MISTAKE #4: Using A Roofer Who Offers To Pay Your Deductible
It sure sounds good when a roofing contractor tells you that he will take care of paying your deductible, right? I mean, that could save a homeowner hundreds, or even thousands of dollars! But did you know that this is illegal in Colorado? On June 6, 2012, Colorado’s governor signed into law SB-38 which states that no roofing contractor may pay, waive, or rebate all or part of a homeowner’s deductible or even offer to do so. In fact, every roofing contractor is required to have a statement on his roofing contract saying that he will not pay, waive, or rebate a deductible.
Why Is This Illegal?
On the surface, that’s a valid question. Doesn’t a business owner have the right to cut into his own profit if that’s how he wants to run his business? The problem is that an insurance policy is actually a contract that the homeowner has with his insurance company, and in many cases the policy states that the deductible is the homeowner’s responsibility to pay. Therefore, if the roofer is paying the deductible, the owner and the roofer are, in effect, colluding to commit insurance fraud. If the roofer is not going to collect the deductible from the homeowner, then he is invoicing the insurance company for more than he will be collecting from the insured. For example, if the deductible is $1000 and the insurance claim is $10,000, then the roofer has to tell the insurance company that he’s charging $10,000 when he’s actually only charging the homeowner $9000. If the insurance company knew that the roofer is only charging $9000, they would send the homeowner only $8000.
What Should You Do?
I know that this can all be confusing and that many roofers have several “creative” ways around this law so that the homeowner ends up with a “free” roof. However, the best thing you can do if a roofer offers to pay your deductible is to find an honest roofer – one who will obey the law and not cut corners on the quality of your roof in order to make up for the lost profit he incurs by paying your deductible.