If your home or business suffered damage during the recent east coast earthquake, Hurricane Irene or flooding from tropical storm Lee, then you are probably in the process of scheduling repairs. The Federal Emergency Management Agency (FEMA) warns to be careful when choosing contractors for repair jobs or you might find yourself a victim all over again.
Be suspicious of those who claim to be contractors and who seek jobs by going door-to-door or handing out flyers. Furthermore, be wary of those who require large up-front deposits or payment in full in advance. If they turn out to be unscrupulous, they will likely begin the job but then disappear before the work is done.
The Insurance Information Institute also cautions to be very careful if a contractor proposes doing temporary repairs at a large cost before getting on with the permanent repairs. Bear in mind that the insurance settlement you receive is typically intended to cover both initial temporary repairs if/as necessary as well as permanent repairs for a given loss. If you spend a lot of your funds on such a temporary fix, you will likely not have enough remaining to cover the permanent repair job.
See more advice from III: Beware Crooked Contractors (Video).
Before you sign any contract to have repair work done, be sure that you feel completely confortable that you are working with a reputable, honest contractor. If possible, work with a contractor who has done work for you or someone else you trust. If you don’t know such a contractor, try asking your insurance agent who will likely be able to refer someone who is reliable. Likewise, your local building/trade associations might make a referral. But you will want to check references if it is someone you don’t already know.
Whether you are the victim of a disaster or just a home or business owner with property in need of repairs, if you will be working with contractors, consider the following tips:
- Look into the contractor’s reputation with the local builder/trade organizations or the Better Business Bureau. In particular, you’ll want to know whether the contractor’s record shows complaints filed.
- Get a Certificate of Insurance from the contractor to be sure that the firm has active disability and workers' compensation insurance to cover any workers’ accidents. Otherwise, you could be liable for such accidents on your property.
- Ask for a written estimate that includes all the work you expect the contractor to do. It should also show taxes or other fees. Be aware that you may be charged for the estimate, especially since the contractor is likely to be very busy after a disaster has occurred.
- Be sure you know who is responsible for obtaining all permits and licenses related to your job.
- Obtain a written contract that specifically shows all tasks to be performed, all associated costs and payment schedule; and don’t sign a contract that is not specific and complete.
- Ask for a written guarantee with a stated duration showing exactly what is guaranteed and whether there are any stipulations or restrictions.
- Pay by check or credit card but never by cash.
- Be sure to read carefully any contract cancellation clauses. You should be able to cancel a contract within three business days of signing.
If you have a loss due to storm damage or something else, be sure to contact your insurance agent as soon as possible to discuss your options and receive assistance. Here at Henry A. Latimer & Son, we are experienced in helping our insurance policyholders recover from losses with as little discomfort as possible. Please contact us at your convenience to discuss any of your insurance needs.