Authorities warn construction firms about their business practices as well as companies and homeowners about getting involved in contractor scams.
There have been several reports within the United States about incidences of misrepresentation where unknown contractors would approach clients as sent by insurance companies. Once hired to work on the property, they are said to overcharge prices and take advantage of advanced payments while applying subpar materials and poor construction techniques. Although this is not a prevalent case, due to the persistence of natural disasters, private citizens and companies are encouraged to be vigilant in investigating the services and general liability contractor insurance of the folks they hire to rebuild their facilities.
One of the foremost recommendations police raised regarding the issue is for consumers to take time to run a thorough background check on the contractors that they come across. It would be best if they refer to local Better Business Bureau, Home Builders Association or insurance claim adjuster listings for any records. And if they have time, expand their search to surrounding states. A legitimate contractor usually is able to provide licenses, operating permits, and general liability contractor insurance policies, as well as a list of previous clients on demand. And they should be able to receive stellar feedbacks from their former customers when approached. It is also important for would-be consumers to coordinate with their insurance agents so that proper estimate can be determined. With this in mind, quotes can be negotiated with your contractor and fraudulent activities can be minimized.
It is important that you pay attention to your contractors insurance as this is one of the tell-tale signs of their sense of professionalism as builders. Mandated as a business requirement in some states, these actually enable them to protect their operations from personal injury, lawsuits and property damages. A building firm that does not have contractors insurance is highly questionable and should be reported to city officials and regulating bodies.
David Johnson, a consultant at Farmer Brown, also encourages construction businesses that have yet to formalize their processes to approach reputable insurance companies, not only to safeguard their interests, but also uphold their reputation and drive in business.
via Contractors Insurance Used As One Of The Basis To Avoid Scam.