Beware of storm scammers

In many areas of the country, climate change is bringing violent winds, flooding rain, hailstorms, tornadoes, and more. A good insurance policy may help you feel confident you’re prepared for storm season, but there’s another after-effect of extreme weather: after-storm scammers.

These are fly-by-night operators who descend right after disaster has struck. They arrive with stacks of business cards, slick four-color brochures, and high-pressure sales tactics, promising that they can take care of all the estimates, underbid all competitors, and negotiate with your insurance carrier for the optimum payout on your claim. All you have to do is sign on the dotted line.

Don’t do it. Or at least wait until you’ve done some due diligence.

First, call your insurance company. Their adjuster will survey the damage and provide you with some numbers. If you don’t call their representative to do a careful inspection before repairs begin, your claim could be denied, and you could end up paying out-of-pocket for work you’ve signed for.
Go local. Identify contractors based in your area, ideally in your town. But beware: some shady operators will come into storm-ravaged towns from out-of-state, find a short-term storefront rental, and call themselves “local.” That storefront will be empty the minute the work dries up.
Get multiple bids. Even if you know the contractor, ask for bids from other local firms. Ask to see examples of projects they’ve completed and talk to the homeowners personally.
Match apples with apples. Comparing bids, you may turn up a discrepancy, a specification for inferior materials, or vendors who will charge inflated prices. The low bid may have left out some important considerations which, when accounted for in the project, will jack up the price exponentially.
Don’t take anyone’s word. Get everything in writing. A printed good faith estimate of the scope and timing of your project will give you something you can check against the work that actually gets performed, the materials that actually get used, and the promised schedule.
Check all contractors’ licenses and memberships. When you think you’ve found the firm you want to go with, ask a few pointed questions. Do they have the permits in your locale to do the work you need done? Do they belong to any reputable industry associations? Some associations have training and certification programs their members must use before they get a stamp of approval. Shady operators don’t bother; that alone is a reason not to use them.
Are they bonded or insured? If a contractor is bonded, it means a third-party company has backed them, which puts the surety company on the hook for debt, default, or project failure. When a contractor is Insured, they’ve paid a premium for a policy covering certain claims and accidents on your jobsite. While they’re not quite interchangeable, they add up to a similar level of protection for homeowners. Again, ask to see it in writing.
Before you sign anything, check the Better Business Bureau’s website. If you discover the contractor has an open BBB file with a passel of complaints, you’ll have dodged a bullet.
Read the contract. Don’t give in to the temptation just to scan the document the contractor hands you for your signature. Go over the scope of work with a fine-toothed comb. Make sure it covers cost, time schedules, payment terms, and guarantees.
Pay with a check or credit card. This gives you the power to stop payment in the event your contractor begins to act shady. Never pay upfront, pay in full, or sign a completion-of-work certification until you’re fully satisfied that the work is done, done right, and in compliance with local building codes.

Sources: Forbes Advisor; Angi.com

The information included here was obtained from sources believed to be reliable, however Grinnell Mutual Reinsurance Company and its employees make no guarantee of results and assume no liability in connection with any training, materials, suggestions, or information provided. It is the user’s responsibility to confirm compliance with any applicable local, state, or federal regulations. Information obtained from or via Grinnell Mutual Reinsurance Company should not be used as the basis for legal advice or other advice but should be confirmed with alternative sources.

4/2024