The 86thTexas Legislature Regular Session came to an end yesterday, May 27, 2019, and with this, two very important bills were passed that will surely affect roofing practices in Texas. These two bills include HB2102 (Prohibition Against Waiving of Deductibles) and HB2103 (Prohibition Against UPPA).
Prohibition Against Waiving of Deductibles
This bill is especially important for the future of the roofing industry in Texas. Steve Badger, a partner at the law firm of Zelle LLP explains the importance of this bill and the affects that it can make in his recent article. Below is an excerpt from his article that explains the significances of the bill:
“The waiving of deductibles has been improper in Texas since 1989. Unfortunately, due to a poorly worded statute, many contractors ignored the prohibition and the waiving of deductibles has become common in Texas. Reputable contractors who refused to break the law could not compete with the “deductible eaters”. Homeowners were lured to sign contracts with shady contractors with promises of “A Free Roof!” And homeowners were duped into committing insurance fraud when they failed to advise the insurance company in submitting a request for replacement cost holdback that the deductible portion of the claim had not been incurred. HB2102 fixes all of these problems by making it crystal clear that deductibles must be paid. Plain and simple. A contractor commits a violation of the new law if it pays, waives, absorbs, rebates, credits, or otherwise declines to charge or collect a deductible. Contracts must also contain a disclosure statement that insurance deductibles must be paid. Finally, an insurance company may request “reasonable proof” that the deductible has been paid before making a replacement cost holdback payment. This important legislation will both protect Texas consumers from illegal fraud schemes and ensure that reputable contractors who collect deductibles are on a level playing field in competing for business.”
Badger’s explains that this is not only to make the competition within the roofing industry fair, but the importance of protecting homeowners from the possibility of getting in legal trouble due to the misinformation that is fed to them by fraudulent contractors. If you would like to read the bill for yourself, it is available here.
Prohibition Against UPPA
This bill also is important to ensure that ethical practices are used not only in the roofing industry, but in all industries that public adjusting is associated with. Steve Badger once again explains the significance of this bill, as he states
“Section 4102.163 of the Texas Insurance Code enacted in 2013 prohibited the unauthorized practice of public adjusting by “roofing contractors”. Since that time, we have seen the UPPA problem spread to other types of contractors as well, particularly in water damage claims and with some so-called “general contractors”. HB2103 simply deletes the word “roofing” from the existing statute to broaden the scope of the UPPA prohibition to all contractors. Also, new language is added to the statute clarifying that a contractor cannot use an assignment of benefits or power of attorney form to avoid this prohibition. This will ensure that Texas never experiences the assignment of benefits crisis that Florida has been dealing with for many years (until passing new legislation this month).”
To read the bill in its entirety, click here.
We would like to thank RCAT (Roofing Contractors of Texas), NTRCA (North Texas Roofing Contractors Association, and TAPIA (Texas Association of Public Insurance Adjusters) for their work to get these bills passed and to improve our industry. These groups are effecting change and leading by example. We encourage all homeowners to continue to uphold their standards and to choose reputable contractors within the roofing industry and all other construction industries. Participating in ethical practices betters all those involved and results in high quality professionals and work.
If you have any questions contact us at firstname.lastname@example.org or leave a comment below!