Florida Department of financial services (DFS) charged two men for operating a free roof replacement scheme relating to Hurricane Irma damages.

The arrest of contractors Brian Webb and Brandon Jourdan resulted from investigations by the Bureau of Insurance Fraud. Investigations revealed the two were in a scheme to entice homeowners to claim replacement to their property insurance companies. Homeowners will, in return, get rebates to cover with rebates.

Effect of Insurance Fraud Scheme

According to Florida CFO Jimmy Patronis, free roof fraud "Increases insurance rates increase rates for all Florida families and plague our state." CFO's office said that Services (DFS) investigators found that contractors' employees enticed homeowners to submit insurance claims for on allegation of damage by Hurricane Irma of 2017. Florida laws, in most cases, require insurance companies to pay for full replacements for damage.

The insurance industry had complained about an increase of schemes by contractors claiming wind or hail damage for coverage by insurance payments when the cause was age-relating wear and tear. The increase in claims is driving up the insurance costs and claims.

Several contractors have been charged for similar practices in recent years. A Florida Roofing and Sheet Metal Contractors Association director, Mike Silvers, welcomed regulations enforcement to the widespread problem, including harming businesses that do not peddle questionable insurance claims.

Free offers have become a burning issue to the point of catching the legislature's attention. A few lawmakers showed copies of flyers from companies as evidence that strengthening state law was necessary to curtail the practice and limit losses to the insurance industry.

Laws Prohibiting Enticement

However, some insiders fault state regulators for failing to use existing laws to take action against more rogue companies. Florida Statute 817.234 bars a contractor or a representative from willfully or knowingly paying, issuing a rebate, or waiver of an insurance deductible applicable for repairs payment on insured properties.

Regulators and insurers got more ammunition from provisions in Senate Bill 76 that became law in 2021. The law prohibits contractors from advertising to induce customers to contact a public adjuster or a contractor to make an insurance claim for top damage. An outcome of the current court case might give regulators and insurers more power.

The law also prevents contractors from soliciting or offering rebates, cash, gift cards, waiver, or other valuables to homeowners if they allow inspection or make an insurance claim.

A federal judge has put part of the law on hold in response to a lawsuit by a roofers company claiming it deprives them of a right to free speech. A final decision is pending.

Challenges to Implementing the Law

Stakeholders agree that unrestricted solicitation has become prevalent in Florida, but it is difficult for homeowners to refuse. Mike Silvers, who owns a company, revealed the roofing association received complaints from some consumers who agreed to paid-deductible schemes. Unfortunately, they found leaks due to shoddy work.

Silvers felt that some insurance companies are to blame for the troubles. They began notifying policyholders that they would not insure or renew their policy for homes older than ten years. The plan increased fraud. Silvers wrote in Florida Roofing Magazine that "you are likely to look favorably on the guy offering a 'free roofing' if yours is eight years and you have to replace it when it reaches ten years."