Insurance – Roofing

Understanding insurance:

The process of filing a claim and having a new roof installed can be intimidating and overwhelming. We want to make things easier for you by breaking down some of the key terms that you will run across in the process.

  • Insurance Premium: The amount of money an individual must pay for their insurance policy. It is important to note that homeowner’s insurance premiums are based on quite a few factors.  Lower-premium policies can be purchased for less coverage and a higher deductible, and higher premiums can include lower deductibles.  A homeowner’s previous claim history and even your neighborhood’s previous claim history (due to hail storms, etc.) can all affect how much you are paying each year for coverage.
  • Deductible: A specified amount of money that is subtracted from your insurance claim payout. Also, known as your out-of-pocket cost and is the homeowner’s portion of the claim that must be paid.
  • Insurance claim: A request to your insurance company asking for payment based on the terms of your insurance policy. Insurance will review the claim for its legitimacy and pays to the insured once approved.
  • Claims Adjuster: Someone who has been assigned your claim and investigates the insurance claim to determine the extent of the insurance company’s liability.
  • Replacement Cost Value (RCV): Total cost to make necessary repairs.  This amount is subject to change over the life of the claim based on any needed changes discovered through the process.
  • Actual Cash Value (ACV): Replacement cost value less the depreciation and deductible amount.
  • Recoverable Depreciation: This amount of value your property has lost due to age. This amount is withheld from the insurance company’s initial payment.  It is typically released once the contractor submits invoice to insurance company after the work has been completed.
  • NON-Recoverable Depreciation: Just like depreciation, this amount represents how much the value the property has lost, but is NOT covered under the usual Replacement Coverage of your insurance policy.  This amount is considered an additional out-of-pocket expense to the homeowner’s deductible.
  • Code Upgrade: Your current roofing system may have been installed decades ago and may not meet current code requirements provided by the county.  Reputable contractors may have to upgrade certain roofing elements so your property won’t fail inspection. This is covered by your insurance if you have code upgrade coverage.
  • Supplement: At some point during the claims process, additional items may be found to have been left off your adjuster’s initial estimate.  This could be due to human error and even previously unseen damage.  Supplements are sometimes requested before work begins or even after work has been completed, based on your insurance company’s requirements.