INSURANCE - SCAM

Insurance Roofing Scams and How They Affect Everyone.

We have all had our share of bad weather in recent years. Hurricanes, hail and high winds caused damage to the roofs of many homes and businesses. Many of those claims were legitimate claims. However, some were not. After storms, predators swarm, driving trucks that literally say, “Free Roof” on the side of their vehicle. Perhaps you have had someone knock on your door and say, “Did you know you have some roof damage? We can fix this for you and we’ll pay your insurance deductible so it won’t cost you a penny.”

These offers can be tempting, especially if it is time for a new roof anyway. BEWARE! These are, more often than not, scams. The word “free” sometimes causes people to forget the old adage; “If it sounds too good to be true, it probably is.” If the unscrupulous roofing contractor sees that the word “free” is not working, they may use fear. They will exaggerate the damage and the potential problems to scare a homeowner into a new roof.

You can go to jail, lose your coverage, get scammed out of the insurance check, or get sued by your insurance company for reimbursement of the claim (which could be double of the actual cost, remember they jack up the price to cover your deductible). Roofing scams are illegal. Not only can the contractor go to jail, but so can you. What can you do to avoid roofing scams? Here are some red flags:

• The most obvious, if you are offered a free roof. If you participate in a scam, not only can the unscrupulous contractor face criminal penalties, but you can as well. Discounting deductibles and waiving deductibles are all against the law.
• If someone knocks on your door stating you have roof damage. Most of the time they will be well dressed. They are paid a percentage by the contractor when they sell a new roof.
• If the contractor’s vehicle has advertising stating, “free roof.”
• If you're asked to provide "X" amount of referrals to receive your deductible paid for. You are doing their dirty work and providing more bogus claims of roofs they haven't inspected. Holding you liable as the point of contact.
• If a contractor urges you to sign a contract. Seek estimates and other advice from other contractors and ask for references.
• If the contractor demands an upfront payment and promises you will be reimbursed at a later time.
• Check out the business with the Better Business Bureau. Many of these contractors are not legitimate businesses. They are simply “created” after a storm. Many may not even be from your home state.
• If you find a brochure at your home stating you have roof damage and directs you to call them.
• Ask for a copy of their “Certificate of Insurance”. If they will not provide this to you, that’s a red flag. If someone is hurt on your property and they are not insured with workers’ compensation insurance, you will be paying for that injury. If they do not have general liability, you have no recourse if damage is caused by their work.

Roofing scams affect everyone – even those who did not take advantage of a “free roof.” Not only will the victim’s insurance premiums increase, but so will everyone else’s. The more claims in a particular area of town, the more that area will pay in homeowner’s insurance premiums.

According to an update published by the Florida Justice Reform Institute (FJRI), “the prospect of one-way attorney’s fees has encouraged a growing number of lawyers to partner with various service providers to solicit assignments of benefits from policyholders.”

“The one-way fee is meant to benefit the homeowner, not the vendor,” FJRI President William Large told the Florida Record.

Typically, Large said the insurance company will contact the homeowner when an inflated claim is filed by a third-party vendor. He said the insurance company will ask why the larger claim amount was filed.

“They say 'the homeowner told me to do this,'” Large said. “The homeowner is often an innocent pawn.”

According to data from the Department of Financial Services’ Service of Process (SOP) database, Florida’s population grew by 26 percent between the years of 2000 to 2016, but the number of lawsuits filed against insurance companies in that same time period jumped about 280 percent.

“Litigation involving AOBs is unique in that it is abundant, yet derives from a very small set of attorneys, law firms, and vendors,” the FJRI said in its update.

Don’t be a victim or a willing participant in roofing scams. The risk is too great.