Mike Silvers, CPRC, Silvers Systems Inc., and FRSA Director of Technical Services
If you are reading this article, you have probably heard about SB 76, which made some changes to the Florida statutes that regulate property insurance. The law (as of July 1, 2021) was passed with the hope that it will help control rapidly increasing property insurance premiums. It is also intended to attract additional insurers to the Florida market by reducing the cost of claims. One of the major intentions of the legislation is to rein in the skyrocketing cost of roof damage claims. The free roof phenomenon is simply not sustainable. The legislature and the Governor were committed to making this happen. For roofing contractors, the message should be clear: avoid initiating an insurance claim or negotiating claims before a claim has been filed by the insured.
Keep in mind this is an insurance bill not a construction or roofing bill. It is titled “An act relating to insurance.”
This article does not offer legal advice (there are laws against that too), but I am going to attempt to clarify a few possible misconceptions and I will provide some of the actual language in the bill. Please seek legal advice when establishing your company’s specific policies. This article will not examine the changes dealing with attorney’s fees, claim filing requirements or Citizen’s insurance management structure. It will deal with the changes that have the largest direct impact on the roofing industry. Now, let’s look at some of the misinformation in the excerpts from the insurance industry. Below, I have referenced two excerpts from documents that have been circulating recently that attempt to interpret the statute’s new wording. Each excerpt is followed by my clarifications.
New Anti-Soliciting Law for Roofing Contractors: What Does This Mean for You?
In an effort to control roofing scams from occurring throughout Florida, Governor DeSantis recently signed a new law that prohibits roofers from soliciting homeowners. This means that roofing contractors cannot make unsolicited contact with you through any written or electronic means, or in person. Solicitation includes, but is not limited to: door hangers, business cards, magnets, flyers, pamphlets, emails, visits to your home or any other real-time communication.
By law, if you signed a contract with a roofer who illegally solicited your business, you have 10 days to rescind that contract. If a roofer is in violation of this new law, which goes into effect on July 1, 2021, they may be subject to a $10,000 fine and possible criminal penalties.
This new law is one step toward a larger effort to help combat roofing scams and fraudulent claims. Beware of any contractor who solicits your business or tries to convince you that they can get you a brand new roof for free. Fraudulent claims that roofing contractors can profit from are not free: All Floridians pay the price in the way of higher insurance premiums.
First, let’s deal with the incorrect statement found in this excerpt “a new law that prohibits roofers from soliciting homeowners. This means that roofing contractors cannot make unsolicited contact with you through any written or electronic means, or in
person. Solicitation includes, but is not limited to: door hangers, business cards, magnets, flyers, pamphlets, emails, visits to your home or any other real-time communication.”
This is an attempt to interpret SB 76 section (1)(a), which states: “Prohibited advertisement means any written or electronic communication by a contractor that encourages, instructs, or induces a consumer to contact a contractor or public adjuster for the purpose of making an insurance claim for roof damage. The term includes, but is not limited to, door hangers, business cards, magnets, flyers, pamphlets and e-mails.”
It is clear that what is prohibited is soliciting for the “purpose of making an insurance claim.” Advertising and soliciting for roofing services are allowed.
This position is reinforced by (15)(1), which states: “The prohibition against solicitation does not preclude a contractor from suggesting or otherwise recommending to a consumer that the consumer consider contacting his or her insurer to determine if
the proposed repair is covered under the consumer’s insurance policy…”
Soliciting is not prohibited as long as it is done to provide roofing services and not for assisting with an insurance claim. Roofing contractors have a right to advertise, but not to act as insurance adjusters. This also clearly applies to the statement to “Beware of any contractor who solicits your business,” which is a ridiculous statement. Anyone selling anything is soliciting your business.
Newly-Enacted Florida Property Insurance Reform Bill Said to Be Already Working The bill also makes several changes to tackle what insurers claim has been an explosion of roofing claims and litigation, including making it illegal for roofing contractors or any person acting on their behalf to make a “prohibited advertisement,” including an electronic communication, phone call or document that solicits a claim. Offering anything of value for performing a roof inspection, an offer to interpret an insurance policy or file a claim or adjust the claim on the insured’s behalf will also be prohibited. Additionally, contractors are prohibited from providing repairs for an insured without a contract that includes a detailed cost estimate of the labor and materials required to complete the repairs. Violations could result in fines of $10,000.
In this excerpt, I want to focus on the statement: “Additionally, contractors are prohibited from providing repairs for an insured without a contract that includes a detailed cost estimate of the labor and materials required to complete the repairs.”
In the bill, (2)(e) states: “Providing an insured with an agreement authorizing repairs without providing a good faith estimate of the itemized and detailed cost of services and materials for repairs undertaken pursuant to a property insurance claim.”
Doing repairs on a time and material (T&M) or a quoted price basis without an “itemized and detailed cost of services and materials” is perfectly acceptable as long as it isn’t “undertaken pursuant to a property insurance claim.”
Most non-warranty roof repairs are undertaken by the contractor without a fixed price. They may include quoted T&M rates or a “not to exceed” amount but, just like the appliance repairman or other services, it is hard to quote a fixed price until you know what the problem is. If you know in advance that an insurance claim has been or will be filed, then this requirement would apply. and possible criminal penalties.” These are correct but look at the information above and make every effort to not be in violation. The most likely place for a contractor who doesn’t engage in prohibited advertising, assist with a previously unfiled insurance claim, offer something of value to perform a roof inspection or doing any of the other prohibited acts is the section that states:
(5) “A contractor may not execute a contract with a residential property owner to repair or replace a roof without including a notice that the contractor may not engage in the practices set forth in paragraph (2)(b). If the contractor fails to include such notice, the residential property owner may void the contract within 10 days after executing it.”
If contractors avoid the prohibited acts and include a proper notice similar to the one below, then the fines and penalties should not be something they have to deal with. You should consult with your attorney when revising your contracts.
Notice: Florida law prohibits contractors and subcontractors from offering residential property owners a rebate, gift, gift card, cash, coupon, waiver of any insurance deductible, or any other thing of value in exchange for allowing the contractor to conduct an inspection of the residential property owner’s roof or making an insurance claim for damage
to the residential property owner’s roof. See Section 489.147, Florida Statutes.
Hopefully, this information provides some helpful clarifications to the new language in the statute. Your company can establish procedures designed to avoid disciplinary actions or other problems associated with this law.
Mike Silvers, CPRC is owner of Silvers Systems Inc. and is consulting with FRSA as Director of Technical Services. Mike is an FRSA Past President, Life Member and Campanella Award recipient and brings over 40 years of industry knowledge and experience to FRSA’s team.
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