Relates to home improvement contract provisions

5 Co-sponsors

• Rich Funke
• Jesse Hamilton
• George Latimer
• Diane J. Savino
• James L. Seward

Title of bill

An act to amend the general business law, in relation to home improvement contract provisions

Purpose

Requires home improvement contractors to have insurance coverage and regulates their conduct when making repairs covered by homeowner's insurance.

Summary of provisions

Section 1: Amends paragraphs (d) and (e) of subdivision 3 of section 770 of the general business law, as amended by chapter 32 of the laws of 1989. Adds three new paragraphs (f), (g), and (h) to subdivision 3 of section 770 of the general business law.

Section 2: Amends Paragraph (h) of subdivision 1 of section 771 of the general business law. Adds a new paragraph (i) to subdivision 1 of section 771 of the general business law.

Section 3: Adds new subdivisions 3,4, 5, 6, 7, 8, and 9 to section 771 of the general business law. Section 4: Adds section 771-B to the general business law. Section 5: Establishes the effective date.

Justification

While the vast majority of home improvement contractors are honest and scrupulous businesspersons, there is a very small group of people who present themselves as legitimate contractors but are actually con artists. These illegitimate groups of people are commonly known as "storm chasers" who come into an area right after a natural disaster, promising to quickly and efficiently restore the properties of people who have suffered damage and loss from the disaster. Storm chasers end up either performing extremely substandard work or do not even perform the work. These con artists will often walk door to door in a neighborhood and use high-pressure sales tactics to compel consumers into signing home repair contracts. A particular target for storm chasers is the elderly, especially those who have paid off their mortgage because if the mortgage is not paid off then the insurer must include the mortgage holder (usually a bank) on the check.

This proposed legislation would establish a prohibition on home improvement contractors advertising or promising to pay or rebate all or any part of an insurance deductible as an inducement to the sale of any goods or services. The measure allows a residential property owner to cancel a home improvement contract within 3 business days after receiving notice from the owner's insurer that the claim has been denied in whole or in part. Within 10 (ten) days after cancellation, the home improvement contractor is required to return any payments made by the insured and note or evidence of indebtedness. The contractor would be entitled to compensation for their work on emergency repairs.

Legislative history

This is a new bill.

Fiscal implications

None to the State.

Effective date

This act shall take effect 180 days after enactment.