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5 Ways Your Insurance Company Avoids Paying For Your Roof Claim - YouTube
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Working with insurance companies is
enough to drive
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any sane person crazy.
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It seems like with
precious few exceptions do I see that an
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insurance company
has the best interest of their customers
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in mind.
Hi everybody, this is Tracy Bookman owner
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of Homestead Roofing and on today's walk
in the park video
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we're going to talk about the five ways
your
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insurance company avoids paying for your
re-roof claim.
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Now a lot of you know that on our
walk in the park videos, we take time to talk
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about roof repairs, roof replacements, and
the insurance
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claim process, but today we are
in the aftermath of a hail storm
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and so we're in the thick of working
with insurance companies
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and it is just driving me crazy.
So I want to talk about ways that we're
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seeing actively right now,
that insurance companies, especially the
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big ones,
are avoiding paying legitimate claims
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to their customers for their roof
repairs or their roof replacements.
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Tactic number one that your insurance
company uses to avoid paying for your
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roof replacement,
is to raise your deductible. Well what
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does that do? Well that makes
you liable for more of the cost
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of the roof replacement. Well you think,
okay,
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well that's that's legitimate. All right.
If they've told me that they're going to
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raise my deductible,
then I have the opportunity to go look
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for insurance somewhere else
where the deductible isn't as high. Well,
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that's the game that they play though
isn't it? Because they "tell you"
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that they raise the deductible, but the
way that they do that
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is by including that information in the
declaration page that you get
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well, actually, the your policy renewal
document that you get every year.
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And who takes time to read through that
25 or 30 page
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document when it shows up in your email
or shows up in your mailbox? But
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that's where they've informed you
that they've raised your deductible. Okay,
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but let me make a note because you're
probably
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asking yourself, well that doesn't avoid
paying for my roof replacement,
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you're right. But it's putting more of
the the share of the cost
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on you as the homeowner to pay for it,
and so if your deductible goes from
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a thousand dollars to fifteen hundred
dollars,
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the insurance company just saved
themselves five hundred dollars off of
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that particular job.
Multiply that by thousands and thousands
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and thousands of claims that they get.
And a lot of times your a homeowner's
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deductible isn't going
only from a thousand dollars to five
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hundred dollars,
sometimes it's going from a thousand
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dollars to
two thousand dollars, twenty five hundred
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dollars, six thousand dollars,
I mean we've seen ridiculous deductibles
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recently, as high as twelve thousand dollars. Tactic number two, that the
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insurance companies use
to get out of paying for your roof
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replacement
is, they'll just simply deny the claim.
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Why do they do that? Why do they think
they can get away with that? Because they
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can get away with it.
What happens is, you know, maybe a
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homeowner calls an insurance company and
asks for an adjuster
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to come out, and if there's a lot of
claims
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in the area, or if that company is
suffering from a lot of claims because
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of
catastrophes in other areas, they might
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simply just deny
your claim, because they know that the
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majority the vast majority of homeowners
are just going to accept
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whatever the adjuster says, and if the
adjuster says well there's no damage or
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there's not enough damage up there to
warrant a claim
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the homeowner is going to believe him,
because the homeowner trusts
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the insurance company and and the, the
representatives of the insurance company
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and I'm telling you that's not always
the best idea.
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Sometimes that's an okay idea, sometimes
that's an okay thing to do
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but not always. We've had plenty of
experience
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with insurance companies that have
denied claims that have had valid damage,
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sometimes with with hail hits as big as
this
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with holes going all the way through the
shingle, and the insurance company denies
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it. Tactic number three that your insurance
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company uses to avoid paying for your
roof replacement
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is, to just simply fight with your
contractor.
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So maybe your contractor has sent in an
estimate, maybe your contractor has
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finished the job and has sent in
an invoice asking for payment for a
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total dollar amount,
and the insurance company will fight
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with the contractor about this line item,
or that line item, or the price on this
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particular line item,
or say we don't pay for that particular
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item to be installed, or to be
replaced or whatever,
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on and on and on it goes, all these just
little
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itty-bitty battles that your roofing
contractor has to go through
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with your insurance company to get paid
what it is that he needs to make
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to be profitable on that job and to
sustain his business.
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But your insurance company knows that
they have far more resources,
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both in personnel and in capital
to be able to fight that battle on an
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ongoing basis, whereas, most contractors
don't
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so they just try to wear the contractor
down. Whether it's a roofing contractor,
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or a general contractor,
or a siding contractor, it doesn't matter,
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they do the same thing
with any contractor. They try to wear the
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contractor down, because they know
eventually
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the contractor needs to keep his cash
flow going, so the contractor will just
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simply
give up and accept whatever it is that
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they're offering to
to pay. Tactic number four that your
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insurance company uses to avoid paying
for your roof replacement
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is, that they prorate your replacement
coverage.
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Well, what does that mean? Well, most
people have what's called replacement
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cost value coverage on their insurance
company, and they
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expect that their insurance company is
going to
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indemnify them for a hundred percent of
the cost
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of replacing their roof or replacing
whatever property it is that's damaged.
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And historically that's been what has
happened,
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is that the insurance company is, is
paying the homeowner 100%
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to replace the damaged property. But what
some insurance companies have started to
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do,
and a lot of them are starting to follow
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suit, pro-rate
that replacement coverage. So that means
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that it,
it's no longer 100 percent
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indemnification, 100 percent replacement
cost.
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So one proration schedule that I just
recently saw from one of the major
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carriers here in town,
shows that, that you have a hundred
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percent
coverage for the first year, and that's
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the first year after
you have a new roof installed, but then
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after that first year,
in year two it goes down to 97 percent.
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The next year it goes down, it goes down
even more.
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Until like after 10 years, if you've got
a roof that's 10 years old,
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if you file a claim, then you're only
going to get 70 percent
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of the value of that roof. So here's
the implication to you as the homeowner.
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Let's say, just like has happened here in the
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Colorado Springs area, we get
two major storms in a two-year period,
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let's, let's say it's five years, and you're
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with a company
that prorates your coverage. And so let's
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say by that
fifth year ,you're down to, I don't know,
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ninety percent coverage. What that means
is that
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they're going to depreciate the value of
the roof
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and you're going to only get instead of
a hundred percent
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of replacement cost, so that you know
five years from now whatever it costs to
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replace a roof you would get a hundred
percent of that amount,
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now you're only going to get 90%, or 95%,
or 80%, whatever amount it is so
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that 10% amount, hypothetically,
that 10% amount comes out of your pocket,
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in addition, to your deductible.
Again, they're not avoiding
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completely paying for your roof, but
they're keeping back a significant chunk
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of change,
for themselves, making - putting that cost
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on you,
and then when you spread that out over
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thousands, or
sometimes even maybe even millions of
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claims,
that really adds up to a lot of dinero
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for the insurance company.
So here's tactic number five that your
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insurance company will use
to avoid paying for your roof
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replacement, and it's called
cosmetic exclusions. Now,
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there has been one insurance company, one
of the major carriers,
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that for the last few years, that's been
a big deal for them,
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is that they're excluding things that
are cosmetically damaged not
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functionally damaged. Typically it's only
going to be the soft metals, so
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vents, vent caps, gutters,
that kind of stuff. So if, if it isn't
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functionally damaged, meaning that it
still works the way that it's designed
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to work,
but it just has some dents in it, they're
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not going to pay for that. But now
insurance companies are moving beyond
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excluding just simply
accessories like gutters, or vents, or
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things like that, and now they're moving
it to a whole roof.
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What we're finding now, is there's one of
the major carriers here in this area
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that has changed their policy, so if
in the past, you have had an
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impact resistant roof material installed,
so you could get the discount from that
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insurance company that they offered, now,
you are subject to their cosmetic
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exclusion clause,
which means that if they come out, and
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they - if you file a claim, the adjuster
comes out, and he determines
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that the, the roofing material is not
functionally damaged, meaning the hail
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hasn't
penetrated it, if it's a shingle it
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hasn't broken the mat,
if it's metal, it hasn't caused an actual
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break in it, it's probably all bent
bent up if it's metal, if it's a shingle
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it's probably full of pock holes and
stuff like that,
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but if it's not functionally damaged,
it's
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cosmetic damage, and they're going to
deny the whole claim. Now I heard about
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this,
just, what, a couple days ago, from an
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adjuster for that company,
and he was complaining about it because
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he was writing up
total losses for homeowners to get their
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roofs replaced,
and the company that he works for, was
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denying the claim.
Boom. Boom. Well, that's incredibly
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maddening. Sure it's maddening for us as
roofers, because
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we rely on that work for
our income, but for me it's actually more
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maddening from the,
for the homeowner, because the homeowner
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oftentimes doesn't know that's going to
happen to him.
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So maybe he paid to upgrade his roof to
an impact-resistant material or
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something like that,
and now it's gotten damaged, because you
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know golf ball size, tennis ball size,
baseball size hail is going to damage
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any roof material that you put on there
pretty much,
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and so, maybe he paid some to upgrade his
roof,
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and now he's getting the unpleasant
surprise of having a roof that's totaled,
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and a roof that looks horrible,
and he's gonna have to pay to replace
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that himself .because the insurance
company says,
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nada. All right, so two if's, if
you're an insurance agent watching this
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video,
and if you've stuck with me all the way
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to this,
this far, please, let me
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make an appeal to you, as an insurance
agent,
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please. If the policy that you're writing
for your customer,
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has these exclusions, has this kind of
stuff
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in it, let the customer know.
So that way, they don't get a complete
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shock,
that they're going to have to pay out of
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pocket to replace their roof,
when it's legitimately damaged.
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So, I know this is kind of a hot topic,
it's hot topic for me,
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it's a hot topic for adjusters as well,
so if you've got any questions about
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this, please, give us a call at our phone
number
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right up here 719-433-6991
you can also visit our website, that's
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right down here,
HomesteadRoofingColorado.com we've got a
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ton of information out there,
lots of other videos that will educate
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you on this whole process.
If this video has been helpful for you,
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we'd love it if you give us
the big thumbs up, leave a comment in the
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comment section down below.
Let us know, hey what questions do you
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have, that you'd like us to answer, what
situations have you encountered with
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insurance claims,
that you'd like us to address. Also,
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please subscribe to our channel,
and be sure to click the bell icon up
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there so that way you get notified when
we've got new videos.
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And until our next walk in the park
video, I'm Tracy Bookman,
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owner of Homestead Roofing.
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