Ifyour home has been damaged in a storm, filing an insurance claim can be a complicated process. At 123 Exteriors, we have a team dedicated to helping homeowners understand the process and terms and navigate the complicated paperwork. Our new online Homeowner's Resource Center was developed to assist homeowners who are navigating the insurance restoration claim process.
In honor of the launch the Homeowner’s Research Center, we have put together a list of the most frequently asked questions we receive from homeowners.
Q.) What happens if the insurance company denies my claim?
A.) You do not have to agree with the adjustor’s findings. Every adjustor has a differentOur interpretation of what storm damage is. If you or your contractor do not agree with the results of their inspection, you can request a different adjustor be assigned to the claim. This is not filing a new claim; it’s simply asking that another adjustor take a look at your property.
The second inspection is a courtesy offered by the insurance carrier. If you do not agree with the second adjustor, you can request that the insurance carrier send an engineer to review the damages.
Insurance companies do not make money by writing checks, so often times they will instruct their adjustors to tighten up on payouts. It is always best to have an experienced contractor meet with the adjustor. Do not allow yourself to be taken advantage of by your insurance company: remember YOU pay THEM.
Q.) What are supplements?
A.) Often times supplements are missing items that need to be included in the adjusters scope of loss in order to perform the work properly. These items that are added after the original scope of loss are written in by the adjuster, and are referred to as supplements.
Supplements can beimportant elements on the siding or roof project, such as removing and replacing vents and flashings. Another common supplement would be items required to bring your roof and or siding up to local code. Bringing your roof and/or siding up to local code is very important, and your insurance company more than likely owes to get it that way. If you were to ever sell your home, your home inspection would require you to bring your home to code before the sale. You don't want to have to pay for this out of pocket! Additionally, most code items required have to do with ventilating your attic and insulating your exteriors walls, this can have a big impact on your heating and cooling bills.
Your adjusters scope of loss is what the insurance company comes up with as a "list" of items needed to get your home back to where it was before the storm. This scope of loss determines how much you are paid to make the repairs.
Q.) Can my insurance company raise my rates or cancel me if I make a claim?
A.) It is very unlikely your insurance carrier will raise your rate or drop you for a weather-related claim to your home. Hail and wind are acts of nature and there is nothing that can be done to protect your home from these events.
If you file 3 or more claims within a year you are at risk of being dropped because the insurance companies will begin to see tyou as a high-risk insured.
In addition, although it is unlikely and (in some cases) considered unlawful for the insurance carrier to raise a customers rates due to an act of nature, if there are enough claims filed in the area, everyone will see a slight increase to their homeowner premiums. Customers who do not file a claim, will experience the same increase if they are in the area.
It is in the insurance companies best interest to repair the damages as they may lead to bigger problems such as leaking that resulting in bigger payouts.
Q.) I'm confused with the different types of deductibles (i.e. % of ACV/RCV, % insured value, increased wind and hail deductibles). Can you explain these?
A.) ACV and RCV are types of policies. ACV stands for Actual Cash Value. That is the amount the insurance company deems your damaged property is worth in it’s used, damaged state. It’s your property, it’s damaged, they owe you for it.
RCV is Replacement Cost Value: what it costs to replace that item. With a Replacement Cost, policy carriers will award the insured the ACV amount up front as a gain, because it’s their property, it’s damaged and they are owed. It’s perfectly within the homeowner’s legal rights to keep those funds and do as they see fit. However, if they do not replace the item, they cannot recover the depreciation which is (the difference between ACV and the RCV that the insurance companies hold until the replacement is complete) and that item cannot be claimed again until the replacement is made.
In a Replacement Cost policy, the homeowner is allowed to recover the depreciation after the replacement is made. In an ACV policy, the homeowner will not be allowed to recover the Depreciation after the replacement is complete. They are only awarded the ACV amount.
When obtaining insurance it has become common practice for the insurance company to inspect the property before writing the policy. If the inspections results prove there is no storm damage to the home or the homes roof and/or siding is already in poor shape then they will not write a replacement home policy on those items until those items are repaired or replaced.
If you are thinking about not having your home inspected by a contractor after a storm, remember, if you go to sell the home, it’s likely the buyer’s home inspector will identify that damage and if you are going to switch insurance companies or make any changes to your policy, the carrier is also likely to identify this damage and will not allow replacement cost coverage.
Deductibles vary by how costly you want your premiums to be to how often your region is affected by severe weather. If a customer chooses to have the least expensive deductible, their monthly premiums are usually inflated. If the customer chooses a higher deductible, their premiums are usually cheaper. In regions where severe weather is regular, insurance companies usually offer a % deductible. It is 1% or 2% of the amount the home is insured for. These deductibles tend to be a little higher to discourage insureds from filing claims. Hail/wind often carry separate deductibles from other insurance such as fire and water.
Q.) What is non-recoverable depreciation?
A.) RCV- The adjuster determines the Replacement Cost Value of items that were damaged by the storm. This figure is the amount that they deem reasonable to either repair or replace the items that were damaged.
From this RCV the adjuster calculates what amount should be "depreciated" based on the age of the item and how much that item has been used.
This depreciation is divided into 2 types- Recoverable and Non-Recoverable (or NRD).
Recoverable depreciation is the maximum amount that the adjuster will pay after the work is completed. Non-recoverable depreciation is not recoverable at any time. Often non-recoverable depreciation is noted on an adjusters scope by using < > symbols. Please note those amounts are amounts being deducted from the claim.
Q.) Why is the first insurance check depreciated?
A.) The adjuster will take the RCV- replacement cost value and subtract the depreciation to come up with the ACV- actual cash value. Usually this is the amount that the adjuster will pay you as an initial payment less than any deductible that you have.
The depreciation is only paid after you get the work completed, and acts as a safeguard to make sure the repairs are actually made with the money provided by the insurance company.
If you have a question that is not covered here, leave it in our comments section below and a trained specialist will address it!
123 Exteriors has spent a decade providing superior roofing, siding, gutters and window replacement services to our customers in St. Louis, Chicagoland, Milwaukee, Columbus, Cedar Rapids and Davenport.