Sandy is gone, but she has carved out massive damage that will take months to repair.
Now that cleanup is beginning, homeowners in affected areas must increase their vigilance for scam artists who inevitably follow natural disasters.
Sandy may be the one of most expensive storms in recent history. Contractors will be in great demand as the repair network gets stretched to the limit. Shady operators inevitably will descend on disaster areas, trying to bilk homeowners and their insurers.
These crooks prey on the disaster scene’s chaos and anxiety of consumers as they work to put their lives back together. Fraud fighters, consumer groups, insurers and government agencies must get important messages onto the streets.
• Make sure a contractor is licensed, if required. And if not, check with the proper agencies and insurers to make sure the contractor is reputable;
• Avoid contractors who go door-to-door. They’re almost always up to no good; and
• Work closely with your insurance company to make sure the right repairs are done, and done right.
Megastorms like Sandy also should prompt lawmakers to better protect disaster victims from dishonest contractors. A half-dozen states this year enacted laws giving homeowners more protection from storm chasers.
Here are key contractor laws that should go on the books in more states:
• Let consumers cancel repair contracts if the property insurer denies the claim. This protects consumers from contractors who try to con insurers into paying for repairs that are shoddy, needless, inflated or never even done;
• Contract forms also should clearly mention the consumer’s recision rights. And that it’s a crime for the contractor to offer consumers inducements (such as paying the deductible) to sign up, or for the contractor to act as an intermediary between the consumer and the insurer (i.e., an unlicensed adjuster); and
• Require contractors to register with the state. Registration is not a state license, but will help ensure that a state knows which contractors are doing business within its borders.
The floodwaters now are subsiding, but next may come a riptide of fraud. We must be ready.
About the author: Howard Goldblatt is director of government affairs for the Coalition Against Insurance Fraud.