During disasters, people can, unfortunately, fall victim to various forms of fraud and abuse. While most contractors are honest and reputable, others are not. These fraudsters will often make false promises, insist on full payment upfront before work is completed and sometimes even create damage where none occurred.
As homeowners begin seeking help to clean up and repair storm damage, it is important to be cautious when hiring the contractors. Below are some tips on how to protect yourself from becoming a further victim after an initial disaster strikes.
- Look for well-established, licensed, insured and bonded professionals with a federal tax identification number and a permanent address.
- Ask for a contractor’s license number and confirm with your city or county building department that the license number was issued by them and is current.
- Check online with the South Carolina Secretary of State’s office to make sure the contractor is registered to conduct business in South Carolina.
- Ask to see the company’s certificates of insurance. Verify with the insurer the certificate is valid, the contractor is endorsed for the work and that the contractor’s coverage for liability and workers’ compensation is current. It also advised to check the number of employees covered by the policy. For example, if the work involves a new roof, a low number of covered employees indicates the contractor will hire temporary help who may or may not have roofing experience.
- Don’t hire a contractor who knocks on your door following a storm. Most legitimate roofing contractors do not conduct business this way.
- Contact the South Carolina Contractor's Licensing Board for a current list of licensed, properly insured and professional contractors.
- Contact the Better Business Bureau to check for complaints filed against any company you are considering hiring.
- Always get at least three written, itemized estimates or bids on repairs.
- Require references that specifically include other homes in your area, and check them.
- Make sure you review and understand all documents sent to your insurance carrier.
- Never pay a contractor in full or sign a completion certificate until all the work is completed.
- Don’t be pushed into signing a contract right away. Never sign a contract with blanks or statements like “See insurance estimate, etc.” Fraudulent contractors may enter unacceptable terms later.
- Always inspect the work and make sure you’re satisfied before you pay.
After suffering storm damage, the last thing you need is to be ripped off by a fraudulent contractor. As your insurance company, we are committed to helping the claims process go smoothly and can serve as a resource for recommendations on reputable contractors.
To learn more about avoiding contractor fraud and abuse, visit Property Casualty Insurers Association of America’s contractor fraud and abuse digital interactive guide.