Assignment of Benefits (AOB)

Definition - What does Assignment of Benefits (AOB) mean?

Assignment of benefits (AOB) is the official way an insured person asks their insurance company to pay a professional or facility for services rendered.

Insuranceopedia explains Assignment of Benefits (AOB)

Assignment of benefits is a document that directs payment to a third party at the insured's request. It becomes legitimate once both the insured party and their insurer have signed the AOB form. AOB is used in a number of insurance contexts, such as paying physicians or clinics through health insurance or paying contractors for repairs through a homeowner's insurance policy.

Usually, AOBs are issued when the third party pursues it in the hopes that payment from the insurance company will be more certain and delivered more quickly than it would be from the insured.

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