Beware of Contractor Fraud After Storms
After recent storms, homeowners are advised to exercise caution when hiring contractors for repairs. The National Insurance Crime Bureau (NICB) reports a 38% increase in contractor fraud from 2023 to 2025, with crimes related to severe weather events such as tornadoes, hurricanes, floods, wildfires, and damaging winds becoming more common.
Homeowners may face additional risks when making hasty repair decisions while dealing with damages like broken roofs, fallen trees, or water infiltration. According to NICB President and CEO David Glawe, victims can become susceptible to manipulation by fraudsters seeking to exploit the situation.
Contractors who appear immediately following a storm might propose services like roof repairs, yard cleanup, water damage mitigation, debris removal, or emergency restoration before an insurance adjuster assesses the damage. This can place homeowners in a position where they might sign documents without thorough review, potentially impacting long-term insurance claims.
The NICB notes that unscrupulous contractors tend to target neighborhoods hit by disasters, often pushing for immediate payment, using substandard materials, or failing to meet building codes. The Federal Trade Commission (FTC) adds that scammers may assert they do not require licensing, offer urgent discounts, or insist on payments through cash, gift cards, wire transfers, payment apps, or cryptocurrency.
Insurance Provider Recommendations
The NICB's primary recommendation is for homeowners to contact their insurance provider first after storm-related damage. Homeowners should be wary of contractors advising policy interpretations, discouraging insurer contact, or urging signing assignments of benefits, which can transfer insurance rights to the contractor.
Additionally, the NICB warns of callers claiming to represent national insurance companies. It advises against sharing personal information unless a claim number is verified. Homeowners are encouraged to obtain multiple estimates, check contractor references, verify active local business licenses, and ensure all job details are documented in a contract that outlines cost, scope, timelines, warranties, payment terms, and other specifics. Avoid signing incomplete contracts or making the final payment prematurely.
The FTC suggests confirming contractor licenses and insurance, comparing estimates, maintaining all financial records, and using payment methods like credit cards or checks over untraceable options. If homeowners suspect contractor fraud, they can report it to the NICB, the FTC, or their state's consumer protection office.