Most public adjusters and contractors are honest and competent. They’ll do their best to make you a satisfied customer. But you should know the warning signs of a fraud, how to prevent it, and how to report it.
A disaster can lure dishonest building contractors and public insurance adjusters. They’ll try to exploit the confusion and emergency conditions and swindle you and your insurance company.
Contractors: Remember when working with or hiring contractors
Get several bids. Obtain two or three written repair bids, if possible. The bids should include all costs, a description of the work to be done, the schedule for completing the work, and all guarantees.
- Don't accept a bid just because it's the lowest. If it’s too good to be true, it could be fraudulent
Use established contractors. Be careful if the contractor arrives in an unmarked vehicle or seeks your repair work by going door-to-door. These contractors may be unlicensed, untrained, or dishonest, trying to make a quick dollar at your expense.
- Often they'll use low-grade material.
- Their work may be shoddy and even dangerous.
- They may disappear with your money after finishing only part of the job, or not doing any work.
Confirm that the contractor is properly registered to do business in Connecticut. Connecticut law requires anyone who is in the business of home construction, alterations, remodeling, or repair to register as a Home Improvement Contractor with the State of Connecticut Department of Consumer Protection. You should always confirm that you are working with a licensed contractor, which you can do by visiting www.elicense.ct.gov
In addition, ask for references from the contractor and check them out before allowing any work to be done.
Get a signed contract. Under Connecticut law a contractor should provide you with a written contract. Make sure it is signed, and never sign a contract with blanks.
Never pay in advance. Don't pay a contractor in full before work begins or before it's finished. The contractor could disappear with your money, leaving your repair job unfinished. A percentage of the total repairs in the form of a down payment is not unusual, but be careful. Pay only what's spelled out in your signed contract.
Never pay in cash, wire transfer, or any other untraceable form of payment. Pay only with check or credit card if possible so that payment can be cancelled, if necessary.
Public Insurance Adjusters: Doing business with public insurance adjusters
Insurance companies employ their own adjusters or retain independent adjusters who are trained to evaluate your property damage and help walk you through the claims process free of charge. Company and independent adjusters represent the insurance company’s interest in the settlement of claims. In Connecticut you can also hire public insurance adjusters to help you file claims and negotiate your insurance payment. Public insurance adjusters represent the claimant and charge a fee for their service.
Most public insurance adjusters are honest and competent, but some might not be, especially if they’re not licensed. They could take advantage of disaster victims by:
- Charging you a large upfront fee and then disappearing without handling your claim.
- Referring your repair to a dishonest contractor for a kickback, and you may receive poor repairs in return.
- File false and inflated claims against your policy. Sometimes they'll also try to convince you to join the scheme.
- Use their position of trust to access your Social Security number and other personal data for scams involving identity theft.
Licenses: All insurance adjusters must be licensed in Connecticut. Make sure any public insurance adjuster you’re considering or allowing on your property is properly licensed in the state. To verify the license status of a public or company adjuster, please visit Verify License. During disasters emergency adjuster licenses are issued to adjusters representing insurance companies so please check both the link above and the emergency adjuster list for company adjusters. If you suspect an adjuster is operating without a license, please report such activity to the Connecticut Insurance Division by filling out a complaint form online.
Adjuster Conduct and Fees: Make sure you know the public adjuster’s fee. Public adjusters must disclose all fees. Connecticut Gen. Stat. 38a 723-726 and Connecticut Regulation 38a 788-1-10 provide specific requirement s for all public adjusters.
No public adjuster shall charge, agree to, or accept as compensation or reimbursement any payment, commission, fee, or other thing of value equal to more than ten percent (10%) of any insurance settlement or proceeds. No public adjuster shall require, demand or accept any fee, retainer, compensation, deposit, or other thing of value, prior to settlement of a claim.
Limitations of Public Adjusters under regulation Sec. 38a-788-6
Public Adjusters are not allowed:
—to solicit your employment between 8:00 p.m. and 8:00 a.m.
—to solicit your employment if you have already hired or contracted with another public adjuster.
—to have any interest whatsoever in any construction, salvage, or appraisal business.
—to represent both an insurer and an insured at the same time.
—to pay anything of value to any person as an inducement to refer business to them.
—to share their fee, except with another licensed Public Adjuster.
—to advise you on any question of law.
—to advance any monies to you before settlement of the loss, where such amount would be included in the final settlement.
—to make false statements about an insurance company or its representatives.
If you suspect that a public insurance adjuster or your company’s adjuster is being dishonest or acting in violation of Connecticut requirements, you may file a complaint online with the Connecticut Insurance Department.
Additional Resources: Assistance with Disaster Claims
For questions on obtaining flood insurance, what to do before, during or after a flood, and/or to report flood related claims, please contact the NFIP (National Flood Insurance Program) at 800-638-6620 or www.floodsmart.gov
For general information/assistance on Connecticut disasters please visit the Department of Emergency Management website
For Disaster or Emergency Service Information please contact United Way 2-1-1.