Contractor wants to take most of insurance money to replace roof
Contractor agreed to replace my roof if insurance would pay for damages. He came to my door offering his service. To my surprise the insurance company agreed to pay $21,000 for damages. Our contractor quoted us $20,000. Average prices in our area to replace a roof is $11,000 for the size house we have. I'd like to repair other things around the house with the difference. But the contractor made us feel guilty that he worked hard to get us a $1000 in cash. Contractor says his quote is non negotiable and won't budge on price.
My question is am I missing something? Should I pay the contractor all the insurance money? Why is there a big gap between average roof replacement costs and insurance award?
Quote from @Terry Hollinsworth:
Quote from @Ronaldo Marion:
Quote from @Terry Hollinsworth:
Quote from @Ronaldo Marion:
Likely scenerio: The roofer solicited home owner stating he could get the property owner a "free roof" by negotiating with the insurance company then waiving the deductible (illegal). Roofing contractor then proceeds to inflate his estimate working hard to extract as much as possible from the insurance carrier. Roofer finally get the insurance co to issue payment and now property owner has been paid out but realizes he can get the actual work done for much less than the check in hand. Now property owner wants go with another cheaper roofer or patch the roof and get something else fixed or just pocket the money. Basically double crossing the roofer than worked hard and got the claim approved in the first place. But little does the homeowner know he signed a AOB (assignment of benefits) that is more than likely iron-clad and essentially forces the homeowner to use the original contractor to perform the work. If homeowner doesnt use the original contractor he's likely going to end up with a lien on the property.
ok, I got other bids on my roof. They're significantly lower than original roofer. Almost 9K lower for same work. I understand taking profit but c'mon thats just crazy. I'd go with original roofer if he came down on price just a couple of thousand dollars. But, he's not budging .
Your dilemma is that the $21,000 insurance co check with your name on it actually belongs to the original roofer. You see you signed over your benefits (the $21,000) check when you signed the AOB so if you do anything other than hand that check over to that roofer and have your roof fixed you're actually in breach of contract.
You only really have 2 options:
1. Tell insurance company price is inflated and the roofer is a scammer, they will cancel the claim and allow the roof replacement to be repriced. This doesn't really help you. You'll likely end up with A LOT more eyes on your claim. This will likely end up with a poor outcome for you.
2. If you have another roofer that will do the job for $11,000 and you are confident that the quote is firm. Then you effectively have $9000 (the difference between the two quotes) to bargain with. You might offer the original roofer $4000-5000 to cancel the AOB and walk away. Knowing how profitable roofing is I doubt he would walk for less than $5000. Note: THIS IS ILLEGAL. I AM NOT ADVISING YOU TO TAKE THIS COURSE OF ACTION.You keep saying AOB? What is that? Where can I find more info on it? It dosen't say AOB on form I signed.
I think it was implied early in this thread that you had signed a AOB. If you signed only a contract, you may or may not be able to cancel based on the details of that agreement. The legal strength of the roofing contract could range from simply being able to cancel in writing and walk away (weak) to being an AOB equivalent (very strong). You will need to review the fine print to find out exactly how strong the contract is that you signed.
Quote from @Matthew Paul:
Quote from @Terry Hollinsworth:
Quote from @Kim Meredith Hampton:
Quote from @John Underwood. sounds like she already signed the agreement??Yes I signed the agreement. However my wife didn't. Both of our names are on the deed and on the insurance check. Can we get out of this contract if my wife didn't sign?
No , you would be sole responsible for payment . The contractors price couldnt be that much higher , insurance companies know the local rates . You also signed a legal binding contract . Odds are that if you cancel and have someone else do the work , you may still have to pay the first contractor . If you go to court you need a lawyer so does the contractor . This will cost you money , legit contractors have almost iron clad contracts . Can you afford to take a loss?
Matthew, (and others) it really DOES depend on the state... Ex: here in TX, IF no work has been done yet, 90-95% of the judges here would say that it is not binding or can't be enforced. But yes, it really depends on how it is worded. And, up to them (judge) to determine... is filing a claim for the Client considered starting the work!? lol Tomatoe - Tomato :D
William (and others) Per your reply in the one post about the ongoing Roofing situation they have:
Most roofing co's have Salesmen that, need to make money! lol (we don't have Salesmen at all) So they door knock in planned out neighborhoods (mostly residential, sometimes even commercial areas). They convince the Client allow them to get on the roof to see if there is any damage... and wow, of course they find enough damage that should warrant an insurance claim! hahaha (even when most times there are NO marks at all from hail and no wind damage (the only reasons ins co's pay to replace a roof, not longevity)). So then the Salesmen or Co usually runs with that, getting the ins info from the Client, making the claim, getting (or Trying to get it) approved, then ... saying to the Client, "ok! We made the claim, they approved it and said it would run $20K. They are paying $15K and your part is $5K, let's get this going so when should we start!?" (sigh, it happens all the time)
CORRECT! For small items, like a few shingles or a single leak (commercial roofs), just get it fixed. No sense in trying to make an insurance claim for that. Unless you are TRYING to get the whole roof approved for replacement. :P
As discussed in several other forums or Discussions, the ins co's ARE being more critical now regarding roofs/roofs age. The common theme now is when a roof gets to be 15yrs old, then they are saying mostly: We will still cover the property, but not the roof! 2)We will not cover the property at all because the roof is older than 15yrs old. In both cases, it's getting ridiculous.. the Ins Co's wanted us (the roofing industry) to come up with better and longer lasting materials, so we did! (Class 4/hail resistant shingles and such) But now... WHAT!?!? lol Oh, State Farm is one that is NOT cancelling policies for older roofs. But, they are a different story by themselves. :P
I hope this info helps. Send a message to me directly with questions or look us up online! :D
Quote from @Ronaldo Marion:
Quote from @Terry Hollinsworth:
Quote from @Ronaldo Marion:
Likely scenerio: The roofer solicited home owner stating he could get the property owner a "free roof" by negotiating with the insurance company then waiving the deductible (illegal). Roofing contractor then proceeds to inflate his estimate working hard to extract as much as possible from the insurance carrier. Roofer finally get the insurance co to issue payment and now property owner has been paid out but realizes he can get the actual work done for much less than the check in hand. Now property owner wants go with another cheaper roofer or patch the roof and get something else fixed or just pocket the money. Basically double crossing the roofer than worked hard and got the claim approved in the first place. But little does the homeowner know he signed a AOB (assignment of benefits) that is more than likely iron-clad and essentially forces the homeowner to use the original contractor to perform the work. If homeowner doesnt use the original contractor he's likely going to end up with a lien on the property.
ok, I got other bids on my roof. They're significantly lower than original roofer. Almost 9K lower for same work. I understand taking profit but c'mon thats just crazy. I'd go with original roofer if he came down on price just a couple of thousand dollars. But, he's not budging .
Your dilemma is that the $21,000 insurance co check with your name on it actually belongs to the original roofer. You see you signed over your benefits (the $21,000) check when you signed the AOB so if you do anything other than hand that check over to that roofer and have your roof fixed you're actually in breach of contract.
You only really have 2 options:
1. Tell insurance company price is inflated and the roofer is a scammer, they will cancel the claim and allow the roof replacement to be repriced. This doesn't really help you. You'll likely end up with A LOT more eyes on your claim. This will likely end up with a poor outcome for you.
2. If you have another roofer that will do the job for $11,000 and you are confident that the quote is firm. Then you effectively have $9000 (the difference between the two quotes) to bargain with. You might offer the original roofer $4000-5000 to cancel the AOB and walk away. Knowing how profitable roofing is I doubt he would walk for less than $5000. Note: THIS IS ILLEGAL. I AM NOT ADVISING YOU TO TAKE THIS COURSE OF ACTION.
Roofing is THAT profitable !?!? LMAO ... Geeezzzz, if I/we were scamming everyone and/or perhaps working for yourself maybe? If that's the case, and you pay that well... call us!!! :D
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#3 All Forums Contributor
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Assignment Of Benefits. You agreed to pay the original roofer from the Insurance Claim settlement....
If you already signed this with him (by signing his contract) then you are legally stuck IMHO....
ok, the roofer agreed to accept 10% ($1,100) of the roof costs. The insurance covered other things around the house but the roof coverage was 11,000. Roofer tried every trick in the book to intimidate me for more money and to finish the roof as planned. in the end he took the $1,100 as the contract i signed said I'll compensate him 10% to cancel the contract.
Quote from @Victor S.:
read the contract and see what it says about non-performance from your end. the insurance co wrote a detailed quote that shows how much they think everything will end up. it's not like they just pulled that 21k out of their behinds.
i'm glad you followed my advice from july...