How would you know if there is a financial connection between the property insurance adjuster handling your claim and the roofer you hired to repair the damage? Even if you are a savvy business owner or a conscientious homeowner you really have no way of knowing if you and your property are at the center of a conflict of interest. You may suspect something shady is going on; but you’ll probably never figure it out, unless the adjuster or the roofer decides to tell you.
But they won’t tell you. Unfortunately there have been so many past instances where the insurance adjuster investigating a claim received financial benefits from the roofer contracted to do the repairs, the state passed a law specifically forbidding such arrangements. Texas House Bill 1183 makes it unlawful for an adjuster to handle a claim where he has a financial connection to the roofer, but how could something like this happen in the first place?
It’s usually about the money
When an insured files a claim for damage to his roof, the insurance adjuster is the one who decides what’s covered, how much it should cost, and how much his company will pay for the repairs. Sometimes the adjuster and the roofer can’t come to an agreement, but eventually they work it out. It can be a stressful experience for the property owner who just wants his building returned to normal.
But what if the insurance adjuster only cooperated with the roofer so he’d receive a kickback. What if he was part owner of the roofing business? What if his cooperation made the cost of roofing repairs higher than they should be? What if the adjuster approved and paid for the work even though it was shoddy, incomplete, or not done at all?
When the adjuster and the roofer have a conflict of interests with the owner of the property, they may be more concerned about the dollars to be made than getting the property repairs done right. That’s why the state passed House Bill 1183.
Laws can still be broken
Yes, laws get broken every day. Take speed limits, for instance. Drivers know and understand that speeding is against the law. Authorities even post speed limit signs as a constant reminder. Laws and reminders keep some drivers in line, but they will never stop others from hitting the highway at top speed. The law against roofer/adjuster conflicts probably won’t fare any better.
While insurance adjusters might not always handle claims exactly the way insureds would want them to, only a few behave unethically. It’s the same with roofers. There will always be a few who will do whatever it takes to rake in a few extra bucks. Now that HB 1183 makes it a legal issue and not just an ethical one, a few unscrupulous adjusters and roofers will continue to do what they’ve always done, until someone stops them.
Why should you care about House Bill 1183?
You might not care about laws directed at adjusters and roofers until you have a roof claim or your property insurance company sends you an extra large premium bill. Then you might wonder why.
Insurance companies charge premiums to cover potential risks. If the potential for fraud causes them to predict a rise in the dollars to be paid for future roof claims, or if inflated roof claims have already increased their loss ratios, they’ll pass the costs on to consumers.
What can you do?
There is little for you to do until you have a roof claim and the insurance adjuster contacts you about the damage. Then it will be up to you to pay attention to the details.
Remember that you have the right to choose your own contractor.
If you don’t know a roofer, ask a friend or relative for the name of a someone they trust.
Have your roofer look at the damage, give you a written estimate, and take photos.
Don’t let an adjuster steer you to a specific contractor.
If an adjuster insists on telling you which roofer to use, contact his supervisor.
Never let a roofing contractor repair or have access to your roof without your express permission.
If the insurance adjuster’s actions seem questionable or even shady, contact his supervisor to discuss your concerns.
Consider consulting with an independent adjuster for another opinion.
The idea of fraud can be stressful
It can be difficult for a homeowner or business owner to figure out when an adjuster and roofer are in violation of House Bill 1183. If you do figure it out, it might be difficult to decide what to do next.
As independent claim consultants, we can help you sort through these complicated issues. Contact us for more information.