Bill Text: MS HB613 | 2014 | Regular Session | Introduced
Bill Title: Roofing contracts; revise obligations of contractors for insurance purposes.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2014-02-04 - Died In Committee [HB613 Detail]
Download: Mississippi-2014-HB613-Introduced.html
MISSISSIPPI LEGISLATURE
2014 Regular Session
To: Judiciary A
By: Representative DeLano
House Bill 613
AN ACT TO REQUIRE ROOFING CONTRACTORS TO MAKE CERTAIN DISCLOSURES TO POLICYHOLDERS WHEN MAKING CONTACT WITH INDIVIDUALS FOR PURPOSES OF SOLICITING ROOFING SERVICES; TO STIPULATE THE TERMS TO BE INCLUDED IN A CONTRACT FOR ROOFING SERVICES; TO PROVIDE THE POLICYHOLDER AN OPPORTUNITY TO CANCEL THE CONTRACT FOR ROOFING SERVICES WITHIN SEVENTY-TWO HOURS AFTER RECEIVING WRITTEN NOTICE FROM THE INSURANCE COMPANY THAT THE CLAIM HAS BEEN DENIED; TO PRESCRIBE THE PROCEDURE AND FORM UPON WHICH NOTICE OF CANCELLATION SHALL BE PROVIDED TO THE ROOFING CONTRACTOR; TO REQUIRE THE ROOFING CONTRACTOR TO TENDER TO THE POLICYHOLDER ANY PAYMENTS MADE BY THE POLICYHOLDER WITHIN TEN DAYS AFTER CANCELLATION BECOMES EFFECTIVE, EXCEPT IN THE EVENT THAT EMERGENCY SERVICES HAVE BEEN PROVIDED; TO PRESCRIBE CIVIL AND CRIMINAL PENALTIES FOR ROOFING CONTRACTORS WHO VIOLATE PROVISIONS OF THIS ACT; TO AMEND SECTIONS 75-24-5 AND 75-24-91, MISSISSIPPI CODE OF 1972, IN CONFORMITY TO THE PROVISIONS OF THIS ACT; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. As used in this act, the following terms shall have the meanings herein ascribed, unless the context clearly indicates otherwise:
(a) "Roofing contractor" means:
(i) Any person, including a subcontractor and nonresident contractor or subcontractor, engaged in the business of commercial or residential roofing services for a fee; or
(ii) Any person who offers to engage in or solicits roofing-related services, including construction, installation, renovation, repair, maintenance, alteration and waterproofing.
"Roofing contractor" shall not mean a person engaged in the demolition of a structure or the cleanup of construction waste and debris that contains roofing material or a person working under the direct supervision of the roofing contractor who is hired either as an employee, day laborer or contract laborer.
(b) "Nonresident contractor" means any contractor or subcontractor who:
(i) Has not established and maintained a place of business as a roofing contractor in this state within the
preceding year;
(ii) Claims residency in another state; or
(iii) Has not submitted a franchise and
excise tax return as a resident of this state if a corporation or limited partnership within the preceding year.
SECTION 2. (1) (a) An individual, person or company contacting anyone for the purposes of soliciting roofing services in anticipation of making an insurance claim must disclose the following information to the policyholder:
(i) Whether or not the individual, person or company soliciting roofing repair services is a "nonresident contractor" as defined in Section 1 of this act;
(ii) The contractor license or registration number for any states in which they hold a contractors license; and
(iii) If the individual, person or company making the solicitation is not a "roofing contractor" as defined in Section 1 of this act, he or she must disclose that fact and the name and address of the company on behalf of which they are acting.
(b) The disclosures required under paragraph (a) of this subsection (1) must be orally communicated during any in-person or telephone solicitation, and must be provided in writing on any electronic or written solicitation. If made orally, the individual, person and company on behalf of which the solicitation is made, must maintain records documenting that the disclosure was made and retain that record for a period of two (2) years from the date of first contact with the policyholder.
(2) (a) An individual, person or company that prepares a repair estimate for roofing services in anticipation of making an insurance claim must disclose the following information to
the policyholder:
(i) A precise description and location of all damage claimed or included on the repair estimate;
(ii) Documentation to support the damage on the estimate, including, but not limited to, photos, digital images, or other media that is clearly labeled indicating slope/area on dwelling for inspection by the policyholder;
(iii) A detailed description and itemization of any emergency repairs already completed;
(iv) If damaged areas are not included on the repair estimate, a specification of those areas and any reason for their exclusion from the repair estimate;
(v) Whether or not the property was inspected before the preparation of the estimate and the nature of that inspection, specifically if the roof was physically accessed or not; and
(vi) That a contractor has made no assurances that the claimed loss will be covered by an insurance policy.
(b) The disclosures required under paragraph (a) of this subsection (2) must be made in writing, included on the repair estimate, signed and dated by the policyholder and provided along with any submission to an insurance company as part of a claim for damages, including any subsequent or supplemental claim for additional damage that is submitted or prepared for submission to an insurer.
(3) Any contract for roofing repairs shall contain the following:
(a) An itemized estimate of repair costs meeting the requirements of subsection (2) of this section, including the cost of raw materials, hourly labor rate and the number of hours for each item of repair or a unit cost basis; and
(b) A disclosure that the policyholder is responsible for payment for any work performed if the insurer denies payment or coverage on any part of the loss.
(4) (a) Any policyholder who has entered into a written contract with a roofing contractor to provide roofing goods and services to be paid by the policyholder from the proceeds of a property or casualty insurance policy has the right to cancel the contract within seventy-two (72) hours after the policyholder has received written notice from the insurance company that the claim has been denied, in whole or in part.
(b) Cancellation of the roofing contract shall be evidenced by the policyholder giving written notice of cancellation to the roofing contractor at the address stated in the contract. Notice of roofing contract cancellation, if given by mail, is effective upon deposit in a mailbox, properly addressed to the roofing contractor and postage prepaid. Notice of roofing contract cancellation need not take a particular form and is sufficient if it indicates, by any form of written expression, the intention of the policyholder not to be bound by the contract.
(5) Before entering a roofing contract, the roofing contractor must:
(a) Furnish the policyholder with a statement in boldface type of a minimum font size, in substantially the following form:
"You may cancel this contract at any time within three (3) business days after you have been notified that your insurance company has, in whole or in part, denied your claim to pay for the goods and services to be provided under this roofing contract. See attached notice of cancellation form for an explanation of this right."; and
(b) Furnish each policyholder a fully completed form in duplicate, captioned, "NOTICE OF CANCELLATION," which shall be attached to the roofing contract and easily detachable, and which shall contain in boldface type of a minimum font size, in substantially the following form:
"NOTICE OF CANCELLATION
If your insurance company, in whole or in part, denies your claim to pay for goods and services to be provided under this contract, you may cancel this roofing contract by mailing or delivering a signed and dated copy of this cancellation notice or any other written notice to (name of roofing contractor) at (address of roofing contractor's place of business) at any time within three (3) business days after you have been notified that your claim has been denied. If you cancel, any payments made by you under the contract will be returned within ten (10) business days following receipt by the roofing contractor of your roofing contract cancellation notice.
I HEREBY CANCEL THIS TRANSACTION.
(date)
(Policyholder's signature)."
(6) (a) In circumstances in which payment may be made from the proceeds of a property and casualty insurance policy, a roofing contractor shall not require any payments from a policyholder until the roofing contract cancellation period has expired.
(b) Within ten (10) days after a roofing contract has been cancelled, the roofing contractor must tender to the policyholder any payments made by the policyholder and any note or other evidence of indebtedness. However, if the roofing contractor has performed and the policyholder previously expressly agreed to any emergency services, the roofing contractor is entitled to reasonable compensation for the services provided as long as the policyholder has received a detailed description and itemization of charges for those services. Any provision in the roofing contract requiring payment of a fee for anything except
emergency services shall not be enforceable against any policyholder that has cancelled a roofing contract under this section.
SECTION 3. Any roofing contractor in violation of this section shall be subject to the civil and criminal penalties and remedies under Sections 74-25-19, 75-24-20 and 75-24-23, and may be liable under a private right of action of the consumer.
SECTION 4. Section 75-24-5, Mississippi Code of 1972, is amended as follows:
75-24-5. (1) Unfair methods of competition affecting commerce and unfair or deceptive trade practices in or affecting commerce are prohibited. Action may be brought under Section 75-24-5(1) only under the provisions of Section 75-24-9.
(2) Without limiting the scope of subsection (1) of this section, the following unfair methods of competition and unfair or deceptive trade practices or acts in the conduct of any trade or commerce are hereby prohibited:
(a) Passing off goods or services as those of another;
(b) Misrepresentation of the source, sponsorship, approval, or certification of goods or services;
(c) Misrepresentation of affiliation, connection, or association with, or certification by another;
(d) Misrepresentation of designations of geographic origin in connection with goods or services;
(e) Representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits, or quantities that they do not have or that a person has a sponsorship, approval, status, affiliation, or connection that he does not have;
(f) Representing that goods are original or new if they are reconditioned, reclaimed, used, or secondhand;
(g) Representing that goods or services are of a particular standard, quality, or grade, or that goods are of a particular style or model, if they are of another;
(h) Disparaging the goods, services, or business of another by false or misleading representation of fact;
(i) Advertising goods or services with intent not to sell them as advertised;
(j) Advertising goods or services with intent not to supply reasonably expectable public demand, unless the advertisement discloses a limitation of quantity;
(k) Misrepresentations of fact concerning the reasons for, existence of, or amounts of price reductions;
(l) Advertising by or on behalf of any licensed or regulated health care professional which does not specifically describe the license or qualifications of the licensed or regulated health care professional;
(m) Charging an
increased premium for reinstating a motor vehicle insurance policy that was
cancelled or suspended by the insured solely for the reason that he was
transferred out of this state while serving in the United States Armed Forces
or on active duty in the National Guard or United States Armed Forces Reserve.
It is also an unfair practice for an insurer to charge an increased premium for
a new motor vehicle insurance policy if the applicant for coverage or his
covered dependents were previously insured with a different insurer and
canceled that policy solely for the reason that he was transferred out of this
state while serving in the United States Armed Forces or on active duty in the
National Guard or United States Armed Forces Reserve. For purposes of
determining premiums, an insurer shall consider such persons as having maintained
continuous coverage. The provisions of this paragraph (m) shall apply only to
such instances when the insured does not drive the vehicle during the period of
cancellation or suspension of his policy * * *;
(n) Failing to comply with the requirements of the Mississippi Consumer Protection Act, Section 75-24-1 et seq., in contacting anyone for the purposes of soliciting roofing services in anticipation of making an insurance claim.
SECTION 5. Section 75-24-91, Mississippi Code of 1972, is amended as follows:
75-24-91. (1) The term "service contract," "home warranty" or "home service contract," as used in this section, means a contract or agreement for a separately stated consideration for a specific duration to perform the repair, replacement or maintenance of property or to reimburse, in whole or in part, the owner of such property for the repair, replacement or maintenance of property if the operational or structural failure is due to a defect in materials or manufacturing or to normal wear and tear. A service contract may contain a provision for incidental payment under such contract where service, repair or replacement is not feasible or economical. This subsection shall include and apply to the repair, replacement or maintenance of property performed by a roofing contractor in compliance with Sections 1 through 3 of this act.
(2) The marketing, sale, offering for sale, issuance, making, proposing to make and administration of a service contract is not a contract of insurance under Mississippi law and is exempt from the provisions of Title 83, Mississippi Code of 1972.
(3) Service contracts shall be subject to the provisions of the Mississippi Consumer Protection Act, Section 75-24-1 et seq.
(4) Nothing contained herein shall repeal or alter the regulation of vehicle service contracts currently defined and regulated under Section 83-65-101 et seq.
SECTION 6. This act shall take effect and be in force from and after July 1, 2014.
