WHY DO I HAVE TO PAY MY DEDUCTIBLE AND WHAT IS IT?
Each policy has a different deductible amount that the homeowner is
responsible for paying when they file a claim. In line with the Colorado State law, contractors are
not permitted to pay the deductible in behalf of the homeowner.
Here are some important things to note when it comes to your deductible:
• Your deductible will always be a check written to a contractor, not to insurance.
• For example, when you go to the doctor, your co-pay goes to the doctor who
did the service, not your health insurance company. Similarly, your deductible
will go to the contractor that performed the service.
• Your insurance company will release the overall amount of your claim, minus your
• For example, if the overall value of your claim is $20,000 and you have a
$2,000 deductible, your insurance company will give you $18,000.
• Oftentimes at this stage, homeowners feel that they have paid their insurance
carrier because they have received less money. Insurance simply releases the
funds that they owe with the understanding that the balance of the estimate will
be the homeowner’s responsibility.
• When your contractor does all of the work on your claim, they would be owed the full
amount received from insurance, plus your deductible.
• For example, in line with the example above, the contractor would have
performed $20,000 worth of work. Thus your contractor would be owed the
$18,00 received from insurance, plus your $2,000 deductible to meet the total.
At this point, the homeowner has paid the deductible.
WHAT IS “ACV” vs. “RCV”?
Actual Cash Value (ACV): The ACV amount represents the “actual cash value” of the item at the
time of the claim. This means that ACV accounts for any depreciation and is thus a lower value.
• Depreciation: Loss of value due to age, wear and tear, deterioration, etc.
• For example, if your current roof, which has a 20-year life, costs $10,000 to replace but
is 10 years old, the ACV value might be around $5,000. That is the value of the roof,
minus the depreciation.
Replacement Cost Value (RCV): The RCV amount represents the cost of replacing the item at the
time of the claim without the deduction of depreciation. You might hear the term “recoverable
depreciation” here, meaning you can recover the depreciated amount of the line item.
• For example, in the above scenario, your roof costs $10,000 to replace. Therefore, your
RCV amount would be just that.
WHAT IS CONSIDERED AN “IMPACT RESISTANT” ROOF AND ARE THEY HAIL PROOF?
Testing is done on individual roofing materials to determine their survivability against impact and
are thereafter categorized into different classes based on the results. Within this testing, the results
have to come back as “functional damage,” meaning it impedes the ability of the roof to shed
water. An “impact resistant”, or class-4 roof, is the most resistant to damage. Oftentimes, insurance
carriers will provide a discount on premiums if a class-4 roof is installed, but this varies by carrier.
You can talk to your Project Manager about the rating of any particular roofing material.
That said, they are “impact resistant”, not “impact proof.” Class-4 roofs are NOT hail proof. The
majority of roofing materials are tested with steel balls falling from a 20-foot height (UL2218 test).
There is an alternate test (FM4458) in which ice balls of various sizes are shot through a cannon at
the velocity that hail typically impacts a roof. In this test, all asphalt shingles fail FM4458.
Therefore, a class-4 roof might have a higher chance of survivability, but is NOT hail proof and will
experience damage in certain conditions.
WHAT IF I WANT TO UPGRADE?
Your insurance carrier’s policy requires that they bring your home to its pre-storm condition. This
means that the current materials on your home will be replaced with like kind and quality. This
applies to all materials on your home including roofing, siding, windows, gutters, etc.
With that being said, many homeowners find this an opportune time to upgrade to a different or
higher quality material. Your Project Manager is an expert at helping you identify available
upgrades for your project.
Upgrades will require additional funds to be paid on top of the insurance proceeds and your
Project Manager can provide you with a retail estimate for any upgrades desired.