Don’t fall for Post-Disaster Scams
Natural disasters cost Americans billions of dollars a year. The National Oceanic and Atmospheric Administration reports the U.S. has sustained 400 climate disasters since 1980 where overall costs topped $1 billion. The total cost of these events exceeds $2.7 trillion.
Sadly, the survivors of these disasters are often victimized a second time by dishonest contractors who take advantage of their desire to quickly recover and rebuild. The National Insurance Crime Bureau estimates as much as 10% of the $93 billion in catastrophe losses in 2023 were subject to fraud. That’s $9.3 billion.
Many victims are unfamiliar with how to file an insurance claim or what government programs are available to them. Unscrupulous operators can step into the void and bilk them out of thousands of dollars.
Who can you trust?
If you’ve been the victim of a disaster, understand there are legitimate sources of relief to help you recover. But who can you trust when scammers abound? According to the Federal Communications Commission (FCC), scammers use phone, text, mail, email and even door-knocking to target residents of affected areas after a disaster.
The FCC says government assistance agencies don’t call or text to ask for financial account information. And there’s no fee to apply for or get assistance from the Federal Emergency Management Agency (FEMA). The FCC says federal disaster relief agents are required to carry oicial identification and show it to you upon request. They can’t ask for or accept money.
The FCC recommends contacting your insurance agent directly after a disaster. If you experience flood damage and have flood insurance through the National Flood Insurance Program, call 800-638-6620 to file your claim.
Beware of scammers posing as insurance reps
Scammers also may claim they’ve partnered with your insurance company. Don’t give them your policy information or share any personal information. You can see if a contractor is licensed by checking your state’s licensing boards. A good source is the National Association of State Contractors Licensing Agencies’ online database.
Adjusters International, which represents public insurance adjusters, recommends thoroughly researching a contractor’s credentials before hiring them. Steer away from those who say they have the authority to adjust a claim or request all their payment upfront.
FEMA suggests:
Using local contractors if possible
Getting an estimate in writing from several contractors
Making sure the contract spells out the details of the job, the types of materials to be used, when the work will be completed and the payment schedule
It’s also a good idea to ask for a copy of the contractor’s liability insurance certificate. Finally, the Federal Trade Commission says to watch out for these telltale signs of a scam:
The contractor tells you to sign over your insurance check, or insists on being paid by cash, cryptocurrency, wire transfer or gift card.
Sources you can rely on
If you’ve suffered property damage from a major storm or disaster, here are some sources you can trust:
For insurance claims, contact your local agent and notify your insurance company according to the procedures specified in your policy.
Recovering from a disaster is difficult, enough without the added worry of being scammed or cheated. Take steps to protect yourself so you can rebuild with confidence and peace of mind.
This content is for informational purposes only and not for the purpose of providing professional, financial, medical or legal advice. You should contact your licensed professional to obtain advice with respect to any particular issue or problem.
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