New Wis. Law Targets ‘Storm Chasers’
By Karen Rivedal, The Wisconsin State Journal | |
McClatchy-Tribune Information Services |
But a new state law intended to protect against fly-by-night fraudsters in the home improvement sector, dubbed "storm chasers" by state consumer advocates, may help weed out the chaff as residents try to hire help to repair damaged homes, farms and businesses.
Suspect tactics include pressuring homeowners for a down payment, increasing the price of a job in the final payment, or offering a suspiciously low upfront price -- perhaps because a company intends to take off before even starting the work, state officials said Friday.
"Every year, we hear from consumers who have been ripped off by storm chasers," said
Along with a homeowner's due diligence, the new law is described as giving Chalmers' agency new enforcement tools to protect property owners and prevent insurance fraud.
New prohibitions and requirements include:
--Contractors can't promise to pay all or some of a homeowner's property insurance deductible.
--Contractors can't represent or negotiate with the homeowner's insurer on behalf of the customer. The contractor can, with the consent of the customer, discuss damages, repairs and costs associated with the work with the insurer.
--Before entering into a contract, the contractor must provide a questionnaire to determine if the work requested is related to an insurance claim.
--Customers can cancel the contract within three business days of finding out their insurer has denied all or any part of their claim for the work.
--Contractors must notify customers of this right.
Chalmers said it's no accident that some of the law's provisions appear to be about protecting insurance companies at least as much as homeowners.
"There are already laws protecting consumers against theft and (businesses) making false and misleading statements," Chalmers said, maintaining the new law instead focuses heavily on insurance issues in part as another way to achieve consumer protections.
"It sets new parameters for an honest transaction between contractors and homeowners, especially with regard to insurance, because that was an area that had been unaddressed and which these storm chasers had taken advantage of to try to get business," she said.
For instance, offering to pay a homeowner's insurance deductible has been used "to entice homeowners into signing a contract quickly," Chalmers said. "It's a misrepresentation in many cases, and it just gives us another violation to charge these criminals with."
Chalmers also noted the storm chasers law does give homeowners a new right to cancel home improvement contracts, effectively expanding the existing right to cancel any business transaction within three days.
State consumer protection officials also offered a list of best practices for homeowners to keep in mind that may help them avoid bad contractors in the first place:
--Be wary of contractors who knock at your door. Call the police or sheriff's department to check them out.
--Hire a contractor based on referrals from friends and neighbors, and ask contractors for references. Residents also can contact state consumer advocates to see if complaints have been filed against any business.
--Selecting local companies may be best, and be careful if local contractors use outside subcontractors.
--Get lien waivers from anyone you pay for home repairs. Lien waivers protect property owners if contractors don't pay their suppliers or workers.
--Get a written contract with a start and completion date and with warranty information, and be sure it says exactly what work will be done and what materials will be used. Don't ever rely on verbal commitments.
--Contractors registered with the state are issued a card indicating that. Ask to see it.
--Have someone watch the work while it's being done, and check with local building inspectors yourself to determine if the work requires a permit. Make sure an inspector sees the work before making a final payment.
--Ask for a copy of the contractor's certificate of liability insurance.
___
(c)2014 The Wisconsin State Journal (Madison, Wis.)
Visit The Wisconsin State Journal (Madison, Wis.) at www.wisconsinstatejournal.com
Distributed by MCT Information Services
Wordcount: | 703 |
Therapeutic Riding Association faces funding crisis
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News