Here in the Pacific Northwest, we are able to avoid most of the major disasters. Hurricanes don't care for our climate and the tornadoes stay far away. We face flooding and the eventual threat of an earthquake. But in places where disasters have struck - Oklahoma or the Jersey Shore - the need to rebuild quickly is abundant. And when there are people in emotional distress and dishonest people trying to turn a profit, fraud can be a major problem.
The National Insurance Crime Bureau (NICB) studies fraud throughout the insurance industry. In the wake of natural disasters, they often publicize the need to look out for Disaster Fraud. After every disaster, homeowners are paid thousands of dollars to put their lives back together, and scam artists are great at figuring out how to take that money at the greatest profit. From unlicensed contractors who use shoddy materials, to others who encourage the fabrication of insurance claims, and salespeople who convince you to fix things were unaffected by the disaster. While many of the people who go door-to-door after a disaster offering help and services are reputable, there are those that are not so scrupulous. They may take your money and run, use inferior materials or repair your home in a way that doesn't meet building codes. And it's not uncommon - after Hurricane Katrina more than 26,000 fraud complaints were filed.
So while you may not be able to avoid becoming the victim of a natural disaster. you can get smart about those people that could be taking advantage of you. The NICB recommends taking the following into consideration when a contractor offers you services...and these tips can help you tell the difference between a legitimate contractor and an imposter.
- Work only with licensed and insured contractors.
- Get multiple estimates. If you experience a "hard sell" or are being pushed into signing right away, you should step back and get other opinions.
- Get everything in writing. Cost, the work that will be done, what the schedule for completion can be, what your expectation for quality and guarantee of work should be, payment schedule and anything that could be considered a "gray area" if something goes wrong.
- Require references, and be sure to actually check them out.
- Ask to see the salesperson's driver's license, and write down the number. If you can, try to jot down the license plate number of the vehicle they're driving.
- Never, never sign a contract with blanks. Fraudulent contractors may enter different terms and conditions into those blanks than what you originally agreed upon. These types of things will rarely break in your favor.
- Never pay a contractor in full or sign a completion certificate until the work is finished.
- A catastrophe is a great time for fraud and abuse. Don't give into temptations to conspire in insurance fraud. It's a felony. And your policy can be rendered void if you decide to misrepresent something to the company.
If you are ever in a situation where things don't quite feel right when discussing terms with a contractor, feel free to step away. If your gut is telling you things aren't quite right, then that may be true. And it's always better to do your due diligence and be sure than to proceed through a repair with a nagging worry. For more information about disaster fraud, visit the National Insurance Crime Bureau at www.nicb.org.