle all of my distilled spirits, wine, or beer for me at their facility. May I assign tax benefits for those products?

No, in this situation the other company is the foreign producer, even if your brand name appears on the labels of the finished products. The other company can register with TTB and make assignments for the distilled spirits, wine, or beer that it produced, including quantities produced under contract with you.

TB-9: May a foreign producer increase the quantity of a CBMA tax benefit assignment made to an importer or importers?

Yes, a foreign producer may increase the quantity of an assignment, up to the limits set by law (see FAQ TB-1 for information on those limits). For step-by-step instructions on increasing an assignment quantity, see Step 4 in the Foreign Producer Registration and Assignment System User Guide .

Note: Foreign producers cannot have more than one assignment with the same importer permit number, calendar year, product category, and tax benefit tier. Instead, the foreign producer will be required to increase the existing assignment to the importer for that calendar year, product category, and tax benefit tier.

For information on how tax benefits can be reassigned after an assignment is returned in whole or in part by an importer, see FAQ TB-4 .

CB-TB10: What happens if a foreign producer does not assign all of their benefits by the end of the calendar year?

If a foreign producer does not assign all of their calendar year tax benefits by the end of that calendar year, they will not have an opportunity in future years to assign those unused tax benefits. By law, each foreign producer may assign a limited quantity of tax benefits for each category of their products imported into the United States (beer, wine, or distilled spirits) during a calendar year. These benefits do not carry over from one calendar year to the next. TTB regulations require that assignments be submitted on or before December 31 of the calendar year for which the CBMA tax benefits are assigned.

NEW CB-TB11: What businesses can register with TTB as foreign producers and assign tax benefits?

TTB regulations define the “foreign producer” who can make CBMA tax benefit assignments as the “foreign distilled spirits operation, wine producer, or brewer.” For CBMA purposes, these terms have the following meanings:

Foreign wine producer: A foreign entity that produces wine through fermentation or through sweetening, amelioration, the addition of wine spirits, flavoring, or carbonation. A foreign entity that purchases wine in bulk for blending and/or bottling but does not perform any of the production activities listed in the previous sentence may not assign CBMA tax benefits for that wine.
Foreign brewer: A foreign entity that brews beer through fermentation or produces beer by the addition of water or other liquids during the production process. A foreign entity that purchases beer in bulk for blending and/or bottling but does not perform any of the production activities listed in the previous sentence may not assign CBMA tax benefits for that beer.
Foreign distilled spirits operation: A foreign entity that produces distilled spirits through distillation. A foreign entity that purchases distilled spirits in bulk for blending, flavoring, and/or bottling may not assign CBMA tax benefits for those distilled spirits. See 26 U.S.C. 5001(c)(3)(B)(i)(I) (limiting the assignment of the tax benefits to the number of proof gallons produced by a distilled spirits operation).

See also TB-8 , explaining that an entity’s brand name on distilled spirits, wine, or beer, does not make that entity the foreign producer for CBMA purposes.

Please send your questions about tax benefits for imports under CBMA using the National Revenue Center Contact Form (choose CBMA in the drop down).

To reach us by phone from 8 a.m. to 5 p.m. EST, Monday through Friday, call 1-877-882-3277, option #3.

Last updated: April 10, 2024

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