In June, I received hail damage to my home and had my house and garage reroofed in August. I have questions regarding insurance. My insurance paid $7947 ACV. After the repairs were done, I received an additional $2500 in Recoverable Depreciation. I just now received a bull from my roofing contractor, 2 months after the job was "completed". Prior to him starting the job, I requested a couple of times that he give me an itemized estimate for the work so that I could determine which work he would do and what I would do myself (replace screens, doors, restain deck). I never received those estimates. It is my impression that he wants all of the money for everything, although he only did the roofing. I can assure you that that won't happen. He stated that he would do the roofing for the insurance proceeds. I will give him the insurance proceeds that were allowed for roofing. Nothing else. My main question is this: is the roofer entitled to the ACV allowed for roofing, or is he entitled to ACV for roofing + Recoverable Depreciation for roofing?
Roofing/Insurance question
- Thread starter otis24
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I don't let anybody do anything without an estimate.
Originally Posted by Tdbo
Originally Posted by John_K
I don't let anybody do anything without an estimate.
In writing.
+2
Originally Posted by John_K
I don't let anybody do anything without an estimate.
In writing.
+2
Legally, he doesn't have a leg to stand on. Ask him for the signed contract stating the price of the job. Verbal agreements are only valid up to $500-$1000 depending on the state. You're fine with just paying him whatever the insurance agreed to on the roof. Of course the other things that didn't involve the roof he would have no right to and wouldn't be able to prove anything in court as he has nothing in writing and I don't see a judge giving him anything beyond what he did.
Originally Posted by Wolf359
Legally, he doesn't have a leg to stand on. Ask him for the signed contract stating the price of the job. Verbal agreements are only valid up to $500-$1000 depending on the state. You're fine with just paying him whatever the insurance agreed to on the roof. Of course the other things that didn't involve the roof he would have no right to and wouldn't be able to prove anything in court as he has nothing in writing and I don't see a judge giving him anything beyond what he did.
Ok. Agreed. Is he entitled to ACV or ACV + Recoverable Depreciation?
Legally, he doesn't have a leg to stand on. Ask him for the signed contract stating the price of the job. Verbal agreements are only valid up to $500-$1000 depending on the state. You're fine with just paying him whatever the insurance agreed to on the roof. Of course the other things that didn't involve the roof he would have no right to and wouldn't be able to prove anything in court as he has nothing in writing and I don't see a judge giving him anything beyond what he did.
Ok. Agreed. Is he entitled to ACV or ACV + Recoverable Depreciation?
His contract is with the insurance company, at least where I live.
Storm damage, roofer comes out, calls insurance company, he does work, insurance pays him.
Sounds like S.Dakota does it different. Should still be a contract, he did the work, got paid, get lost.
Storm damage, roofer comes out, calls insurance company, he does work, insurance pays him.
Sounds like S.Dakota does it different. Should still be a contract, he did the work, got paid, get lost.
The contractor always asks to see the adjuster report. I will never make that mistake again. What the insurance pays me is my business. The next time this happens, the contractor can assess the damage he sees and bid the job (itemized of course). Lowest bid wins.
It appears you have a replacement cost value insurance policy, which takes into account depreciation or is also expressed as RCV= actual cost value + depreciation.
If the insurance paid the acv first and then paid the depreciation later, that money is all yours. Another way of looking at it is does it cost the contractor anything different if you were replacing a worn out vs a new roof? Of course it doesn't so I don't see how he is legally entitled to any depreciation money.
If you had just an ACV policy you wouldn't be getting that extra $2500 to begin with.
If the insurance paid the acv first and then paid the depreciation later, that money is all yours. Another way of looking at it is does it cost the contractor anything different if you were replacing a worn out vs a new roof? Of course it doesn't so I don't see how he is legally entitled to any depreciation money.
If you had just an ACV policy you wouldn't be getting that extra $2500 to begin with.
Oh goodness, there is a whole lotta bad advice here...
I'll try to cover this is the morning, but in the meantime:
Is the insurance estimate written on Xactimate?
Do you have Ordinance and Law coverage and do any apply (EG drip edge or Ice and Water shield that did not exist prior to the loss)
How did you recover the RCV? (typically a copy of a signed contract or certificate of completion is required)
Did you pay your deductible to the roofer?
I'll try to cover this is the morning, but in the meantime:
Is the insurance estimate written on Xactimate?
Do you have Ordinance and Law coverage and do any apply (EG drip edge or Ice and Water shield that did not exist prior to the loss)
How did you recover the RCV? (typically a copy of a signed contract or certificate of completion is required)
Did you pay your deductible to the roofer?
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First of all there may be jurisdictional or policy language variances but generally:
The homeowner hires the contractor, not the insurance company.
The ACV (AKA depreciated) value is paid up front and the RCV (replacement cost value) is paid once a signed contract is received or other proof the work is completed. The language in the policy/conversation is usually "up to" where RCV is concerned. So if you get it done for less then the lower cost is the RCV and if it cost more then you or the roofer should have contacted the insurance company.
ACV is calculated based on age/condition and there are scales for this that show average life and so forth, for roofing it is usually shingle warranty, so for example if it is a 30 year shingle that is 15 years old the ACV is 50%. so the payment would be for 50% of the estimate less your deductible. Once a signed contract is received up to another 50% is available, but if the contract is for less than 100% the lower cost becomes RCV because the shingles have been replaced for a lower cost. The adjuster should have explained all of this to you in detail, and it should be in your paperwork and policy.
So the short answer is that you owe the roofer the RCV (including your deductible) (for the roofing only portion of course if that is all he did) and any upgrades.
It is quite common for roofers (or roofing salesman) to have you sign something that says they get all the "insurance proceeds". It is also not uncommon for roofers to estimate "based on insurance scope". I'd find it a little surprising for a roofer to do the work without a contract in place and for an insurance company to release RCV without something saying the work was done and at what cost. So go back and look at what you have signed if you signed anything and at all of the paperwork you received including any new estimate that came with your RCV payment. Call the insurance company and see what they received from the roofer if it is still unclear.
Many policies include an option for building ordinance and law. What this covers is upgrades that are required by building code, but did not exist or did not meet code. Drip edge and valley water shield are two common ones as it applied to roofing. Florida even has one about re-nailing decking. Like RCV this is paid when incurred, it has to be required by a code. It should be delineated as a separate coverage on the estimate. It may say "BC" or "OL". This typically would not be on the initial estimate, but on the one that shows RCV released.
Hope this helps.
The homeowner hires the contractor, not the insurance company.
The ACV (AKA depreciated) value is paid up front and the RCV (replacement cost value) is paid once a signed contract is received or other proof the work is completed. The language in the policy/conversation is usually "up to" where RCV is concerned. So if you get it done for less then the lower cost is the RCV and if it cost more then you or the roofer should have contacted the insurance company.
ACV is calculated based on age/condition and there are scales for this that show average life and so forth, for roofing it is usually shingle warranty, so for example if it is a 30 year shingle that is 15 years old the ACV is 50%. so the payment would be for 50% of the estimate less your deductible. Once a signed contract is received up to another 50% is available, but if the contract is for less than 100% the lower cost becomes RCV because the shingles have been replaced for a lower cost. The adjuster should have explained all of this to you in detail, and it should be in your paperwork and policy.
So the short answer is that you owe the roofer the RCV (including your deductible) (for the roofing only portion of course if that is all he did) and any upgrades.
It is quite common for roofers (or roofing salesman) to have you sign something that says they get all the "insurance proceeds". It is also not uncommon for roofers to estimate "based on insurance scope". I'd find it a little surprising for a roofer to do the work without a contract in place and for an insurance company to release RCV without something saying the work was done and at what cost. So go back and look at what you have signed if you signed anything and at all of the paperwork you received including any new estimate that came with your RCV payment. Call the insurance company and see what they received from the roofer if it is still unclear.
Many policies include an option for building ordinance and law. What this covers is upgrades that are required by building code, but did not exist or did not meet code. Drip edge and valley water shield are two common ones as it applied to roofing. Florida even has one about re-nailing decking. Like RCV this is paid when incurred, it has to be required by a code. It should be delineated as a separate coverage on the estimate. It may say "BC" or "OL". This typically would not be on the initial estimate, but on the one that shows RCV released.
Hope this helps.
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OK, here is the update. I think I signed a contract, which I should not have done. The guy was supposed to come out and give me a no cost estimate. Overall, I am happy with his work, other than his lack of communication and not following through with an itemized estimate, which I requested several times. I am able to document that through texts and emails if it were to become necessary. What he billed me for was the Replacement Cost Value for roofing only (which included my deductible), which is fair. He did submit an addendum to the insurance company for about $800. We had agreed verbally that it was up to him to negotiate with the insurance company for any additional funds and if they did not pay, he would assume the cost. Because the repair estimate was below $20k, the insurance company did not require a contract or proof of things done. They sent checks for the ACV and Recoverable Depreciation directly to me, made payable to myself and my mortgage company. The mortgage company also released the checks back to me because the claim was below a certain threshold. The Recoverable Depreciation covered my deductible. I will still be out of pocket for some minor repairs that I can do myself (replace storm door, re-stain decks, etc....).
The work done was good, the roofer made the process a little more difficult than necessary. Next time, I will not show the roofer the insurance adjuster's report. I will get bids from several roofers and whomever comes in lowest gets the job. There was another company in town that does really good work and has a good reputation. I will probably use them next time.
The work done was good, the roofer made the process a little more difficult than necessary. Next time, I will not show the roofer the insurance adjuster's report. I will get bids from several roofers and whomever comes in lowest gets the job. There was another company in town that does really good work and has a good reputation. I will probably use them next time.
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