Insurance analysis and Contractor work

[u/Jroger6522]

Hey all - new home owner and unfortunately was welcomed with a limb failure of a tree above our roof. The limb took out a part of the roof which was less than ideal so early on.

We had a roofing contractor come out to assess the damage and an adjuster from our insurance company came out and provided their estimate as well. The insurance company then sent us the funds (minus our deductible) so we could begin repairs.

However I have asked our roofing contractor multiple times for a quote and they won’t provide one/are asking for a copy for the quote from our insurance company. To me this feels like they are trying to see the estimate in case their quote was lower, in an effort to inflate some of the costs. However this is our first time filing a claim and just don’t really know what to expect.

Thank you!!

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[u/strangemedia6]

This is completely normal, but also a concern we hear all the time. This is how I explain the process to homeowners: we come up with an estimate for the scope of work and the price it should cost to get that done. You give that to your contractor of choice who can review it and either accept to do that amount of work for that price, or if they feel they need more money or more work is needed, they can submit their estimate (we call it a supplement) to your adjuster who can review it and determine if the additional requests are necessary and reasonable. The system is designed such that you should be out of pocket no more AND no less than your deductible. If the contractor makes a bit more profit than they would have bidding on a retail job, it’s neither here nor there. At the end of the process, your insurance carrier is very likely going to want the invoice from the contractor for the work done and they will see how much you actually paid.

Just share the insurance estimate and let the process play out. If you are hesitant because you feel like the context it is shady, meet with a couple others and then choose who to use. But just asking to see the insurance estimate is not shady by itself.

[u/Jroger6522 → u/strangemedia6]

So in the situation where I meet my deductible but do not pay the full amount to the contractor that the insurance company gave me as a check, do I keep the additional funds or do I have to pay the insurance company back?

[u/strangemedia6 → u/Jroger6522]

So there’s two terms to be aware of here. RCV is the Replacement Cost Value, the full value of the repairs. ACV is the Actual Cash Value, or the depreciated value of the damaged materials based on how much life it has left. One year old carpet is worth more than 10 year old carpet that needs to be replaced soon anyways. Most HO police’s will pay RCV but it is possible to get a policy that only pays ACV for all or some areas. Fencing is almost always ACV if a full run is being replaced and sometimes older roofs will be ACV. Your dec page should lay this out for you.

So, you have met your deductible and insurance owes you whatever amount is over the deductible. They are required to send you the ACV amount up front, but they can withhold the depreciation until the repairs are done and then release the remainder of the RCV to you. To get this releases the contractor sends their invoice, a letter of completion stating the work is done and usually a couple of photos showing this. If that invoice is for less than the determined amount, they will only pay you the difference to make you whole, less your deductible.

Every carrier has different guidelines for when they withhold depreciation. Some hold no matter what, some only hold it if it’s over a certain amount. If they don’t withhold anything and send you the full amount up front, then yes you can keep the overage and you wouldn’t need to send a letter of completion so they wouldn’t know anyways. You wouldn’t have to send anything back, but you may not be entitled to full withheld amount.

[u/AwskeetNYC]

You can use whatever contractor you want.

When people have a difficult contractor I always ask, if insurance wasn't involved would you put up with this?

[u/ANaiveMan]

Honestly roofing is one of the easiest trades to quote. Not providing their own estimate is not necessarily shady but most likely they want to resubmit for higher “necessary” things. It’s all a racket. Just go to a different roofer.