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How to Avoid Contractor Fraud

posted by TrueNorth Risk Management on Friday, December 17, 2021

In light of the recent unusual severe weather, homeowners are contemplating next steps regarding storm cleanup and home repairs. 

Unfortunately, this makes the impacted regions a target for disreputable contractors who may overcharge or misrepresent the extent of a problem in order to make money off overpriced repairs. It is important to act shrewdly when dealing with certain contractors so homeowners don't end up over-paying for or make unnecessary repairs.


Look out for: 

  • Contractors that contact you looking for work
  • Unsolicited, free home inspections that turn up problems you were previously unaware of or discount rates that are only being offered that day
  • Pushiness on behalf of the contractor that you commit to repairs immediately
  • Request for money in advance for supplies and equipment


One especially dangerous type of contractor fraud involves using a homeowner's insurance to pay for unnecessary repairs. A contractor will begin the process by finding damages and then offer the homeowner a way to get them fixed for little or no cost. The contractor will then cause additional damage before informing the homeowners to file a claim with their insurance carrier. Often, the contractor will assert that the damage was caused by an accidental or weather-related incident.  

Homeowners are often convinced by contractors that this is an acceptable use of their insurance policy, when in fact it is a form of insurance fraud. Insurance companies are on the lookout for such behavior and will prosecute when fraudulent claims are discovered. Unfortunately, the homeowner is often the party that is found responsible, not the contractor who caused the damage. Contractors involved in such scams often deny involvement and divert blame toward the homeowner.  


Be wary of any contractor that shows up at your door out of the blue and claims that your home is damaged, or that they were sent by your insurance company. To ensure the problem they discovered is a legitimate concern, always get a second, third or even fourth opinion before committing to anything.  Don't hesitate to contact TrueNorth prior to beginning work on a repair project if a contractor suggests using your insurance policy as payment. We can review your situation and advise you accordingly. 


To learn more about home insurance, visit As always, TrueNorth is happy to assist you by providing comprehensive insurance and financial solutions for both home and business to help safeguard the things that matter most to you.  

This publication has been prepared by TrueNorth Companies, L.C. and is intended for informational purposes only. Transmission of this publication is not intended to create, and receipt does not constitute, a client relationship with TrueNorth Companies, L.C. This publication does not constitute any type of representation or warranty, and does not constitute, and should not be relied upon as, legal advice. This publication is not a contract and does not amend, modify or change any insurance policy you may have with an insurance carrier. © 2021 TrueNorth Companies, L.C. All rights reserved. 

About Author

In addition to helpful weekly guidance on home and auto, TrueNorth provides a number of insurance options to protect your family from risk. For information on a home or auto quote, visit or call us at (319) 739-1277. We'd like nothing more than to help safeguard the things that matter most to you. 

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