Most home contractors are honest, but history shows us that crooked contractors almost always show up at disaster areas to offer low-priced, fraudulent repairs. These are often unlicensed storm-chasers, going door-to-door in search of victims. The New York Alliance Against Insurance Fraud (NYAAIF) offers tips to protect yourself and your family.
Most home contractors are honest, but history shows us that crooked contractors almost always show up at disaster areas to offer low-priced, fraudulent repairs. These are often unlicensed storm-chasers, going door-to-door in search of victims.
Devastated communities trying to get back on their feet after monster megastorm Sandy may have another reason for worry -- crooked contractors exploiting the disaster to make a quick buck at homeowners' expense, warns the New York Alliance Against Insurance Fraud (NYAAIF).
"New Yorkers are hurting after the storm; we've been pummeled with a deadly mix of rain, high winds and flooding," says NYAAIF chairman Jack Houston. "As we pick up the pieces after the disaster, we must stay alert for contractors who try to profit from our vulnerability."
New Yorkers should work closely with their insurance companies to help avoid home repair scams. Call the police if you're confronted by contractors who show any of these red flags:
- Knock on your door and offers free repairs, offering to cover the insurance deductible.
- Demand a large downpayment. The contractor may disappear with your money and leave the work unfinished.
- Ask to inspect the property, then cause more damage in order to inflate their price: enlarging a hole in the roof, or creating fake damage.
- Offer suspiciously low prices, these may use lower-grade material or fail to insure their workers against injury. Check for price ranges by calling your insurance company.
- Want to estimate your damage and cost themselves rather than ask your insurance adjuster to estimate a reliable quote.
When choosing a contractor for repairs, New Yorkers should take these steps to protect themselves:
- Ask your insurance company for established contractors
- Avoid contractors who knock on your door unannounced
- Consult with your insurance company before making repairs
- Pay by check or credit, and don't pay cash
- Pay no more than 20 percent upfront
- Ensure the contractor is licensed
- Ask for a signed contract before work begins, detailing materials used, and schedule of repairs
Homeowners should keep in mind that insurance policies may not cover fraudulent repairs. This could leave homeowners to pay expensive repair bills on their own.
"These scammers are going to go after New Yorkers when they're hurting most, so knowing the signs is the first and best line of defense," Houston says. "You've got to know it to stop it."
Visit fraudny.com for more info.
The New York Alliance Against Insurance Fraud is a non-profit organization that seeks to increase public awareness about insurance fraud and its consequences. Membership includes more than 100 insurance companies writing policies in New York State.