Storm Contracting ensures you are getting the most for your money and knowing the truth about estimates is the best way to do business as an informed buyer.

Storm Contracting wants to help you better understand the estimate process.

When someone is looking for a contractor to complete a home improvement project such as bathroom remodeling, painting, or roofing, the first step is usually to get estimates. An estimate can range anywhere from cousin Joe saying something like “I could do that for five hundred bucks!” to a professional, spending a considerable amount of time measuring and calculating costs in order to provide you with a competitive yet profitable “bid.” 

In the retail remodeling and building business this is standard practice, and when we do retail work we provide estimates. This is to ensure you are getting the most for your money and is the proper way to do business.

The situation is different with insurance claims. I hope the following information will explain why getting estimates for an insurance claim is NOT in your best interest, and is a waste of your time and potentially, money! 


     –When the adjuster comes to see your property they will inspect all the damages that they can see and they will write up their estimate for the replacement of all damaged items to your property.

-The adjuster will separate the claim into separate segments. The total claim is called the Replacement Cost Value (RCV). The second part is called Depreciation, third is deductible and the final is Actual Cash Value (ACV).

The formula is RCV-Depreciation-Deductible=Actual Cash Value. For instance: $10,000-$4,000-$1,000=$5,000

– So your first payment will be $5,000. Upon completing all the work and PAYING $10,000 to your contractor the insurance company will send you a final payment (depreciation) in the amount of $4,000. Therefore you, the customer paid $1,000 out of pocket.

-Occasionally an insurance company will ask you to get more estimates. This is in hopes that one of the estimates will be lower than their pricing, thus saving the insurance company money. here’s how that works…

– You get thew $10,000 RCV claim from your insurance company and someone knocks on your door and says “don’t worry about your deductible, we can roof your house for what the insurance gives you.” Now for most people that sounds great but here’s the truth!!!

*** Your insurance company sent you $5,000 remember… If the contractor says he can do it for $9,000 they MUST LEGALLY send an invoice to your insurance company for $9,000. Your carrier will be delighted because now the claim looks like this…. $9,000-$5,000-$1,000=$3,000. You will effectively receive $8,000 so you still owe the contractor $1,000. You didn’t;t save a penny.

*** Now what really happens is that contractor invoices for the FULL RCV of $10,000 and collects $9,000 from you and they walk away happy. However what they did was commit insurance fraud by sending in a fake invoice. The position they have put you in you didn’t deserve but it’s you that will have to send your carrier the difference to make them whole again. 

-So then to be clear, if you did take your time to meet with multiple contractors, explain everything 3 or more times, have 3 inspections, and listen to 3 sales pitches, ultimately the only estimate that really even matters is the insurance adjusters. The insurance company uses Xactimate software to set the price they will pay, and other than any real mistakes he may have made, or items he missed, that is what they are willing to pay (unless you can help find them someone cheaper to do it)! 

-Generally if someone is considerably cheaper on their estimate, they are not qualified to handle your project. So as you can see, there is no need for you to get estimates. Choose a qualified contractor who is licensed, insured, has references, and carries a comprehensive warranty. But most importantly, you need to find a roofing company that is qualified and experienced in handling insurance claims and dealing with insurance adjusters. I hope this was informative, and we look forward to handling YOUR claim from start to finish saving you time, money, and headaches! Click HERE to learn our process.