Avoiding Contractor Scams

Written by LakevilleInsurance on . Posted in Uncategorized

Every year, many homes and commercial buildings are damaged by severe storms. Property owners become the victims of unlicensed, uninsured, and inexperienced contractors as well as outright scammers who come to prey on uninformed people.

Poor-quality contractors and scammers can cause permanent damage, devalue your property, steal your money, and put you at personal, legal, and financial riskā€”not to mention all the headaches! Many scams begin with a knock at your door or an unsolicited call on the phone from someone who claims to be a contractor.

Unfortunately, many scam companies imitate legitimate contractors, so protect yourself by checking your contractor out before agreeing to an inspection. Make sure any contractor you work with is properly licensed, insured, and provides three local references.

Scam Warning Signs

The following list represents the most common indicators that the person or company you are speaking with might be running a scam:

  • Not properly licensed
  • No insurance or under-insured
  • No local office (beware of P.O. boxes and hotel addresses)
  • Won’t provide local references
  • Demands up-front cash or deposit
  • Shows up on convicted criminals and/or sex offenders list

Out-of-State Contractors

If you decide to hire a contractor that is based out of state, make sure they have a local office or reciprocal relationship with a local contractor who will perform warranty repairs if your contractor should leave the state. It is important to remember your workmanship warranty is worthless if your out-of-state contractor leaves the state and does not have a local representative to honor the warranty.

Storm Chaser Scam Warning Signs

Storm chasers are like ambulance chasers. They flock to areas of the country that have been recently hit by damaging storms and attempt to scam people that are in need of serious help. Watch for the following warning signs that might indicate someone is trying to scam you:

  • A temporary office or P.O. box
  • Out-of-state phone numbers
  • Out-of-state license plates
  • Staying in a hotel or motel
  • No local references
  • Unfamiliarity with your area

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