Due to frequent hail storms and a lack of oversight, Texas homeowners have to contend with an abundance of fraudulent roofers. A new law is set to close a loophole that has plagued unsuspecting homeowners for years, but now the time has come to decide whether or not this law is an overdue correction or just a retread? In this brief article, we will discuss the passing of the Payment of Insurance Deductible bill and what it means for roofers in The Lone Star State. Consult with a roofing attorney in Texas for questions regarding the laws of your state.
The scam would go like this: roofers would promise free roof repair or replacement to homeowners and inform them that their deductibles will be covered. As a result, homeowners would fail to pay their insurance deductibles and end up accidentally committing insurance fraud. This scam is harmful to not only homeowners, but also honest roofers that can’t compete with their offers of free roof repair. While the above practice has been illegal for decades in Texas, the previous law was too vague to have any teeth.
Payment of Insurance Deductible
The Payment of Insurance Deductible bill, H.B. 2102, states: “It is a violation of Texas law for a person or business paid wholly or partly from proceeds of a property insurance claim to knowingly allow the policyholder to fail to pay, or assist the policyholder’s failure to pay, the applicable deductible.”
Essentially, roofers can now be effectively prosecuted for waiving deductibles. A roofer caught waiving deductibles can be charged with a Class B misdemeanor, sentenced to jail for 180 days, and fined up to $2,000. Homeowners will now have to pay more out of pocket for roof work, but they will no longer be penalized for being duped by fraudulent roofers.
Consult an Attorney
This bill is clearly not a retread of what came before and effectively defines and prohibits the illegal practice of waiving deductibles. Even though a previous bill that would have created a registry of legitimate roofers failed to pass, Texas is making strides to rid itself of fraudulent roofers. If you were under the assumption that waiving deductibles is permissible in the State of Texas, it is imperative that you speak with a legal professional. Partner with a roofing lawyer in Texas to ensure that your roofing business complies with all current and future state laws.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.