What Homeowners Need to Know
In recent years, insurance carriers have been tightening their roof guidelines, making it more challenging for homeowners to get coverage for roof-related claims. This shift is driven by a combination of factors, including increased storm damage, rising repair costs, and fraudulent claims.
Why the Change?
The primary reason for the tightening of roof guidelines is the surge in roof-related claims. Severe weather events, such as hailstorms and tornadoes, have become more frequent and widespread, leading to a significant increase in claims1. In 2023, damage from storms doubled from $30 billion in 2022 to $60 billion. This surge in claims has driven up costs, with the average claim increasing by $2,000.
Additionally, fraudulent claims by “storm chasers” have contributed to rising premiums. These scammers often go door-to-door, convincing homeowners to file inflated or fake claims. To combat this, insurers are implementing stricter guidelines and using advanced technology like drones and AI to detect fraud.
New Roof Guidelines
Insurance carriers are now enforcing very specific underwriting guidelines on roof acceptability. Roof age and coverage requirements are now an integral part of client and agent conversations.
- Homeowners can no longer estimate or guess a roof’s age when applying for or renewing home property insurance.
- Many Carriers no longer cover full roof replacement costs for older roofs (10-15 years).
- Now, they cover the depreciated value or impose higher deductibles.
- Some carriers are even limiting loss settlement for windstorm or hail losses for roofs older than 10 or 15 years.
- For roofs older than 20 years, coverage may be limited to removal if the roof meets the dwelling maintenance requirements.
Actual Cash Value (ACV) Payout Timeline
When it comes to payouts, insurance carriers typically pay out the Actual Cash Value (ACV) of the damaged property. The ACV is the property’s market value at the time of the incident, factoring in depreciation. The timeline for receiving an ACV payout can vary, but most insurers aim to make a settlement offer within 15 to 30 days after receiving all necessary documentation.
However, policyholders should be aware that delays can occur due to factors such as incomplete documentation, legal requirements, and potential disputes over the valuation. It is crucial to report the loss promptly and provide all required documentation to avoid unnecessary delays.
What Homeowners Can Do
Homeowners in storm-prone areas should consider fortifying their roofs to reduce risks and lower premiums. Some states offer incentives like premium discounts for compliance with stricter building codes. Additionally, homeowners should review their insurance policies regularly and discuss any changes with their insurance agents to ensure they have adequate coverage.
Contact Connie Phillips Insurance
Phone: 888-439-0479 or Website https://www.insurance-financial.net/personal-insurance/ so we can discuss your Homeowners policy needs and make sure you have adequate coverage. You do not want to be caught off guard when the Roof claim is not paid out! Talk to your agent now and know your coverage.