HB3034 EngrossedLRB097 09449 AEK 49584 b

1    AN ACT concerning business.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Home Repair and Remodeling Act is amended by
5adding Section 18 and by changing Section 20 as follows:
 
6    (815 ILCS 513/18 new)
7    Sec. 18. Repairs following damaging weather.
8    (a) As used in this Section, "catastrophe" means a natural
9occurrence, including but not limited to flood, drought,
10earthquake, tornado, windstorm, or hailstorm, which damages or
11destroys more than one residence.
12    (b) A contractor offering home repair or remodeling
13services shall not advertise or promise to pay or rebate all or
14any portion of any insurance deductible as an inducement to the
15sale of goods or services. As used in this Section, a promise
16to pay or rebate includes granting any allowance or offering
17any discount against the fees to be charged or paying the
18insured or any person directly or indirectly associated with
19the property any form of compensation.
20    (c) A contractor offering home repair or remodeling
21services shall not accept money or any form of compensation in
22exchange for allowing an out of area contractor to use its
23business name or license.

 

 

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1    (d) A contractor offering home repair or remodeling
2services shall include its Illinois State roofing contractor
3license name and number as it appears on its Illinois State
4roofing license on all contracts, bids, and advertisements
5involving roofing work as required by the Illinois Roofing
6Industry Licensing Act.
7    (e) A person who has entered into a written contract with a
8contractor offering home repair or remodeling services to
9provide goods or services to be paid from the proceeds of a
10property and casualty insurance policy may cancel the contract
11prior to midnight on the earlier of the fifth business day
12after the insured has received written notice from the insurer
13that all or any part of the claim or contract is not a covered
14loss under the insurance policy or the thirtieth business day
15after receipt of a properly executed proof of loss by the
16insurer from the insured. Cancellation is evidenced by the
17insured giving written notice of cancellation to the contractor
18offering home repair or remodeling services at the address
19stated in the contract. Notice of cancellation, if given by
20mail, is effective upon deposit into the United States mail,
21postage prepaid and properly addressed to the contractor.
22Notice of cancellation may be given by delivering or mailing a
23signed and dated copy of the written notice of cancellation to
24the contractor's business address as stated in the contract.
25Notice of cancellation shall include a copy of the written
26notice from the insurer to the effect that all or part of the

 

 

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1claim is not a covered loss under the insurance policy. Notice
2of cancellation need not take a particular form and is
3sufficient if it indicates, by any form of written expression,
4the intention of the insured not to be bound by the contract.
5    (f) Any contract referred to in subsection (e), must
6contain a statement in at least 10 point boldface, in
7substantially the following form:
8        "You may cancel this contract at any time before
9        midnight on the earlier of the fifth business day after
10        you have received written notification from your
11        insurer that all or any part of the claim or contract
12        is not a covered loss under the insurance policy or the
13        thirtieth business day after your insurer has received
14        properly executed proof(s) of loss from you. See
15        attached notice of cancellation form for an
16        explanation of this right."
17    (g) Upon executing a contract referred to in subsection
18(e), furnish each insured a fully completed form in duplicate,
19captioned "NOTICE OF CANCELLATION", which shall be attached to
20the contract but easily detachable, and which shall contain
21boldface type of a minimum size of 10 points the following
22statement with the appropriate fields completed by the
23contractor:
24        
"NOTICE OF CANCELLATION
25            If you are notified by your insurer that all or any
26        part of the claim or contract is not a covered loss

 

 

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1        under the insurance policy, you may cancel the contract
2        by mailing or delivering a signed and dated copy of
3        this cancellation notice or any other written notice to
4        (name of contractor) at (address of contractor's place
5        of business) at any time prior to midnight on the
6        earlier of the fifth business day after you have
7        received such notice from your insurer or the thirtieth
8        business day after your insurer has received properly
9        executed proof(s) of loss from you. If you cancel, any
10        payments made by you under the contract, other than
11        payments for goods or services related to a catastrophe
12        which you agreed in writing to be necessary to prevent
13        damage to your property, will be returned to you within
14        10 business days following receipt by the contractor of
15        your cancellation notice.
16            I HEREBY CANCEL THIS TRANSACTION
17            ................................
18            (date)
19            ................................
20            (insured's signature)".
21    (h) Within 10 days after a contract referred to in
22subsection (e) has been cancelled, the contractor offering home
23repair or remodeling services shall tender to the insured any
24payments, partial payments, or deposits made by the insured and
25any note or other evidence of indebtedness. If, however, the
26contractor has provided any goods or services related to a

 

 

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1catastrophe, acknowledged and agreed to by the insured in
2writing to be necessary to prevent damage to the premises, the
3contractor is entitled to the reasonable value of such goods
4and services. Any provision in a contract referred to in
5subsection (e) that requires the payment of any fee for
6anything except goods or services related to a catastrophe
7shall not be enforceable against any insured who has cancelled
8a contract pursuant to this Section.
9    (i) A contractor offering home repair or remodeling
10services shall not represent, or offer or advertise to
11represent, on behalf of a homeowner on any insurance claim in
12connection with the repair or replacement of roof systems, or
13the performance of any other exterior repair, replacement,
14construction or reconstruction work; or otherwise violate the
15Public Adjusters Law. A contractor offering home repair or
16remodeling services shall not call in or file a claim to an
17insurance carrier on the insured's behalf. A contractor
18offering home repair or remodeling services shall not climb on
19a roof or inspect for exterior damage without the insured's
20express permission. Nothing in this subsection shall be
21construed to prohibit a residential contractor from: (1)
22providing an insured an estimate for repair, replacement,
23construction, or reconstruction of the insured's property and
24any such estimate may be submitted to the insured's insurance
25company; (2) conferring with an insurance company's
26representative about damage to an insured's property; or (3)

 

 

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1discussing repair or replacement options with an insurance
2company's representative or the insured about options for the
3repair or replacement of the damage.
 
4    (815 ILCS 513/20)
5    Sec. 20. Consumer rights brochure.
6    (a) For any contract over $1,000, any person engaging in
7the business of home repair and remodeling shall provide to its
8customers a copy of the "Home Repair: Know Your Consumer
9Rights" pamphlet prior to the execution of any home repair and
10remodeling contract. The consumer shall sign and date an
11acknowledgment form entitled "Consumer Rights Acknowledgment
12Form" that states: "I, the homeowner, have received from the
13contractor a copy of the pamphlet entitled 'Home Repair: Know
14Your Consumer Rights.'" The contractor or his or her
15representative shall also sign and date the acknowledgment
16form, which includes the name and address of the home repair
17and remodeling business. The acknowledgment form shall be in
18duplicate and incorporated into the pamphlet. The original
19acknowledgment form shall be retained by the contractor and the
20duplicate copy shall be retained within the pamphlet by the
21consumer.
22    (b) For any contract for $1,000 or under, any person
23engaging in the business of home repair and remodeling shall
24provide to its customers a copy of the "Home Repair: Know Your
25Consumer Rights" pamphlet. No written acknowledgment of

 

 

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1receipt of the pamphlet is required for a contract of $1,000 or
2under.
3    (c) The pamphlet must be a separate document, in at least
412 point type, and in legible ink. The pamphlet shall read as
5follows:
 
6
"HOME REPAIR: KNOW YOUR CONSUMER RIGHTS

 
7    As you plan for your home repair/improvement project, it is
8important to ask the right questions in order to protect your
9investment. The tips in this fact sheet should allow you to
10protect yourself and minimize the possibility that a
11misunderstanding may occur.
 
12
AVOIDING HOME REPAIR FRAUD

 
13Please use extreme caution when confronted with the following
14warning signs of a potential scam:
15    (1) Door-to-door salespersons with no local connections
16who offer to do home repair work for substantially less than
17the market price.
18    (2) Solicitations for repair work from a company that lists
19only a telephone number or a post-office box number to contact,
20particularly if it is an out-of-state company.
21    (3) Contractors who fail to provide customers references
22when requested.

 

 

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1    (4) Persons offering to inspect your home for free. Do not
2admit anyone into your home unless he or she can present
3authentic identification establishing his or her business
4status. When in doubt, do not hesitate to call the worker's
5employer to verify his or her identity.
6    (5) Contractors demanding cash payment for a job or who ask
7you to make a check payable to a person other than the owner or
8company name.
9    (6) Offers from a contractor to drive you to the bank to
10withdraw funds to pay for the work.
 
11
CONTRACTS

 
12    (1) Get all estimates in writing.
13    (2) Do not be induced into signing a contract by
14high-pressure sales tactics.
15    (3) Never sign a contract with blank spaces or one you do
16not fully understand. If you are taking out a loan to finance
17the work, do not sign the contract before your lender approves
18the loan.
19    (4) Remember, you have 3 business days from the time you
20sign your contract to cancel any contract if the sale is made
21at your home. The contractor cannot deprive you of this right
22by initiating work, selling your contract to a lender, or any
23other tactic.
24    (5) If the contractor does business under a name other than

 

 

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1the contractor's real name, the business must either be
2incorporated or registered under the Assumed Business Name Act.
3Check with the Secretary of State to see if the business is
4incorporated or with the county clerk to see if the business
5has registered under the Assumed Business Name Act.
6    (6) Homeowners should check with local and county units of
7government to determine if permits or inspections are required.
8    (7) Determine whether the contractor will guarantee his or
9her work and products.
10    (8) Determine whether the contractor has the proper
11insurance.
12    (9) Do not sign a certificate of completion or make final
13payment until the work is done to your satisfaction.
14    (10) Remember, homeowners should know who provides
15supplies and labor for any work performed on your home.
16Suppliers and subcontractors have a right to file a lien
17against your property if the general contractor fails to pay
18them. To protect your property, request lien waivers from the
19general contractor.
 
20
BASIC TERMS TO BE INCLUDED IN A CONTRACT

 
21    (1) Contractor's full name, address, and telephone number.
22Illinois law requires that persons selling home repair and
23improvement services provide their customers with notice of any
24change to their business name or address that comes about prior

 

 

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1to the agreed dates for beginning or completing the work.
2    (2) A description of the work to be performed.
3    (3) Starting and estimated completion dates.
4    (4) Total cost of work to be performed.
5    (5) Schedule and method of payment, including down payment,
6subsequent payments, and final payment.
7    (6) A provision stating the grounds for termination of the
8contract by either party. However, the homeowner must pay the
9contractor for work completed. If the contractor fails to
10commence or complete work within the contracted time period,
11the homeowner may cancel and may be entitled to a refund of any
12down payment or other payments made towards the work, upon
13written demand by certified mail.
14    (7) A provision stating the grounds for termination of the
15contract if you are notified by your insurer that all or any
16part of the claim or contract is not a covered loss under the
17insurance policy, you may cancel the contract by mailing or
18delivering written notice to (name of contractor) at (address
19of contractor's place of business) at any time prior to
20midnight on the fifth business day after you have received such
21notice from your insurer. If you cancel, any payments made by
22you under the contract will be returned to you within 10
23business days following receipt by the contractor of your
24cancellation notice. If, however, the contractor has provided
25any goods or services related to a catastrophe, acknowledged
26and agreed to by the insured homeowner in writing to be

 

 

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1necessary to prevent damage to the premises, the contractor is
2entitled to the reasonable value of such goods and services.
3    Homeowners should obtain a copy of the signed contract and
4keep it in a safe place for reference as needed.
5    To file a complaint against a roofing contractor, contact
6the Illinois Department of Financial and Professional
7Responsibility at 312-814-6910 or file a complaint directly on
8its website.
 
9
IF YOU THINK YOU HAVE BEEN DEFRAUDED OR YOU HAVE QUESTIONS
10    If you think you have been defrauded by a contractor or
11have any questions, please bring it to the attention of your
12State's Attorney or the Illinois Attorney General's Office.
13Attorney General Toll-Free Numbers
14Carbondale        (800) 243-0607
15Springfield        (800) 243-0618
16Chicago            (800) 386-5438".
17(Source: P.A. 91-230, eff. 1-1-00.)