DON'T BREAK THE LAW
"Texas law requires a person insured under a property insurance policy to pay any deductible applicable to a claim made under the policy. It is a violation of Texas law for a seller of goods or services who reasonably expects to be paid wholly or partly from the proceeds of a property insurance claim to knowingly allow the insured person to fail to pay, or assist the insured person’s failure to pay, the applicable insurance deductible."
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DEDUCTIBLE FRAUD IS HURTING TEXAS PROPERTY OWNERS
BREAKING THE LAW HURTS PROPERTY OWNERS
Not only do law-breaking, deductible-waiving contractors cut corners that lead to inferior roofs, but they also often involve consumers in insurance fraud.
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Contractors are committing insurance fraud when they purposefully misrepresent the costs associated with a proposal and/or invoice submitted with an insurance claim. Property owners may be charged with a misdemeanor or felony, depending on the amount of the claim, for unknowingly (or knowingly) participating in the contractor's illegal scheme.
PROPERTY INSURANCE DEDUCTIBLES AND THE LAW
It has long been against the law for Texas property owners to fail to pay the insurance deductible they agreed to pay as part of their selected policy. Like any insurance, the lower the deductible, the higher the premium; the higher the deductible, the lower the premium. Due to a poorly worded statute passed in 1989, back when property insurance deductibles were still low, the law was confusing and not widely enforced.
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As insurance deductibles rose in Texas, some contractors employed "creative" ways to continue to "cover" property owners' deductibles. Unfortunately, this led to some shady practices that often involved cutting corners on a customer's roof (to make up the difference) and caused property owners to unknowingly commit insurance fraud (a misdemeanor to a felony based on whether or not the property owner KNOWINGLY committed deductible fraud).
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A new Texas law took effect on 9/1/19 that requires property owners to pay the full insurance deductible they agreed to pay in their property insurance policy.
The new law also makes it a class B misdemeanor (punishable by a jail sentence of up to 180 days + $2,000 fine) if a contractor pays, waives, absorbs, rebates, credits or otherwise declines to charge or collect a deductible.
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LEARN MORE ABOUT TEXAS LAWS AT:
Texas law requires that contractors must have the following text in their consumer contracts (in a minimum 12 pt font):
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"Texas law requires a person insured under a property insurance policy to pay any deductible applicable to a claim made under the policy. It is a violation of Texas law for a seller of goods or services who reasonably expects to be paid wholly or partly from the proceeds of a property insurance claim to knowingly allow the insured person to fail to pay, or assist the insured person’s failure to pay, the applicable insurance deductible."
BREAKING THE DEDUCTIBLE LAW TYPICALLY
INVOLVES INSURANCE FRAUD
ORGANIZATIONS COMMITTED TO ELIMINATING DEDUCTIBLE FRAUD
