Roofing Regulation Causes Last Minute Controversy

A bill designed to protect homeowners when hiring a roofing company is on its way to Governor Hickenlooper’s office, but critics are spearheading an effort to get the measure vetoed. Their concern with the bill is the way it could be interpreted.
Colorado’s historic hail season makes the state ripe for roofing rip-offs. Colorado lawmakers have tried in the past to pass legislation that would protect consumers from fly-by-night operations that move through the state after a big storm.
“We needed to do some Consumer Protection around this,” said Sen. Lois Tochtrop, a Democrat from District 24.
Tochtrop sponsored Senate Bill 12-038, it passed through the House and Senate, getting support from both political parties. The bill requires a written contract between roofing companies and consumers. The contract is required to include the scope of work to be done, dates for the work and cost of the work. It also includes a rescission clause that allows consumers to cancel the contract with 72 hours and get a full refund of any money that has been paid. The bill also prohibits a contractor from paying, waiving, or rebating the consumer’s insurance deductible.
“It’s going to be a huge detriment to consumers,” said Derek O’Driscoll, a licensed public adjuster and a roofing contractor.
O’Driscoll is among a growing number of people and groups opposing the legislation. Public adjusters, the Merlin Law Group, which is a Florida law firm specializing disputes between homeowners and insurance companies, and United Policyholders, which is a non-profit consumer advocacy group out of California, have all come out against Senate Bill 12-038. Their biggest concern is the way the bill is worded.
“Some of the terminology, language and lack of language, really gives insurance adjusters a huge amount of control to determine scope of work and to deny legitimate estimates,” O’Driscoll said.
“From the insurance industry’s perspective, it doesn’t give us any different kind of power. We just think it gives power back to the consumer when they’re in a situation being ripped off by an unscrupulous contractor,” said Carole Walker, executive director of the Rocky Mountain Insurance Association.
The insurance industry, Colorado Roofers Association, the Colorado Roofing and Restoration Council, and the Subcontractors association are backing the bill. They believe it gives consumers some recourse in dealing with roofing contractors.
“If I write an estimate, it differs from an insurance adjuster’s, it could be very different, as in he wants to replace one slope of a damaged roof, and I think the whole roof needs to be done. Traditionally, we would work that together, we would come to some kind of agreement. Under SB 12-038) if he disagrees with me, and he denies the claim in part, during rescission window, they can put pressure on a consumer to use another contractor or to cancel their contract with me,” O’Driscoll explained.
“The big concern is now you’re in a contract, you don’t have insurance money to pay for it, you’re still in that contract with that roofer, Senate Bill 38 will give that power back to the consumer,” Walker said.
The intent of the bill is to protect the consumer and both sides are passionate about whether it achieves that goal.
“This is written wrong, this is not for the consumer, it’s not best for the consumer,” O’Driscoll said.
“Your insurance company has as much investment as you in having a good roof,” Walker said.
Now it will be up to the Governor to decide whether the bill will become law.