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Bobbie Sage

Warning: Contractor Scams

By August 20, 2010

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This recently happened in Ohio but could happen to anyone in any state. According to www.10tv.com, "Employees from the Ohio Department of Insurance on Thursday were warning homeowners to be wary of contractors looking to profit after a recent storm. Neighbors in Pennell's neighborhood were warned to be wary of door-knocking roofing companies, especially those that want to climb up on the roof for a closer look, Ludlow reported."

Apparently these so called "roofing companies" were going up on the roof and damaging it themselves to show the homeowner there was damage. Then, they agree to do the work and have the homeowners insurance company pay. And of course the work would not be done and the money was not returned to the homeowners.

When it comes time to file your homeowners insurance claim, it is important to find a fair and reputable contractor. Here are some tips to help you hire a reputable contractor for your insurance claim.

Comments
August 22, 2010 at 2:11 pm
(1) AF53 says:

Bobbie:

The Story is a nice read although I have to comment on letting the adjuster write an estimate and using that as a guide to hire a contractor. I have been an insurance project estimator for 8 years and have worked as a consultant for many major carriers. I have written millions of dollars worth of estimates and had to back up much if it with the contract for the restoration.

This is what I have found:
The bulk of insurance adjusters are poorly equipped and trained to write property damage estimates. Adjuster written estimates are typically under scoped, underpriced and too heavily dependent on “set” line item prices provided by their estimating software and “guidelines” set by the carriers they work for. This problem is even more prevalent during “CAT” events when the insurance companies seem run out of adjuster resources.

The best adjusters (and the carriers they work for) recognize that property damage estimates should be written by restoration professionals and backed up by the general contractors they work for.

Many “Estimators” are not much better than the adjusters.The best estimators are experienced construction people trained in fire and water damage restoration and experienced with industry standard estimating software.

The estimate needs to take into account the complete process and not just be an inventory of the damaged items. It should not only provide an amount for compensation but act as a set of instructions for the project.

Unfortunately the competence, the state of mind, the schedule and all the human factors you can think of will affect the quality, even integrity of the final estimate, no matter who writes it. The amount can vary based on the size and even profit requirements of the contractor. Adding a public adjuster to mix can be useful or destructive depending on the situation and the players involved.

Insurance estimating software like Xactimate levels the field to some degree. Too often, however, insurance company policies don’t allow for variations needed to compensate for non standard items either in labor or material and/or the “professionals” using it just plain don’t know how to use it properly.

As a property owner (who has had to make damage claims) and as a restoration professional, I have seen many sides of this issue and am personally unable to make a blanket recommendation other than: Find someone who is really good at writing estimates for insurance losses, who will be able to settle to the loss with the insurance carrier for you, and will back up the estimate with quality contracting.

And good luck!

AF53

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