How to Choose a Water Damage Company: Checks, Questions and Red Flags

To choose a water damage company, confirm it is listed in the IICRC Global Locator, ask for proof of general liability insurance and any license your state requires, and get a written, itemized estimate before any work beyond emergency water removal. Then rule out anyone who asks you to sign over your insurance check or benefits, pay the whole job up front, or sign today to get a discount. The FTC lists each of those as a sign of a scam.

Start with IICRC certification

The Institute of Inspection, Cleaning and Restoration Certification (IICRC) writes the ANSI/IICRC S500 Standard for Professional Water Damage Restoration, the industry's written procedure for how drying should be done. It also certifies technicians and firms.

The IICRC Global Locator on iicrc.org lets homeowners search for certified firms and technicians by location. To register as an IICRC Certified Firm, a company needs at least one active IICRC certified technician and current general liability insurance, so the listing tells you two useful things at once.

Check the exact business name, not just the logo on a website or truck. IICRC keeps a public Invalid Firms page naming companies that used its logo without being registered as Certified Firms. If a company claims certification but does not appear in the locator, ask for the technician's certification number and look that up instead.

Licensing, insurance and paperwork

Licensing rules for water mitigation and mold work vary by state, and some states require a general contractor license for the rebuild. The FTC advises confirming a contractor's license and insurance with your state or county government, and warns that scammers often claim they do not need a license for the work.

Ask for a certificate of insurance showing general liability coverage, and workers' compensation if your state requires it. A legitimate company can email one within minutes.

Questions to ask on the phone

These questions take about five minutes and tell you most of what you need. A good company answers them plainly.

What to have ready when you call

The S500 standard asks restorers to gather basic facts at the first call so they can send the right crew and equipment. You will get a better answer faster if you have these ready:

• where the water came from and whether it has been shut off
• when it started, or when you first noticed it
• how many rooms and floors are wet
• whether the water could contain sewage or outside floodwater
• what got wet: carpet, hardwood, drywall, ceilings, cabinets
• the age of the house and any earlier water damage
• your insurance company and whether you have opened a claim

A company that asks you most of these questions without being prompted is usually one that follows the standard on site too.

Red flags that mean walk away

Storm chasers and door knockers

The FTC says unlicensed contractors and scammers often show up in recovery areas after storms and floods, and advises being skeptical of anyone promising immediate cleanup or repairs. A truck with out-of-state plates, no local address and a crew going door to door is a reason to slow down and verify.

Pressure tactics and payment demands

The FTC's list of scam signs includes being offered a discount only if you sign right away, being asked to sign over your insurance check, being asked to pay for everything up front, being told to pay by wire transfer, gift card, payment app, cryptocurrency or cash, and being asked to sign a blank contract. The Insurance Information Institute adds a warning about contractors whose bids are very low, since they may cut corners.

Assignment of benefits pressure

An assignment of benefits, or AOB, transfers your insurance claim rights to a third party. The Florida Department of Financial Services explains that an AOB gives that third party authority to file a claim, make repair decisions and collect insurance payments without your involvement. It also says plainly that you do not need to sign an AOB to get your claim processed or your home repaired.

Florida now prohibits assigning post-loss benefits under residential and commercial property policies issued or renewed on or after January 1, 2023, but AOB forms still circulate in other states, sometimes buried in a work authorization. Before signing anything on day one, look for the words assign, assignment or direction to pay.

Reading the contract

The FTC says to get a written contract even if your state does not require one, and to check that it includes:

• the company's name, address, phone and license number, if one is required
• estimated start and completion dates
• a payment schedule
• any promises made by phone or in person, such as scope of work and costs
• a written notice of your right to cancel within three business days if you signed at home
• no blank spaces anyone could fill in later

Pay by credit card or check. For larger insured jobs, the FTC suggests asking your bank or credit union about a Certificate of Completion arrangement, where the bank pays the contractor for each stage only after you approve it.

Speed now, comparison shopping later

Water damage has two phases. The first is mitigation: stopping the water, extracting it and drying the structure. The second is restoration: replacing drywall, flooring and finishes. The difference is explained in water mitigation vs restoration.

For the first phase, waiting days to collect bids usually costs more than it saves, because wet materials start growing mold within 24 to 48 hours. For the second phase, there is time to compare written estimates. The Insurance Information Institute also reminds homeowners that payments for temporary repairs count toward the total settlement, so overpaying for the emergency stage can leave less for permanent repairs. Our guides on typical water damage restoration costs and water damage insurance claim tips help you judge whether an estimate is reasonable.

You can also browse restoration companies by state and city in the water damage restoration directory.

One free call connects you with an independent local restoration company. Ask them the questions in the table above before they come out. Lines are open 24/7 and there is no obligation to hire.