In an effort to educate consumers about contractor fraud schemes that are contributing to increased insurance rates, Florida’s Insurance Consumer Advocate (ICA) Tasha Carter has launched a new educational initiative, Demolish Contractor Fraud: Steps to Avoid Falling Victim.
The new website includes information on how contractor fraud is committed; contractor prohibitions and unlicensed adjusting, as outlined in law; and how consumers are impacted.
“Deliberate deception and intentional acts of fraud are driving up insurance rates and harming consumers. Consumers are essentially paying more for less. The availability and accessibility of adequate insurance coverage is decreasing significantly,” said Carter. “I created Demolish Contractor Fraud to educate consumers on how to spot fraud and protect themselves from falling victim.”
Florida Association of Insurance Agents President and CEO Kyle Ulrich said there has been an increased involvement of contractors, roofers, and water extraction companies in the insurance claims process that is harming Florida’s consumers and leading insurers to cut back insurance coverage and raise rates.
“Many of these contractors often engage in practices that inflate and exaggerate claims while also acting as unlicensed public adjusters,” he said.
The Demolish Contractor Fraud website educates consumers on what contractor solicitation is and how it works. The site includes a “Red Flag” fact sheet on contractor warning signs consumers should watch out for, such as: if contractors demand money upfront; are hesitant to provide proof of insurance; offer payments or gift cards for free inspection; or pressure someone to sign an assignment of benefits or other type of contract in order to perform work.
The launch of the new initiative comes as the Florida insurance industry and stakeholders, including Carter, are urging state lawmakers to enact property insurance reforms to help Florida’s struggling insurance market. According to the ICA, insurance fraud costs more than $40 billion annually, which increases the average family’s insurance premiums between $400 and $700 a year.
“Consumers are being faced with dire circumstances and options centered around homeowners insurance coverage,” said Carter in a recent interview with Insurance Journal, adding she hears daily from policyholders receiving large rate increases or who are unable to find coverage at all as carriers deal with historic losses.
Carter was appointed by CFO Jimmy Patronis as Florida’s Insurance Consumer Advocate in August 2019. The ICA serves the interests of Florida’s insurance consumers by representing the general public before the Department of Financial Services (DFS) and the Office of Insurance Regulation (OIR); examining rate and form filings submitted to OIR; recommending actions to DFS and OIR; and representing the general public on appointed boards and public forums.
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