N.C. Commissioner Warns of Scams in Wake of Isabel

October 8, 2003

North Carolina Insurance Commissioner Jim Long warned residents of a possible scam involving repair service companies offering to settle insurance claims after Hurricane Isabel.

Accusations have reportedly started trickling in that unscrupulous repair people are advising homeowners to make repairs now and worry about insurance claims later. In some cases, these repair people have allegedly required customers to commit to a payment of as much as 25 percent of the costs before receiving an estimate from the insurance company.

The Department of Insurance strongly advises residents against signing contracts before reaching an agreement with their insurance companies. Businesses offering to help settle claims must be registered with the Department – otherwise they are operating illegally.

“It has come to our attention that residents with damage to their homes may be getting bad advice from repair people just out to make a quick buck,” said Long. “Many homeowners are anxious to fix their homes and get their lives back to normal, but don’t act without taking the proper steps to ensure that your insurance company will pay your claim – or you may be stuck with the bill.”

In 2002, a DOI investigation into fraudulent practices by a repair service resulted in active jail time for two individuals prosecuted by the Office of the United States Attorney. An official investigation into current allegations is pending.

Residents are encouraged to make temporary repairs that are necessary to prevent further damage to their homes, and photographs of the original damage should be taken before any repairs are attempted.

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