ENROLLED
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ACT No. 193
Regular Session, 2012
HOUSE BILL NO. 386
BY REPRESENTATIVE PONTI
AN ACT1
To amend and reenact R.S. 37:2175.1(A)(introductory paragraph), 2175.2(C), and 2175.3(B)2
and to enact R.S. 37:2175.1(A)(6) and (7), (D), and (E) and 2175.3(A)(9) and (10),3
relative to home improvement contracting in connection with the repair or4
replacement of a roof system; to provide for definitions; to lower the minimum5
threshold amount for home improvement contracting; to provide for a right to cancel6
a contract for home improvement contracting; to require notice of the right to cancel;7
to provide for refund of payments; to require proof of general liability insurance in8
a minimum amount; to prohibit a home improvement contractor from advertising or9
promising to pay or rebate all or any portion of an applicable insurance deductible10
as an inducement to the sale of goods or service; to provide for nullification of the11
contract and a cause of action for violations; to provide for an unfair trade practice12
violation; to provide for remedies for violations; and to provide for related matters.13
Be it enacted by the Legislature of Louisiana:14
Section 1. R.S. 37:2175.1(A)(introductory paragraph), 2175.2(C), and 2175.3(B) are15
hereby amended and reenacted and R.S. 37:2175.1(A)(6) and (7), (D), and (E) and16
2175.3(A)(9) and (10) are hereby enacted to read as follows: 17
§2175.1. Home improvement contracting; written contract required; right to cancel18
A. Every agreement to perform home improvement contracting services, as19
defined by this Part, in an amount in excess of seventy- five one thousand five20 ENROLLEDHB NO. 386
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hundred dollars, but not in excess of seventy-five thousand dollars, shall be in1
writing and shall include the following documents and information:2
* * *3
(6) If the contract is for goods or services in connection with the repair or4
replacement of a roof system to be paid from the proceeds of a property or casualty5
insurance policy, a statement in boldface type of a minimum size of ten points, in6
substantially the following form:7
"You may cancel this contract in connection with the repair or replacement8
of a roof system at any time within seventy-two hours after you have been notified9
that your insurer has denied all or any part of your claim to pay for the goods and10
services to be provided under this contract. See attached notice of cancellation form11
for an explanation of this right."12
(7) If the contract is for goods or services in connection with the repair or13
replacement of a roof system to be paid from the proceeds of a property or casualty14
insurance policy, a fully completed form in duplicate, captioned "NOTICE OF15
CANCELLATION", which shall be attached to the contract but easily detachable,16
and which shall contain, in boldface type of a minimum size of ten points, the17
following statement:18
"NOTICE OF CANCELLATION19
If your insurer denies all or any part of your claim to pay for goods and20
services in connection with the repair or replacement of a roof system to be provided21
under this contract, you may cancel the contract by mailing or delivering a signed22
and dated copy of this cancellation notice or any other written notice to (name of23
home improvement contractor) at (address of contractor's place of business) at any24
time within seventy-two hours after you have been notified that your claim has been25
denied. If you cancel, any payments made by you under the contract, except for26
certain emergency work already performed by the contractor, shall be returned to27
you within ten business days following receipt by the contractor of your cancellation28
notice.29 ENROLLEDHB NO. 386
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I HEREBY CANCEL THIS TRANSACTION1
____________________________2
(Date)3
____________________________4
(Insured's Signature)"5
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D.(1) A person who has entered into a written contract with a home7
improvement contractor to provide goods or services in connection with the repair8
or replacement of a roof system to be paid from the proceeds of a property or9
casualty insurance policy may cancel the contract within seventy-two hours after the10
insured party has been notified by the insurer that all or any part of the claim has11
been denied. Cancellation shall be evidenced by the insured party giving written12
notice of cancellation to the home improvement contractor at the address stated in13
the contract. Notice of cancellation, if given by mail, shall be by certified mail,14
return receipt requested, and shall be effective upon deposit into the United States15
mail, postage prepaid, and properly addressed to the home improvement contractor.16
Notice of cancellation need not take a particular form and shall be sufficient if it17
indicates, by any form of written expression, the intention of the insured party not18
to be bound by the contract.19
(2) Within ten days after a contract referred to in this Subsection has been20
cancelled, the home improvement contractor shall tender to the owner or possessor21
of the residential real estate any payments, partial payments, or deposits made by the22
insured party and any note or other evidence of indebtedness. If, however, the home23
improvement contractor has performed any emergency services, acknowledged by24
the insured in writing to be necessary to prevent damage to the premises, the home25
improvement contractor shall be entitled to the reasonable value of such services.26
E. For the purposes of this Part, "roof system" means the components of a27
roof, including but not limited to covering, insulation, and ventilation.28
§2175.2. Home improvement contracting; registration required29
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C. The applicant shall furnish the board proof of general liability insurance1
in a minimum amount of one hundred thousand dollars, proof of workers'2
compensation insurance, and proof of registration with the Department of Revenue3
by providing a certificate of resident/nonresident status.4
* * *5
§2175.3. Home improvement contracting; prohibited acts; violations6
A. The following acts are prohibited by persons performing home7
improvement contracting services:8
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(9) Advertising or promising to pay or rebate all or any portion of an10
applicable insurance deductible as an inducement to the sale of goods or services in11
connection with the repair or replacement of a roof system. For the purposes of this12
Section, a promise to pay or rebate the insurance deductible shall include granting13
any allowance or offering any discount against the fees to be charged or paying the14
insured party any form of compensation for any reason, including but not limited to15
permitting the home improvement contractor to display a sign or any other type of16
advertisement at the insured party's premises, or paying an insured party for17
providing a letter of referral or recommendation. If a home improvement contractor18
violates this Paragraph:19
(a) The insurer to whom the insured party tendered the claim shall not be20
obligated to consider the estimate prepared by the home improvement contractor.21
(b) The insured party or the applicable insurer may bring an action against22
the home improvement contractor in a court of competent jurisdiction for damages23
sustained as a result of the home improvement contractor's violation.24
(10) Failing to obtain any insurance required by federal law.25
B.(1) Violations of this Section shall subject the violator to the26
administrative sanctions as prescribed in this Part.27
(2) A violation of Paragraph (A)(9) of this Section shall constitute a28
prohibited practice under the Unfair Trade Practices and Consumer Protection Law,29 ENROLLEDHB NO. 386
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R.S. 51:1401 et seq., and shall be subject to the enforcement provisions of that1
Chapter.2
SPEAKER OF THE HOUSE OF REPRESENTATI VES
PRESIDENT OF THE SENATE
GOVERNOR OF THE STATE OF LOUISIANA
APPROVED: