As more natural disasters take place around the world — hurricanes, wildfires, tornadoes — producing great losses and leaving behind broken homes and lives. Even worse is that if we’re not cautious,
the events after the storm can be just as harmful as the natural disaster itself. A few areas to be extra careful:
Shady contractors are a species that you need to be wary of. These contractors show up at a property that’s been affected by a hurricane or other disaster event and offer to take care of immediate emergency repairs. They tell the homeowner that all they need to do is sign some paperwork and the insurance company will pay for the repairs.
In fact, they’re only interested in their own benefit—if you live in Florida, they might give you to sign a document called “assignment of benefits” (AOB) that gives the contractor the right to receive payouts from your insurance company directly for repairs.
These contractors will make minimal or no repairs to the person’s home at all, but they’ll file a large claim with the insurance company nonetheless. Some of them are lucky and get the insurance payout and then skip town. In the meantime, your home is still destroyed, and there’s no one to help you fix it. Another related scenario is that in which the contractor will do unnecessary repair work, bills the insurance company, they pay, and the shady contractor never finishes the work on different pretexts.
There are countless scams out there, that is why it is vital that you talk to your insurance agent before signing anything. Red flags like demanding large repair deposit up front, or pressuring you into signing an AOB, should immediately show you their true colors. Whatever they might say, remember to call your insurer. Most insurers will dispatch approved companies to complete emergency repairs, and that will keep you in control of your insurance policy. Stay safe!
