Avoiding scams after the LA wildfires: What every homeowner needs to know

Natural disasters like wildfires can leave homeowners feeling overwhelmed as they navigate the rebuilding process. Unfortunately, these challenging times often attract individuals and parties looking to take advantage of those in vulnerable situations. When working with public adjusters and general contractors, it’s crucial to remain cautious and informed to avoid scams or unethical practices. To help you protect yourself and your property, we’ve compiled essential tips for working safely and confidently with these professionals.

Public adjusters

Public adjusters are licensed professionals who represent homeowners in insurance claims, typically charging a 5-20% fee of the insurance payout in exchange for negotiating a higher settlement. 

Keep in mind that your insurer will also assign their own adjuster to evaluate your claim—this adjuster works for the insurance company, not you, which is why some homeowners consider hiring a public adjuster.

While public adjusters can be valuable for partial rebuilds or standing homes with smoke damage, they are often less effective for total home losses and could even cost you thousands of dollars. Here’s why:

• Policy Limits: Many homeowners will receive their full policy limit for a total home loss, especially given widespread underinsurance. Public adjusters are unlikely to drive incremental payouts in these cases.
• Personal Property Inventory: Public adjusters can save time by cataloging and assessing damaged personal property. However, in a total home loss, where most items are destroyed, homeowners must often reconstruct inventories from memory, descriptions, and receipts themselves.

If you experienced a total home loss, please be hyper-vigilant of public adjusters. If your home was not a total loss or you’re facing challenges with your claim, a public adjuster might be worth considering. 

Unlicensed, uninsured, and low quality general contractors

After natural disasters, “storm chasers” (contractors who travel to disaster areas to solicit work) often flood the market. These contractors often:

• Lack proper licensing for your state.
• Use substandard materials or rush jobs.
• Disappear before completing work.

Whenever possible, choose a local contractor with an established reputation in your community. Here are tips for how to protect yourself when hiring contractors:

1. Verify Credentials: Only work with licensed, insured contractors. Check licenses and request proof of insurance. If you need assistance, Realm offers access to a network of thoroughly vetted contractors.
2. Get Multiple Quotes: Compare detailed estimates to avoid price gouging on labor and materials.
3. Avoid Large Upfront Payments: Instead, structure your payments around project milestones to ensure work progresses as planned.
4. Check References: Contact past clients and read verified reviews.
5. Sign a Contract: Ensure the scope, timeline, and payment terms are in writing.

Disclaimer:
The information and resource links provided on this website are intended for general informational purposes only and do not constitute legal advice. While efforts have been made to ensure the accuracy of the information, it is not guaranteed to be complete, up-to-date, or applicable to your specific situation. This website is not operated by a licensed attorney, and the information provided should not be relied upon as a substitute for professional legal advice.