Residential roof contractors need to be aware of final amendments to a Mississippi state code that governs the interaction between a residential roofing contractor and a homeowner when insurance proceeds pay for some or all of a roof repair.

On May 8, Mississippi Gov. Tate Reeves approved an Act, HB 1408, to amend several sections within the Mississippi Code of 1972. The changes will take effect on July 1, 2024.

When payment by the insured may be made from the proceeds of an insurance policy, the roofing contractor cannot require any payment from the insured until the 3-day cancellation period has expired. This amends Section 75-24-307. Also amending the same section are the prohibiting of a residential roofing contractor from representing a property owner on insurance claims and from receiving payment from an attorney for claim referrals and prescribing certain requirements for a post-loss assignment by an insured to a residential roofing contractor.

The definition of the term “roof system” has also been revised under the Insurance Benefits Roofing Repair Consumer Protection Act, amending Section 75-24-305. As amended, “roof system” now means roof coverings, roof sheathing, roof weatherproofing, roof framing, roof ventilation system, and insulation.

Below is a full synopsis of items added to the statute that will affect residential roofing contractors.

1. The text size of the cancellation statement required in the roofing contract with the insured was changed from 10-point boldface type to 12-point boldface type.
2. When payment by the insured may be made from the proceeds of an insurance policy, the roofing contractor cannot require any payment from the insured until the 3-day cancellation period has expired.
3. In instances where the roofing contractor is performing repairs for the insured that are separate from those covered by the insurance policy, prior to the contract being executed, the roofing contractor must include a statement identifying the portions of the repair that are not covered by insurance and explain that these items are the responsibility of the insured.
4. A roofing contractor may not represent or negotiate or offer or advertise to represent or negotiate on behalf of the owner on a claim for repair or replacement of the roof until a claim has been filed by the insured. This does not prohibit the insured from including the roofing contractor in the insured’s communications with the insurer about the damage to the roof or the estimated cost or replacement or repairs. This does not apply to a property licensed public adjuster.
5. A roofing contractor may not contract for or agree to receive anything of value from an attorney or any other person acting in concert with an attorney for referring claims to the attorney.
6. A roofing contractor may not advertise or offer to pay, pay, or rebate all or a portion of the insured’s deductible as an inducement to enter into the roofing contract.
7. A post-loss assignment by the insured of rights or benefits to a roofing contractor under a P&C policy shall only authorize the roofing contractor to be named as a co-payee for the payment of benefits under the policy, and the assignment must include all of the following information: an itemized description of the work to be performed; an itemized description of the materials, labor, and fees for the work to be performed; a total itemized amount to be paid for the work to be performed; a statement that the roofing contractor has made no assurances that the claims loss will be covered fully by the policy; and a very specific notice must be included in capitalized 14-point font.
8. A copy of the executed assignment must be provided to the insurer no later than five (5) business days after the execution date of the assignment.
9. The assignment may not impair the interest of the mortgagee listed on the declarations page of the policy.
10. An assignment may not prevent or inhibit the insurer from communicating with the insured or mortgagee listed on the declarations page of the policy.
11. A roofing contractor must comply with all applicable building codes which replacing or repairing the roof.
12. In accordance with the terms of the insured’s contract, nothing in this section prohibits the roofing contractor from providing the insured an estimate for repair or replacement of the insured’s roof and any such estimate may be submitted to the insurer; conferring with the insurer’s representative about damage to the insured’s property; or discussing repair or replacement options with the insurer's representative or the insured.

Click here to read the full context of HB1408.

A reminder that we are less than two months away from these amendments becoming law on July 1 as part of the Mississippi state code. Should you have any questions about how these amendments impact your business, do not hesitate to contact myself or our construction team of professionals to provide clarity.