Risk Management Tip

Prevent home repair insurance claim fraud

Home repair fraudsters will often claim to have been sent by your insurance company to inspect your roof or to check for sinkhole damage or some other structural issue, according to the National Insurance Crime Bureau. They might even promise that the work they do will be covered by your home insurance policy. Unfortunately, some fraudsters intentionally keep homeowners in the dark about the nature, cost and status of their claim. Worse, when these contractors present an inflated claim to an insurance company, you could be sued or face a lien on your property.

Home repair fraud most commonly victimizes senior citizens, first-time homebuyers, women and those who aren’t native English speakers, according to the National Center for the Prevention of Home Improvement Fraud. Homeowners in areas that have just been hit by natural disasters also are popular targets for home repair fraudsters. Such targets are especially vulnerable because they’re feeling stressed, they lack knowledge about repairs or they simply aren’t aware of repair fraud.

Before beginning any home repair project, obtain at least two bids in writing, the Federal Trade Commission (FTC) recommends. The FTC also suggests the following guidelines when dealing with contractors:

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