With passage of the new law in Colorado, is it illegal to offer a free upgrade from thirty year shingles to impact resistant shingles?
State/Country relating to question: Colorado
Read the law online and Colorado Roofing Association's general interpretation. Don't want to end up in trouble, but would like to help potential customers.
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Still have no guidance. We cannot offer to pay an insured's deductible, in whole or part, but often offer incentives to do business with us, including upgrades in roofing felt, solar roof vents, ice and water shield, or even to an impact resistant shingle. Can we continue this, or could this be considered as offering rebates toward a deductible?
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Fran referred this to me for review and answer as I have much experience in the construction industry. I have reviewed the colorado law you are referring to where it prohibits a roofer or other contractor from manipulating the contract to pay the owner's deductible that the owner would otherwise pay. The problematic language in the statute that you need to worry about when offering these upgrades is that not only are you forbidden from paying the deductible, but you are forbidden from giving anything of value that will assist the owner with paying the insurance deductible (because the insurance company can then claim that the full cost of the repair is being passed onto them). This law is going to take years to get appropriate interpretations through the courts and I do not even think you are going to get a local CO lawyer to tell you to go ahead and continue to offer these upgrades and "it is okay". My suggestion is that if you continue to offer such incentives then you and your company must be able to show on paper that the cost of the repairs and your upgrades do not somehow negate the need for the homeowner to pay the deductible on their insurance claim. You may want to speak with a local CO lawyer on the best way the lawyer believes is to document the offering of such incentives so that the incentives cannot be viewed as paying the owner for the deductible. I wish I could tell you to go ahead and do as you have always done -- but because this law is so NEW (June 2012), there is going to be a lot of angst and interpretation as the kinks are worked out of the actual application of the law and everyone gets used to it.
Please let me know if you have any further questions -- if not canyou please press the THIRD, FOURTH or FIFTH smile or star below so that I will be paid for my time. I am paid nothing unless you press the 3rd face or star OR the 4th face or star OR the 5th face or star below. This is not a hobby for me -- it is how I earn a living so I appreciate it when my customers press thecorrect button below so I will be paid for my time. THANK YOU !!
Thanks for your response. This is indeed the point of the law with which we are struggling. My prices are virtually never above the prices offered by insurance companies, and these incentives are usually less than any deductible, but the inclusion of 'partial' suggests to me that anything other than 'full price' may be subject to the penalties of the law. With my real estate agent's customers we can negotiate price or offer incentives to win a contract, but apparently that right is abridged by this law with insurance customers. Thanks for your help, and any other insights you might have.
I honestly think that if you can document each transaction to show that you did not offer anything additional that would lower the price (showing that the price would have been the same whether you offered the upgrade or not) then you may be able to come within the parameters of the law and not get in trouble. But you must understand my predicament because I do not want to tell you to go ahead and do it and then you get in trouble with it -- this is really not the forum to get a rock solid opinion like that. I honestly think you will have a hard time getting any local CO attorneys to get involved with this just yet also -- at least until things develop a bit further.
If you have not done so already, can you please press the THIRD, FOURTH or FIFTH smile or star below so that I will be paid for my time. I am paid nothing unless you press the 3rd face or star OR the 4th face or star OR the 5th face or star below (I did take the time to research the issue for you and contemplate a valid response under the new CO law !)
I am considering changing my pricing, regardless of customer or circumstance, to reflect the same price for the thirty year shingles as the impact resistant shingles, and a homeowner option to choose a solar powered roof vent in place of three other passive vents, as my standard practice. I do think I will pursue this question locally. I am guessing I should contact someone in contract law, specifically in the construction field? Thanks!
Yes you should so you do not run afoul of the law before it even gets off the ground -- and knowing how fierce the competition can be I would not be surprised if your competition would be the ones to turn you in just to start trouble. At least if you pass what you want to do by a local attorney if the insurance industry claims you are violating the law you can say that you made a good faith attempt at legal interpretation. t
14 years experience corps, LLC's and partnerships; preparation, negotiation of complex contracts and business agreements
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