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5 tips for avoiding post-Irene insurance scams
Now that Hurricane Irene has come and gone, home insurance companies are warning of another threat to battered East Coast homeowners: scam artists.
Out to make a quick buck, shady contractors prey on vulnerable disaster victims by offering to do repairs and cleanup services but then failing to show up or complete projects after they receive payment for the work.
"We call them fly-by-night storm chasers," says Roger Morris, spokesperson for the National Insurance Crime Bureau (NICB). "They come in and descend on a neighborhood. You write a check, and you never see them again."
Home insurance claim scams
Typically, these types of scams begin with an unsolicited visit from a so-called contractor offering his or her services. Morris says to keep in mind the bureau's advice: "If you didn't request it, reject it."
Some scam artists demand upfront payments for materials and then skip town without doing a lick of work. Others never return to the job, or they use cheap, inferior materials and perform shoddy work that's not up to code so they can make more profit. Some con artists offer to inspect the property and then actually inflict damage, Morris says, particularly on roofs where they can operate unobserved by homeowners.
"If they pressure you to sign a contract or pressure you to give a deposit, don't do it," Morris says.
If your property was damaged by the hurricane, you should contact your insurance company before speaking with any contractors. The insurer will help guide you through the process and can steer you to reputable contractors, Morris says
Here are five more tips from NICB to consider before hiring a contractor:
• Get more than one for major repair work. Be wary if one of the bids is significantly lower than the others.
• Check out the contractor. Make sure the contractor is licensed to do work in your state and has an established business in your state. Ask for and check contractors' references. Ask to see the sales person's driver's license, advises NICB. Write down the person’s license number and the vehicle license plate number.
• Work closely with your car and home insurance companies. Review and make sure you understand all documents from your insurer. Don't let a contractor interpret the insurance policy for you or discourage you from contacting your insurer, says Morris.
• Never pay a contractor in full or sign a completion certificate until all the work is finished. Make sure reconstruction is up to current codes, recommends NICB.
• Get everything in writing -- cost, work to be completed, schedules, guarantees, type and quality of materials to be used, how and when payments are to be made and other expectations. Don't sign a contract with blanks, which leave space for unacceptable terms to be added later.
If you think you've been approached by a disreputable contractor or unscrupulous adjuster, or have been encouraged to falsify an insurance claim, contact your insurance company or call the NICB hotline at 1-800-TEL-NICB (800-835-6422). You can also file complaints about contractors with your state's attorney general or state agency that oversees contractor licensing.
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