A company alledgedly offering government or council subsidies on hugely inflated quotes to insulate homes in Nelson is attracting a growing number of complaints and is “likely” to be breaching the Fair Trading Act.
Comfortmaster is a North Island-based business, which according to its advertising flyers, does home heating, insulation, LED lighting, ventilation, cooling and water filtration.
It has been cold-calling Nelsonians in the evening, asking if they’d like a free quote to insulate their home.
Nelson Weekly has spoken with four people who invited representatives of the company into their home to quote. For each of them the initial quote was around $6500 to $7000, which works out to be around $57 per square metre. The industry standard is about $17 per square metre.
The home owners were then told they were eligible for a government or council subsidy which would bring the initial quote down to around $4000, still about $30 per square metre.
Nelson City Council told the Weekly that it does not have any such subsidy or grant.
EECA, the government agency which offers the subsidies for home insulation, says Comfortmaster is not one of its contracted service providers and urged people not to fall for their “bullying tactics”.
But Comfortmaster says all of the residents have misunderstood the offer. It was, in fact, a discount offered by Comfortmaster because of their “superior buying power” and the over-inflated quotes were a mistake by staff.
Ross Wylie, who lives on Mount St in Nelson, says he was first contacted by Comfortmaster late last year. This month he agreed to a free quote.
He says the quote for his 121 square metre home was initially $7000 but that was reduced to $4071.45, “after the government discount”. But 20 square metres of his floor area was concrete and another 75 square metres was inaccessible for an installer. Meaning the area quoted should have only been around 25 square metres.
Ross believes Comfortmaster are unethical because they told him he could get a government subsidy and the amount quoted was about eight times more than he needed to pay.
“It’s very important for people to get a second quote. Very important. They’ve given a dishonest assessment when a human being couldn’t actually do the work,” he says.
More concerns over quotes:
Another man, who didn’t want to be identified for fear of retribution, spoke to Nelson Weekly last week just hours after he had a Comfortmaster representative at his house. He says he was offered a government subsidy if he had a Super Gold Card, a discount card for those over 65.
“They gave me a quote which was originally about $6500 or $7000, but we ended up with a figure of $3696 for this work [after the “subsidy”]. I said ‘that’s fine I’ll think about that,’ but in the meantime, can you give me a written quote. Well, did that provoke some interaction. Oh no, they didn’t do written quotes, it’s not company policy and he went into a long and most unconvincing explanation of why they didn’t do that.”
He says the man who came to his house described himself as a South Island assessor for Comfortmaster and he was accompanied by a woman and an unmarked vehicle.
“They also said the quote was only valid for 48 hours. I asked why and he said ‘oh, things change’, and I said ‘are you telling me that underfloor insulation is subject to daily changes in its price? Don’t be bloody ridiculous’.”
The man says he was offered both a government and council discount. “It was quite clear, and why would they take my Gold Card details if they didn’t [offer it]?”
Another man, called Brian, says he received a quote last year for his home in Stoke. He thought the price was “over the top” and was told that the quote was only valid for 48 hours, after which he would have to pay more, up to $1000.
“I said to my wife after he left, ‘I’m not too sure about this bugger’. I didn’t see how these prices stack up and why they were pressuring you into doing it fast.”
Nelson City Council has also had complaints to its staff, including a complaint from an elderly lady who had been offered a “council subsidised” insulation service. The initial quote was over $7000, but that was dropped to $4435.20 after the “subsidy” for her 90 square metre home. The quote was prepared by Comfortmaster.
“Likely” breach of act:
A Commerce Commission spokesperson says the practice of offering government subsidies when they are not authorised to do so is a likely breach of the Fair Trading Act.
“The Commission has not investigated this matter, but in general it would likely be a breach of the Fair Trading Act to say that a government agency subsidy is available, when it is not.
“Any claim of savings must be based on accurate information, as demonstrated in the recent Bike Barn case, where the two Bike Barn companies were fined $800,000 for exaggerated discount claims. Bike Barn claimed bikes were ‘half price’ when, typically, they were not. Consumers are urged to seek written quotes, and check price claims.”
Robert Linterman, the residential general manager for EECA, says Comfortmaster has never sought to become a government provider.
“It is a concern if they’re saying [they have subsidies] because they don’t. So what are they offering? Are they offering an inflated price and then putting a discount on it and saying ‘that’s the government subsidy’, when in actual fact it isn’t?”
He says that there may be “some legal avenues” his office could look at. “The pricing that we’re seeing from these guys is obviously over-the-top and all I can say is, for people in the marketplace, really look at getting another quote and don’t be bullied by these guys, because it is a bullying sales pitch. This is just poor commercial practice really and taking people for a ride.”
Comfortmaster area manager Marc Stewart responded to the allegations on Friday. He says people who have complained about being offered a government subsidy had “misunderstood” and that the “discount” is because of Comfortmaster’s buying power.
“The [insulation] product is certainly EECA-approved so they may be getting confused with that,” he says.
“There is a subsidy, but it’s a discount. It basically comes from Comfortmaster having around 80 per cent market share and it comes from getting the price from the manufacture down.”
He says Comfortmaster’s initial quotes are higher because they offer a superior product.
When told that all of the people spoken to by the Weekly had been quoted between $6500 to $7000 before the “discount”, and asked if that was a fair price to install underfloor insulation in a 120 square metre home, he acknowledged it wasn’t. “That sounds pretty high to me, I don’t know, I’d have to look at what he’s [another staff member] quoted on to be honest, but that sounds way too high.”
In a written statement on Monday, Marc says Comfortmaster have launched an investigation into the concerns raised.
“At Comfortmaster we pride ourselves on providing a quality product at a reasonable price.
“We have a team of five based here in Nelson, covering the West Coast and Marlborough regions, and they work with a maximum install price dependent on several factors. That price can be discounted based on a specific criteria including accessibility, labour required, the product used and the location of the home.
“We have launched an investigation and are grateful to be advised that customers felt there could be an issue. The contractor in question is standing down while we investigate. We are affiliated with several North Island councils and have installed under government programmes, however we do not do this in the South Island. Our clients are encouraged to seek a second opinion if they wish and can cancel at any stage without fee or penalty.”
‘You have to be honest’:
According to EECA, the only government-approved home insulation provider in Nelson is Absolute Energy. Its owner Paul Brockie says he has heard of a number of complaints about Comfortmaster. “We don’t mind competition at all, it’s what business is all about. But you have to be honest and up front. My message to people would be ‘don’t sign anything and get another quote’.”
Have you been contacted by Comfortmaster recently? If so, how did you find the experience? Email us at [email protected]