Colorado Roofing Scams - What Are They?
When a severe storm hits in Colorado, whether it's large hail or even an extreme wind event, you can expect roofing company representatives to show up at your door to take a look at your roof. They’ll point out damage that they say is likely to be covered by your insurance, and then pressure you into filing a claim and signing a contract with them for the job. The red flags come when they say they can negotiate a better deal and then offer to handle the rest of the claim from there or when they pressure you to sign a contract on-the-spot without giving you proper time to think it over. Convenient? Not necessarily. Unfortunately, we live in a world where scammers take advantage of these natural disaster events and it falls on you to be cautious and vet these companies that come knocking on your door.
While there are many legitimate roofing businesses, there are many con artists in the roofing industry. Don’t succumb to the pressure tactics of scammers. All reputable roofing companies will give you time to do proper research on them and their competitors. You are able to, and should, get multiple bids for your roofing project and do your research on the roofing companies in your area. Unless you have massive flooding, there is no rush to make an immediate decision.
If you are in an emergency situation, you can rest assured that CRA Members are great resources for you so you don’t have to worry about getting scammed. Colorado Roofing Association contractor members, upon joining the association, fulfill the following eligibility requirements:
- A roofing contractor business license showing that the company has been in operation for a minimum of two years, issued by a Colorado municipality or jurisdiction that requires a test for licensing; or a roofing contractor business license showing that the company has been in business for at least two years issued by two Colorado municipalities that do not require a test for licensing
- Documentation of current Colorado Worker's Compensation Coverage reflecting roofing or sheet metal classifications
- A certificate of insurance showing general liability protection of at least $500,000.00.
- Evidence of passing a nationally recognized examination that addresses roofing work on residential and/or commercial property
- They sign and abide by the CRA Code of Ethics
Click here to search for a CRA contractor member.
Warning Signs of a Roofing Scam
Storm Chasers and Surprise Damage
Some people take advantage of bad weather events by following storms in order to find damaged roofs or homeowners who are afraid but haven't suffered any damage. These people are called storm chasers, and they do this in order to make quick money at the expense of scaring home and business owners. Often their work is of poor quality and done with cheap materials, and they're usually unlicensed and uninsured. They’ll take your money and then get out of town, leaving you the victim of one of the oldest roofing scams in the book.
Storm chasers are usually followed around by people who just “happened to see” damage to your roof as they were driving by. They’ll make vague references to roofing terms and point out damage to your roof that you can’t actually see, and then ask if they can take a closer look.
Once they get a good look, they’ll say there’s “massive damage” and offer to fix it – even if there’s no evidence of any harm! Never let anyone on your roof without seeing first that they are properly insured.
Expressing Urgency and Pushing Fear
High-pressure sales tactics are often the first sign of a roofing scam. Deals that sound too good to be true or situations in which the roofer insists that you have a major problem that urgently needs to be fixed are meant to coerce homeowners into signing legally binding contracts without giving them a chance to do their own research. A legitimate roofing contractor will understand if you want to get a second opinion or take the time to get multiple bids. If your roofing problem is dire, you will be able to tell without the help of a roofer, and it will be obvious to you as a homeowner.
Fixes at Great Discounts
If a roofing contractor offers you discounted materials, waived deductibles, or discounts for signing now, they are likely scamming you and breaking the law. Be careful of initial discounts that sound too good to be true – getting “leftover” materials from a previous job site is not a professional practice.
Do not be fooled by discounts for “signing now”! You will end up paying more in the end. This is because the scammers will increase their fees to make up for the money they lose from waived or reimbursed deductibles and they’ll end up charging your insurance company more for the repairs and pocketing the extra profit for themselves. You could be charged with a misdemeanor criminal offense for insurance fraud* if you fall for this scam!
*If you believe you’ve been approached by an unlicensed contractor or adjuster, or have been encouraged to fabricate an insurance claim, contact your insurance company or the National Insurance Crime Bureau (NICB) immediately at 800-835-6422 or submit a form online at www.nicb.org/reportfraud.
To learn more about how to spot common roofing scams, click the link below.
How to Protect Yourself From Roofing Scams
There are many things consumers can do to protect themselves and their homes or businesses against being the victim of a roofing scam in Colorado:
- Look for well-established, licensed, insured, and bonded roofing professionals with a federal tax identification number and a permanent address.
- Ask for a contractor’s license number and confirm with your city or county building department that the license number was issued by them and is current.
- Check to make sure the contractor is registered to conduct business in Colorado at https://www.sos.state.co.us/biz/BusinessEntityCriteriaExt.do.
- Ask to see the company’s certificates of insurance. Verify with the insurer the certificate is valid, the contractor is endorsed for roofing work, and the contractor’s coverage for liability and workers’ compensation is current.
CONSUMER TIP: Check the number of employees covered by the policy – a low number indicates the contractor will hire temporary help who may or may not have roofing experience.
- Don’t hire a contractor who knocks on your door following a storm. Most legitimate roofing contractors do not conduct business this way.
- Hire a CRA Contract Member to help you with your roof damage. The CRA maintains a current list of licensed, properly insured, professional contractors who have committed to abiding by the CRA Code of Ethics and have passed a nationally recognized exam that addresses roofing work on residential and/or commercial property.
- Contact the Better Business Bureau to check for complaints filed against any company you are considering hiring.
- Be sure to get more than one estimate.
- Require references that specifically include other homes in your area, and check them.
- Make sure you review and understand all documents sent to your insurance carrier.
- Never pay a contractor in full or sign a completion certificate until all the work is completed.
- Don’t be pushed into signing a contract right away. Never sign a contract with blanks or statements like “see insurance estimate, etc.” – fraudulent contractors may enter unacceptable terms later.
- Always ensure that before you sign a contract it includes all the requirements established in Colorado Senate Bill 38.
- Scope of work and materials to be provided.
- Cost for same based on damages known at the time the contract is entered into.
- Approximate dates of service.
- Roofing contractor’s contact information.
- Identification of contractor’s surety and liability coverage insurer and their contact information.
- Contractor’s policy regarding cancellation of contract and refund of any deposit including a rescission clause allowing the property owner to rescind the contract for roofing services and obtain a full refund of any deposit within 72 hours after entering the contract.
- A statement that if the property owner plans to pay for the roofing services through an insurance claim, the contractor cannot pay, waive or rebate the homeowner’s insurance deductible in part or in whole.
- A statement that the contractor shall hold in trust any payment from the property owner until the contractor has delivered roofing materials to the job site or has performed a majority of the roofing work on the property.
- A statement that the property owner may rescind a contract for services, the payment for which will be made from the proceeds of a property insurance claim, within 72 hours after receiving notice from their insurer that the claim is denied in whole or in part.
What to Do if You’ve Been the Victim of a Roofing Scam
Have you been the victim of a Colorado roofing scam or you suspect or have witnessed suspicious activity? You can file a report with the Colorado Attorney General’s office. File a Report Here.
Colorado roofing scams are on the rise. Fraudulent contractors are taking advantage of homeowners by offering shady deals and then either doing horrible work that has to be redone or never completing the work, to begin with. To make sure you don't fall victim to a roofing scam, hire a contractor who is a member of the Colorado Roofing Association. Search our CRA Contractor Member database to find an accredited roofer.