Avoid Becoming a Storm Victim Twice

Unscrupulous Contractors and Fraudsters Trying to Unload Flood-Damaged Vehicles Prey on Unsuspecting Consumers

DES PLAINES, Ill., July 28, 2020 — As Hurricane Hanna leaves a path of destruction in its wake, homeowners are left with the unenviable task of putting their lives back together. The National Insurance Crime Bureau (NICB) warns everyone to avoid being victimized a second time by deceitful roofers or contractors who come out of the woodwork and others trying to unload their flood-damaged vehicles at a great price. 

After disasters, homeowners may be pressed into signing a contract and paying out their insurance claim money or their own savings to a contractor who may take the money and run or do minimal or shoddy repairs, leaving the property owner holding the bag.

A recently passed law in Texas also closed a loophole making it illegal for illegitimate contractors to promise homeowners they can waive their deductible. The law, supported by NICB, protects consumers from certain roofing contractors, public adjusters, and plaintiff attorneys who mislead storm victims and promise big payouts without any costs.

“Almost all disaster repair scams are unsolicited—they begin with a visit from a contractor who seeks to help victims rebuild,” said Fred Lohmann, director of field operations, Southwest Region of the National Insurance Crime Bureau. “Before hiring any contractor, call your insurance company. There is no need to rush into an agreement with a contractor who solicits your repair work—especially when you did not request it.”

NICB suggests you consider these tips before hiring a contractor:

• Get more than one estimate.
• Get everything in writing. Cost, work to be done, time schedules, guarantees, payment schedules and other expectations should be detailed.
• Demand references and check them out.
• Ask to see the salesperson’s driver’s license and write down the license number and their vehicle’s license plate number.
• Never sign a contract with blanks; unacceptable terms can be added later.
• Never pay a contractor in full or sign a completion certificate until the work is finished and ensure reconstruction is up to current code.
• Make sure you review and understand all documents sent to your insurance carrier.
• Never let a contractor pressure you into hiring them.
• Never let a contractor interpret the insurance policy language.
• Never let a contractor discourage you from contacting your insurance company.

Homeowners are not alone when it comes to fraud after a storm. As floodwaters recede, many flood-damaged vehicles emerge providing an opportunity for fraudsters to prey on innocent used car buyers. NICB encourages purchasers to do their homework. To that end, NICB provides a free, useful tool called VINCheck that allows consumers to check a vehicle for a “red flag” such as theft, accident damage or written off as a total loss.

Dishonest dealers and other individuals can buy flooded vehicles, dry and clean them and sell them to unsuspecting buyers as used vehicles. Many of these vehicles come on the market after natural disasters. If you are shopping for a used vehicle, NICB recommends checking a few items that could indicate whether the vehicle is a flood recovery vehicle or not. Some steps to follow are:

• Buy from a reputable car dealer.
• Check the car thoroughly looking for water stains, mildew, sand and silt under the carpets, headliner and behind the dashboard. 
• Look under the hood for signs of oxidation. Pull back the rubber “boots” around electrical and mechanical connections for these indicators. Ferrous (containing iron) materials will show signs of rust; copper will show a green patina; aluminum and alloys will have a white powder and pitting.