Our Glossary of Terms

This is the person who comes to inspect the property, define the scope of damage, and determine if your roof is covered under the insurance policy. The adjuster either is employed by your insurance company or by an independent company. They will spend about one or two hours inspecting your property damage and will take lots of photos. Remember to tell them about any potential issues they might not be aware of, such as stains on the ceiling, musty smells, or mold growth. It does not cost anything out of pocket to request an inspection or to file a claim with your carrier.

Important: Before filing a claim with your insurance company, its always best to have a licensed inspector check your roof to determine the extent of the damage. If your damage is minor, you might choose to pay out of pocket instead of filing an insurance claim.

The final step in closing a claim and having the recoverable depreciation funds released is the signing of the Certificate of Completion or an Insurance Completion Form. The contractor completes this form based on the insurance company requirements, which can vary. The homeowner only needs to sign the document showing that the work has been completed. Before you sign, you should feel confident that the job has been completed, the project has been replaced or repaired according to the scope of work, cleanup has been completed, etc. If this document is not signed and sent to the insurance in a timely manner, the final funds may not be released and then the homeowner becomes responsible for any remaining costs. We don’t want that, now do we?

A change order is a written amendment to an existing contract after the effective date that alters the work or the contract sum. While contracts are intended to be the final word for projects, sometimes issues arise that require additions or deductions from the original contract. A change order is created and signed by both the contractor and the insured. It is an extension of the contract and legally protects both parties.

A policyholder’s request for reimbursement from an insurance company under a home insurance policy for a loss to property.

Once the contractor receives the Scope of Work, they will write up a Contract or Work Order Agreement and request your signature. This document serves as authorization for the contractor to proceed with the work outlined in the Scope of Work. The Work Order will detail the specific components to be replaced, including quantity and color, as well as any agreed-upon upgrades, additional add-on items, Lifetime Warranties, and any cancellation clauses or fees.

Deductibles are a required out-of-pocket expense on the Insured’s part even though it is factored into the Replacement Cost Value of your project. In no way is a contractor legally allowed to waive or discount an insurance deductible. Typically, your out-of-pocket expenses will not exceed your insurance deductible unless you opt for product upgrades, Lifetime Warranties, or other additional items as agreed upon.

It’s important for homeowners to understand depreciation, both recoverable and non-recoverable, which refers to the decrease in the value of the roof due to wear and age before repairs are made.

Non-recoverable depreciation is when your property loses value, you won’t be able to get that value back through insurance if it gets damaged. They’ll only pay you what your roof (or other property) was worth when damage happened (aka the item’s loss in value over time is nonrecoverable). Therefore, any remaining non-recoverable depreciation costs are the responsibility of the insured to pay along with their deductible.

Recoverable depreciation means your insurance carrier will pay you enough to replace the loss—which means the depreciation is recovered. You’ll get a check that equals what your damaged property was worth and then a second check to cover what it costs to get a new one. These funds are disbursed upon completion of all repairs and submission of required paperwork to the insurance company.

For instance, if you have a Replacement Cost Value (RCV) policy with recoverable depreciation, a $15,000 roofing claim with a $1,000 deductible and the insurance company determines a $5,000 depreciation, you’ll receive a $9,000 check ($15,000 minus deductible and depreciation). Once all roofing work is finished and paperwork submitted, the insurance company will mail a $5,000 final depreciation check to the homeowner. If the contractor doesn’t submit all the required documents accurately, the insurance company will withhold depreciation funds.

If you have an Actual Cash Value (ACV) policy that includes non-recoverable depreciation, the insurance will only send the initial ACV funds via check and you will be responsible for the $1,000 deductible plus the $5,000 non-recoverable depreciation.

It’s essential to note that choosing not to complete repairs and just keep the initial insurance check, will forfeit the final depreciation check. More importantly, it’s absolutely imperative to understand that if you do not complete all approved repairs and have your contractor submit all the final paperwork to your insurance company, your roof no longer is insurable. That means that if you have damage in the future, your insurance company will not pay for it because you did not take all the final steps to repair the damage and return it to good condition, underscoring the importance of completing all necessary steps to restore the roof.

Dwelling Coverage, sometimes referred to as “Coverage A”, protects against the damage and possible loss of your home in the event of a covered claim such as a hurricane, hailstorm, lightening strike or fire.

Overhead costs are general operating expenses for necessary equipment and facilities. Profit is what allows the general contractor to earn their living. While two separate costs, insurance companies will add them together under the label “O & P”

This is a line-by-line breakdown of every item slated for repair or replacement by the insurance company. The Scope of Work outlines specifics for each item, including required quantity and associated costs. This report is sometimes provided to the Insured at the time of the inspection, but can also take a few days to obtain from the adjuster in many circumstances. Upon receiving the Scope of Work, it’s essential to furnish a copy to your  contractor. As per regulations, the contractor is only authorized to carry out the work outlined in this report. Any work not being done by the contractor, will be documented, and reported to the insurance company for transparency.

Once a claim is filed and the Scope of Work is provided by your adjuster, it’s common for your contractor to discover additional damages not initially identified or included by the adjuster. These may include missing materials or necessary labor charges not accounted for in the original scope of work. In such cases, the contractor can submit a supplement request to request additional funds to cover these damages on behalf of the homeowner.

This process is a standard practice in the industry and occurs in approximately 75% of roofing claims. Issues such as water damage and compromised roof decking (sheathing) can be challenging to detect until tear-off, often leading to the need for supplemental requests. If/when payment is made by the insurance company those funds are due immediately to the contractor, in full, as these funds are specifically for the extra materials/labor needed for planning your project.

Important: Its important to note that certain materials, such as OSB roof decking (sheathing), may not be covered by your insurance due to quantity or cost. However, each project is unique and specific circumstances will be discussed in depth at the time.