House Bill 1408

(As Sent to Governor)

AN ACT TO AMEND SECTION 75-24-305, MISSISSIPPI CODE OF 1972, TO REVISE THE DEFINITION OF THE TERM "ROOF SYSTEM" UNDER THE INSURANCE BENEFITS ROOFING REPAIR CONSUMER PROTECTION ACT; TO AMEND SECTION 75-24-307, MISSISSIPPI CODE OF 1972, TO PROHIBIT A RESIDENTIAL ROOFING CONTRACTOR FROM REQUIRING PAYMENT UNTIL THE EXPIRATION OF THE CANCELLATION PERIOD; TO PROHIBIT A RESIDENTIAL ROOFING CONTRACTOR FROM REPRESENTING A PROPERTY OWNER ON INSURANCE CLAIMS AND FROM RECEIVING PAYMENT FROM AN ATTORNEY FOR CLAIM REFERRALS; TO PRESCRIBE CERTAIN REQUIREMENTS FOR A POST-LOSS ASSIGNMENT BY AN INSURED TO A RESIDENTIAL ROOFING CONTRACTOR; TO AMEND SECTION 75-24-311, MISSISSIPPI CODE OF 1972, TO CONFORM; AND FOR RELATED PURPOSES.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

SECTION 1. Section 75-24-305, Mississippi Code of 1972, is amended as follows:

75-24-305. As used in Sections 75-24-301 through 75-24-311:

(a) "Emergency services" means services performed with the express permission of the insured and that are immediately necessary for:

(i) The preservation of the residential real estate; or

(ii) The health of the insured, owner or possessor.

"Emergency services" does not include inspection of the residential roof system or an estimation of the repair costs.

(b) "Insured" means an insured whose name appears on the face of the property and casualty insurance policy that provides coverage for the residential roof system to be repaired.

(c) "Residential roofing contractor" means a person or entity contracting or offering to contract with an insured, owner or possessor of a residential roof system to repair or replace a roof system on residential real estate, or any portion thereof, where all or part of the cost is expected to be paid as a benefit of a property and casualty insurance policy.

(d) "Residential" means a new or existing dwelling constructed for habitation by one (1) to four (4) families, including a detached garage.

(e) "Insurance benefits residential roof system repair contract" means a written contract with an insured to repair a roof system, or any part thereof, on residential real estate, or provide goods and services in connection with such repair, that is to be paid in whole, or in part, under a property and casualty insurance policy.

(f) "Roof system" means roof coverings, roof sheathing, roof weatherproofing, roof framing, roof ventilation system, and insulation.

SECTION 2. Section 75-24-307, Mississippi Code of 1972, is amended as follows:

75-24-307. (1) Before signing an insurance benefits residential roof system repair contract with an insured, a residential roofing contractor shall furnish to the insured:

(a) The following statement in at least * * * ~~10‑point~~ 12-point boldface type that is attached to the contract:

"You may cancel this insurance benefits residential roof system repair contract at any time within three (3) business days after you have received written notice from your insurance company that all or any part of your claim, or all or part of the services and goods to be provided by this contract, is not a covered loss under your insurance policy. A notice of cancellation form is provided to you with this contract. To cancel this contract under these circumstances, sign and date, and then mail or deliver the attached Notice of Cancellation, or another similar written notice of cancellation, to the contractor within three (3) business days after you have received such written notice from your insurance company. If you cancel, any payments made under this residential roofing system repair contract, except for emergency services and repairs subsequently approved for payment by the insurance company and already performed by the contractor, will be returned to you within ten (10) business days following receipt by the contractor of your cancellation notice."; and

(b) Duplicate copies of a completed form captioned "NOTICE OF CANCELLATION" that is attached to the contract, is easily detachable, and contains the following in at least * * * ~~10‑point~~ 12-point boldface type:

"NOTICE OF CANCELLATION

(Name and address of contractor - to be entered by contractor)

(Date of contract - to be entered by contractor)

(Address of residential real estate to be repaired - to be entered by contractor)

I have been notified by my insurance company that all or any part of my claim, or the services and goods to be provided in the residential roofing system repair contract, is not a covered loss under the insurance policy.

I HEREBY CANCEL THIS TRANSACTION

Please return my prior payments within ten (10) days.

_______________________ _______________________

INSURED'S SIGNATURE DATE"

(2) (a) In circumstances in which payment may be made from the proceeds of a property and casualty insurance policy, a residential roofing contractor shall not require any payment from an insured until the three-day cancellation period has expired.

(b) Prior to a contract being executed for repairs made by a residential roofing contractor that are separate or additional to those repairs covered under the policy of insurance, the residential roofing contractor shall include a statement identifying those aspects of the repair or replacement which are separate from or additional to the repair or replacement of the damage to the roof system caused by a covered peril and explaining that payment of those excess or additional items are the insured's responsibility. This subsection does not limit an insured from communicating with the insurer about the estimated replacement cost of the repairs or replacement of the damaged roof system.

(3) Until the claim has been filed by the insured, a residential roofing contractor shall not represent or negotiate, or offer or advertise to represent or negotiate, on behalf of an owner or possessor of residential real estate on any insurance claim in connection with the repair or replacement of a roof system. This subsection does not prohibit an insured from including the residential roofing contractor in the insured's communications with the insurer about the damages to the roof system or the estimated replacement cost of the repairs or replacement of the damaged roof system at any point in the process. This subsection does not apply to a public adjuster licensed under Sections 83-17-501 through 83-17-527.

(4) (a) A residential roofing contractor shall not contract for, agree to, or receive anything of value from an attorney or other person acting in concert with an attorney for referring claims to the attorney or in connection with any claim for which the residential roofing contractor has performed or intends to perform services. A residential roofing contractor may not create a business relationship between an insured and an attorney or obligate an insured to hire a specified attorney.

(b) A residential roofing contractor shall not advertise or otherwise promise or offer to pay, or pay, or rebate all or any portion of an insured's insurance deductible as an inducement to enter into the residential roofing contract.

(5) A post-loss assignment by a named insured of rights or benefits to a residential roofing contractor under a property and casualty insurance policy insuring residential real estate shall authorize a residential roofing contractor only to be named as a co-payee for the payment of benefits under a property and casualty insurance policy covering residential real estate. The assignment shall include all of the following:

(a) An itemized description of the work to be performed;

(b) An itemized description of the materials, labor and fees for the work to be performed;

(d) A statement that the residential roofing contractor has made no assurances that the claimed loss will be covered fully by an insurance contract; and

(e) The following notice in capitalized fourteen-point type:

"You are agreeing to give up certain rights you have under your insurance policy. Please read and understand this document before signing. The itemized description of the work to be done shown in this assignment form has not been agreed to by the insurer. The insurer has the right to pay only for the cost to repair or replace damaged property caused by a covered peril."

(6) A copy of the executed assignment shall be provided to the insurer of the residential real estate no later than five (5) business days after the execution date of the assignment.

(7) The assignment shall not impair the interest of a mortgagee listed on the declarations page of the property and casualty insurance policy that is the subject of the assignment.

(8) An assignment shall not prevent or inhibit an insurer from communication with the named insured or mortgagee listed on the declarations page of the property and casualty insurance policy that is the subject of the assignment.

(9) A residential roofing contractor shall comply with all

applicable building codes when replacing, repairing, constructing or reconstructing a roof system.

(10) Pursuant to the terms of the insured's contract, nothing in this section shall be construed to prohibit a residential roofing contractor from:

(a) Providing an insured an estimate for repair, replacement, construction or reconstruction of the insured's property and any such estimate may be submitted to the insured's insurance company;

(b) Conferring with an insurance company's representative about damage to an insured's property; or

(c) Discussing repair or replacement options with an insurance company's representative or the insured about options for the repair or replacement of the damage.

SECTION 3. Section 75-24-311, Mississippi Code of 1972, is amended as follows:

75-24-311. (1) Any residential roofing contractor in violation of Sections 75-24-301 through 75-24-311 shall be subject to the civil and criminal penalties and remedies under Sections 75-24-19, 75-24-20 and 75-24-23, and may be liable under a private right of action of the consumer.

(2) A violation of Sections 75-24-301 through 75-24-311 by a residential roofing contractor is an unfair and deceptive act or practice as defined by the Mississippi Consumer Protection Law, Section 75-24-1 et seq.

(3) Sections 75-24-301 through 75-24-311 do not prohibit an insured that is harmed by a deceptive trade practice from commencing a civil action against a residential roofing contractor.

SECTION 4. This act shall take effect and be in force from and after July 1, 2024.