BIRMINGHAM, Alabama -- Just days after the worst tornado outbreak in recorded Alabama history, scam artists and unscrupulous contractors have begun trying to take advantage of surviving victims.
While most contractors are legitimate, major disasters attract "storm chasers" who follow in catastrophe's wake. Insurance companies now are getting reports of scams and questionable business practices, said David Colmans, director of the Alabama Insurance Information Service trade group.
Insurers have gotten reports of questionable roof repairs and of questionable contractors going door-to-door.
"Any time after a storm like this, it starts almost immediately," Colmans said. "We're already getting reports of hail guys," or unscrupulous contractors who perform unnecessary roof repairs.
Insurance scams, including needless repairs such as unnecessary total roof replacements, cost the industry and consumers about $30 billion a year, according to the National Insurance Crime Bureau.
• Consult your insurance company before allowing a contractor to perform work he's said will be covered by your insurance.
• Ask to see the credentials of anyone who claims to represent your insurance company.
• Be suspicious of contractors who approach you unsolicited.
• Ask for proof that your contractor has both liability and workers compensation insurance, and ask for references.
• Be suspicious of vendors who tell you that you will not have to pay your deductible.
• Be leery of a contractor that promises it will handle your claim for you.
David Majors, spokesman for State Farm in Alabama, said people whose homes were damaged by the storms should ask to see proof that a contractor is insured or bonded, and should contact their insurer before allowing a contractor to begin any work they expect to be covered. State Farm, the biggest insurer in Alabama by market share, has seen nearly 12,000 claims related to last week's storms filed so far.
The company also has seen instances of clients allowing large amounts of work to be done without first consulting with the insurer, he said.
"Most contractors are honest and are out there doing good work," Majors said. "But there are opportunists who want to take advantage."
Common frauds that follow storms include unnecessary auto windshield replacement, and outright theft by scammers who pose as contractors and demand payment up-front, insurers said.
"A guy gets a pickup truck and a circular saw, and now he's in the repair business," Colmans said. "The thing to remember is, if you didn't call somebody ... don't deal with people who come knock on your door."
Scams often can be identified by common red flags, Colmans said. If a contractor you did not call comes to your door and offers to waive your insurance deductible, be cautious, he said.
"People need to know who they are dealing with," Colmans said.
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