Here’s a major way the Texas roofing industry is about to change.
A new state law designed to protect hailstorm victims from scamming roofers means more out-of-pocket roofing costs for many homeowners.
If Gov. Greg Abbott signs a bill on his desk, after a vicious hail storm you’ll soon need to expect to pay $1,000, $2,000 or more (depending on your deductible) for a new roof. A roofer could not pick up the charge.
The new law seeks to end the mentality in the unregulated Texas roofing industry that can best be summed up this way: You scratch my back, I’ll scratch yours.
The bill requires a homeowner to pay an insurance deductible in full, as already required by law. Sounds obvious enough. In fact, this is the third time The Watchdog knows of that state law being rewritten to require deductibles payment. This ignored provision became state law 30 years ago. That’s proof right there that few pay attention to the existing law.
Here’s the street version: A hailstorm hits your neighborhood. Roofer trolls parade up and down your block with promises of fast service. And, “Hey, I’ll pick up your deductible.”
It’s usually a winning argument. Harry Homeowner doesn’t know that kind of talk and follow-up is against existing law. Poor Harry. He currently could be prosecuted for insurance fraud. Not that this happens.
The back-scratching roofing company can usually offer a lower price than a more honest competing company that is trying to follow the law.
How is the potential law different from the existing law that few follow? Proof of deductibles payment in the form of a canceled check, money order, credit card statement would be required as part of any insurance claim.
This required announcement would start accompanying all homeowner claims letters: “Texas law requires a person insured under a property insurance policy to pay any deductible applicable to a claim under the policy.”
What this means is the roof job you got where the $2,000 deductible was “forgiven” and buried in other ways in the roofer’s paperwork would now be required as payment. Out-of-pocket. With proof that you did it.
This doesn’t put extra money in the insurance company’s pocket. Insurance companies always find a way to carve out their deductible from a claim payment. It’s just a matter of who, in the end, secretly pays it. And how.
What’s the benefit to consumers? Not as much as I’d hoped.
For one thing, insurance fraud is fraud, even if nobody is prosecuted. But if approved by the governor, the new law — House Bill 2102 by Rep. Giovanni Capriglione, R-Southlake — removes existing penalties for any homeowner who evades the law.
Another benefit for consumers: Knowing that deductibles must be paid and then hearing a sales pitch from a roofing company that offers to bypass the law is a red flag. What other corners do they cut?
This doesn’t sound like much of a consumer victory, does it? Homeowners lose some of their right to negotiate pricing with roofers.
Abbott could veto the bill and say it essentially already exists in state law, which is true.
My problem is that this was only a small piece of a much larger roofing industry reform campaign. A companion bill one number away — HB 2101 — would have created a required registry for “re-roofers” where they’d have been required to pay $250 to register and provide their name, address and phone number to the state.
That’s not much. No required classes. No license. No tests. Just a roofer’s name on a public list, a computer database that consumers could check to find real roofers.
This waiving of the deductible law, the back-scratcher bill, was paired with the registry bill. Together, they were designed to bring order to a rough industry where victims sometimes pay pretend roofers who then flee. Homeowners lose their money.
But that registry bill went down as hard and fast as any bill I’ve ever seen in a state Legislature. I’ve spent the week reviewing tapes of the debates and votes and interviewing the players involved in that debacle.
In my next Watchdog report, I’ll take you behind the scenes of that catastrophe. Why did tea party loyalists line up with liberal Democrats to kill the bill and do nothing to bring order to the Wild West that is Texas roofing?