Home Improvement Contractors - Disaster Mitigation Services and Fraudulent Insurance Acts - Regulation and Prohibition
HB1351 expands Maryland’s home improvement law to treat certain disaster mitigation work as a regulated “home improvement.” The bill defines disaster mitigation services to include boarding up openings, demolition to prevent further damage, water mitigation equipment setup, tarping or caulking roofs, and securing walls or roofs after damage. It also adds related work such as tree removal and water remediation to the broader home improvement definition, bringing those services within the licensing and contract rules that apply to home improvement contractors and salespersons.
The bill creates a temporary licensing exemption through November 1, 2028, for certain contractors providing disaster mitigation services if they are substantially working toward a license and, if they are business entities, were formed or registered in Maryland by October 1, 2026. It also requires disaster-mitigation contracts to include a notice of the owner’s right to rescind, and it gives owners a special rescission period: 5 days for owners under 65 and 7 days for owners 65 or older. Counties and Baltimore City are authorized to limit in-person solicitation of disaster victims, including by time and location. In addition, the bill amends Maryland insurance law to make it a fraudulent insurance act for a contractor or service provider to give an insured or claimant a payment, referral fee, rebate, gift, or anything of value in connection with a residential repair or replacement claim, while preserving the ability to pay referral fees or commissions to other contractors or business entities.
The bill amends the Business Regulation Article and the Insurance Article, primarily affecting the Maryland Home Improvement Commission’s licensing and contract disclosure framework and the state’s fraudulent insurance act provisions. It broadens the scope of regulated home improvement work, imposes new contract language and consumer rescission rights for disaster mitigation services, and authorizes local governments to regulate solicitation practices after disasters. Contractors, homeowners, and insurers involved in residential repair and restoration work would be directly affected, especially in post-disaster settings.
The available voting history suggests the bill was generally supported in the House, passing third reading by a wide margin. A floor amendment was rejected, indicating some disagreement over changes proposed late in the process, but the underlying bill still advanced comfortably. No committee transcript excerpts are available, so the record mainly reflects broad legislative support with at least one unsuccessful attempt to alter the bill.
The main points of contention appear to center on how far the bill should go in regulating post-disaster solicitation and contractor conduct, and whether the new consumer protections and insurance-fraud rules are too broad or too restrictive. The rejected floor amendment suggests at least some members wanted to modify the bill’s approach, though the specific objection is not provided. Potentially sensitive issues include the temporary licensing exemption for disaster mitigation contractors, the age-based rescission periods, and the prohibition on payments or gifts to insureds or claimants in connection with residential insurance claims.