INSURANCE CLAIM BREAKDOWN
Learn about the steps and terms used in an insurance claim.
With the various types of insurance claim payouts, it is necessary to provide further clarification for each specific situation. As the insured, it’s important for you to have clear expectations and an understanding of the various elements regarding the claim process.
POLICY REVIEW (ACV vs. RCV)
Our team reviews your insurance policy to determine if it is Actual Cost Value (ACV) or Replacement Cash Value (RCV).
This information is necessary for us to calculate your total out-of-pocket expenses.
This is the amount of the replacement cost value less the depreciation amount regardless of whether or not the depreciation is “recoverable.”
Actual cash value applies to every claim.
This is the amount a property is depreciable that concerns this value.
For Example: Should a roof that’s less than a couple years old be damaged by a storm event, there could potentially be no depreciation on the total cost of the roof replacement, and the net ACV portion would simply be the RCV amount less the deductible. However, a roof that is aged 15 years which is covered by an RCV policy will most likely be depreciated more heavily which will directly affect the payment structure applied to the claim.
The ACV amount will be paid by the carrier; therefore, it is just the depreciation and it being recoverable, that determines the overall carrier payouts and timelines of said payouts.
ACTUAL CASH VALUE (ACV)
NON-RECOVERABLE DEPRECIATION
An “Actual Cash Value” (ACV) policy will only pay for the depreciated value of your property and not the entire cost to restore a property to its pre-storm condition.
You will need to pay your deductible, plus the difference between the replacement cost and the depreciation.
Depreciation factors can vary from one insurance carrier to another, but often correlates to the age and condition of the component of the property that is being evaluated.
The more the a section of your property has depreciated due to its age (such as a roof), the less the insurance will pay towards restoring that property to pre-storm condition.
This can lead to a higher-than-expected burden on the insured in order to complete the necessary roof repair or replacement.
Review of your policy prior to filing a claim will provide a great deal of clarity regarding cost expectations.
ROOF PAYMENT STRUCTURE (ALLSTATE)
Can be found with Allstate policies
Even though your overall policy might be replacement cost value, your roof section is covered as actual cash value only, and the depreciation on the roof is non-recoverable.
This type of coverage will increase your financial burden for any claim related to the roof.
Review of your Allstate policy prior to filing a claim will provide a great deal of clarity regarding cost expectations.
The amount it would cost to replace your roof without deducting its depreciation.
Consider this the complete cost of all the labor & materials necessary to restore your property to its pre-storm condition as approved by the claim.
Will be listed on the separately on the estimate.
REPLACEMENT COST VALUE (RCV)
RECOVERABLE DEPRECIATION
A “Replacement Cost Value” (RCV) policy will not depreciate your property.
This is another way of saying that the insurance company will pay for the full amount of the costs (less the deductible) needed to restore the property to its pre-storm condition with regards to all of the aspects that insurance has deemed to be related to a specific instance.
This is the amount that the insurance company will not include on the initial payout of the claim.
The insurance company will pay this portion once confirmation of the work associated with the scope of loss has been provided to the insurance company.
The nuances of this are an excellent reason you should partner with a reputable company with extensive experience in the insurance claim process like Riegler Contracting.
DEDUCTIBLE
The amount of the deductible will be clearly identified in your policy and on the insurance estimate.
Your insurance company requires you to pay this amount “out-of-pocket”, and is your portion of the total claim payout to Riegler Contracting.
Similar to a “co-pay” as with medical insurance.
Review of your policy prior to filing a claim will provide a great deal of clarity regarding cost expectations.
This document provided by the carrier serves as a starting point for labor and materials needed to restore your property.
Should the initial estimate provided by the carrier not be sufficient in paying for all the necessary costs related to the needed repairs/replacement, there are methods to restore communication with the carrier via photos and documentation in building a case for the additional funds. It’s important not to concede and accept a less than satisfactory outcome on the claim that you have filed.
Riegler contracting is more than pleased to assist you with the scope of your claim at no cost to you.
SCOPE OF LOSS / INSURANCE ESTIMATE
SERVICE AGREEMENT
This document is crucial in the process as Riegler Contracting will commit its resources on your behalf, at no cost after signed by you, to work towards your desired outcome in filing a claim.
Upon signing of the agreement, Riegler Contracting will:
Inspect and identify all storm related damage to your property
Be present on your behalf (or with you) at the scheduled insurance field adjuster meeting,
Should the claim be initially denied, RC will submit documents and photos of the storm damage and set up a reinspection on the basis of the overlooked findings
Supplement the initial estimate to ensure that all work that needs to be completed will be paid for by the claim
Provide all of the above services at no cost under the provision that Riegler Contracting be the contractor
Keep in mind that while your agent may be someone whom you know, a field adjuster (and possibly a 3rd party adjuster whom is subcontracted by your insurance company) could very well be someone that has no direct interest in a positive outcome on the claim that you submitted.
Riegler contracting is able and ready to provide that support to you on a level that is unparalleled in the industry.
PWI / PWARR (CODE UPGRADES)
There are line items on an insurance scope of loss (estimate) for which the carrier will not provide any value on the claim until after the physical work has been confirmed by Riegler Contracting.
These items could include, but are not limited to, ice/water barrier installed at eaves and in valleys, edge metal installed at the entire roof perimeter, etc.
These could be aspects of roof installation as deemed necessary by a local jurisdiction for which a policy must also include code coverage.
The carrier will sometimes acknowledge (and other times Riegler Contracting will bring these items to their attention) that these items should be paid for, but they won’t pay out at all on those items unless they are actually performed.
Riegler Contracting installs every product to the highest standard which is well beyond the state and local codes and will submit those additional costs to the insurance carrier as their responsibility.
SUPPLEMENTS
Insurance companies use 3rd party software applications to compile their estimates as related to a claim, but that estimate is almost never the complete scope of work (which is why it is referred to as an estimate).
Riegler Contracting is trained and certified in the use of these estimating programs with extensive experience in not only compiling an accurate scope of work, but also communicating proficiently with insurance companies when elements of their estimate are deemed to be inadequate.
This is not driven by preference or subjective information but validated by documentation and proof of concept.
The following are a few of the aspects of the estimating software which require supplementation:
Price list updates as implemented by these 3rd party estimating programs can force an estimate to be revised
Missing line items on the insurance estimate for a specific project
Inaccurate quantities per unit on an insurance scope
Refusal by insurance carrier to approve certain items until the contractor can provide documentation proving that specific items need to be included
Code coverage items that the carrier will not included until deemed necessary
The supplement process was established by insurance carriers as a means for those who are actually performing the work to submit the additional costs associated with the completion of that work as needed.
Riegler Contracting subjects itself to insurance pricing which means that RC does not impose upon the insured any of the discrepancies beyond the revised insurance scope that the carrier is refusing to include.
Generally, but not always, only wood replacement not covered by the insurance company will be expected to be paid by the insured regardless of the carrier’s determination (nonetheless, we submit all the validating documents and photos in conjunction with repeated follow ups, for an extended period of time if necessary, on behalf of the insured).
CERTIFICATE OF COMPLETION
This document will be generated and submitted by Riegler Contracting to your carrier as a means of verification that the repairs/replacement as outlined on the carrier’s scope of loss has been completed.
This document is critical in triggering the release of any funds associated with depreciation and supplements.
It also becomes a document on record that the claim was fulfilled and you, the insured, are in fact “in good standing” with the carrier should any further claim needs arise.
Carrier payouts toward a claim are nearly always routed via the insured who must then transfer those same funds to Riegler Contracting.
If a property is under mortgage, the lending company will most likely also be named on the insurance payout.
Some carriers remit payment via mailed check while others might provide direct deposit into your bank.
Riegler contracting will work with you regarding any payment scenario by accepting transferred check payments and/or accepting online bank transfer of the claim funds.
INSURANCE CARRIER PAYMENTS
TYPICAL CLAIM PAYOUT STRUCTURE
Deductible is not included in any payout by the carrier and must be paid directly from the insured to Riegler Contracting.
Net claim/net estimate payment is variation of the term, but equals in value, the net actual cash value payment. This amount is the RCV less deductible less any form of depreciation less any code upgrades (PWI/PWARR). This amount should be paid by the carrier upon approval of the claim and not dependent on any work having been performed at this juncture.
Recoverable depreciation will be released by the insurance company upon receipt of confirmation that the repairs/replacement, as described on the scope of loss, have been completed. This payment is prompted by submission of documents from Riegler Contracting directly to the carrier who will then remit payment to the insured for transfer to Riegler Contracting.
Non-recoverable depreciation will not be included in any payment from the insurance carrier. This amount will be the sole responsibility of the insured to be paid directly to Riegler Contracting, separate from the deductible which must also be paid directly to Riegler Contracting.
Payment for approved supplements can be a separate final payment from the carrier to the insured for transfer to Riegler Contracting.
