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Insurance Claims Guide: What to Expect After a Windstorm

Is your home office or place of business protected against adverse weather conditions?

Is your home office or place of business protected against adverse weather conditions which may reduce revenue or increase expenses? If not, it’s time to protect your business from severe weather risks with the right insurance coverage.

Photo: Chantal M. Roberts, CPCU, AIC, RPA | Courtesy

For example, roof damage after a windstorm can be stressful and confusing for the insured. Understanding the insurance claims process and why your insurance carrier might not immediately pay for all the damages can help ease some of that stress.

It’s critical to be aware of key aspects pertaining to roof damage claims, including substantiating the claim, the difference between the initial estimate and the actual payout, various types of coverage, and what holdback depreciation means.


Steps to Take After Sustaining Roof Damage

Document the damage

Often with catastrophic losses such as those incurred by tornadoes or hurricanes, it will take the adjuster several days to inspect your home or business. Take photos and videos of the damage as soon as it is safe to do so. Send it to the adjuster. This documentation will be crucial when filing your claim.

Protect property from further damage

If you are able, put a tarp on your roof to prevent further leaking inside your home. If you are unable, hire a contractor; keep the receipts for consideration in your claim. Your policy requires you to prevent further damage to your home.

Contact your insurance company

Report the damage to your insurance company as soon as possible. It is a requirement of your policy. They will guide you through the claims process.

Get repair estimates

Many carriers have preferred vendors and offer premium discounts if you enroll in the preferred vendor program. You may choose your own contractor. You should obtain estimates from licensed contractors. This can help you understand the cost of repairs and assist in discussions with your insurance adjuster.

Keep receipts

Save all receipts related to repairs and temporary fixes. These will be necessary when you file for the holdback depreciation.


Initial Estimate vs. The Check: Understanding the Difference

When you file a claim for windstorm damage to your roof, the insurance company will send an adjuster to inspect the damage and provide an estimate. This estimate outlines the cost to repair or replace the damaged roof. However, the check from the carrier might not match this estimate, and that can be distressing.

Several factors contribute to the difference between the estimate and the check:

Policy conditions

Your insurance policy Conditions determine how payments are made. Understanding them are crucial. For example, if you have an actual cash value roof endorsement on your policy in exchange for a lower premium, the most you will receive in the loss is the ACV of the roof damage, less your deductible. This can mean significant out-of-pocket expenses.

Actual Cash Value (ACV) vs. Replacement Cost Value (RCV)

ACV policies pay the depreciated value of your roof, which means you receive the current value of the roof, considering its age and condition. In contrast, RCV policies cover the cost to replace your roof at today’s prices without considering depreciation.

Initial ACV Payment with Depreciation Holdback

Even if you have RCV coverage, your policy initially pays the ACV of the damages. The remaining amount, known as the “holdback depreciation,” is paid after the repairs are completed and documented. This ensures that the funds are used for their intended purpose—repairing or replacing the damaged roof.


Your policy includes a deductible, the amount you need to pay out of pocket before your insurance coverage kicks in. This amount is subtracted from the total payout.

Costly Repairs

Sometimes the actual repair costs exceed the carrier’s estimate. This is not uncommon, since estimating damages can be a combination of art and science. If there is a discrepancy, notify your insurance company and ask for a supplemental inspection. They may review your contractor’s estimate or ask your contractor to meet them for a joint inspection. The carrier will reassess the damage and adjust the payout accordingly.


What is Holdback Depreciation?

Holdback depreciation is the difference between the replacement cost and the actual cash value. It is the amount that is “held back” by the insurance company until the repairs are completed. This practice ensures that the insurance payout is used appropriately for repairs. Here’s a breakdown of how it works:

  • Initial Payment: When the damage is assessed, the insurance company calculates the damage to your roof, which is the estimate of damages. The estimate shows the replacement cost to repair the roof, the depreciation, and the actual value of your roof. The carrier issues an initial payment based on the actual cash value of the roof.
  • Completion of Repairs: After you complete the repairs, you submit the receipts and documentation to your insurance company.
  • Release of Holdback Depreciation: The carrier reviews the documentation and releases the remaining funds, covering the full replacement cost, less your deductible.


Prevent Future Wind Damage

While you can’t control the weather, you can take steps to minimize future damage:

  • Regular Maintenance: Keep your roof in good condition by inspecting it regularly and addressing any issues promptly.
  • Upgrade Materials: Consider using wind-resistant materials when replacing your roof. Some insurance companies offer discounts for such upgrades.
  • Trim Trees: Keep trees and branches trimmed away from your roof to reduce the risk of damage from falling limbs during a storm.


Final Thoughts

Handling a roof damage claim after a windstorm can be complex, but understanding the process and your insurance policy can help you manage it more effectively. By knowing the difference between ACV and RCV, the role of holdback depreciation, and why your initial payout might not cover all the damages immediately, you can better prepare for and handle the claims process.

Always document the damage thoroughly, communicate clearly with your insurance company, and keep detailed records of all repairs and expenses. With the right knowledge and preparation, you can ensure that your home is repaired and protected against future wind damage.


Chantal M. Roberts, CPCU, AIC, RPA, is a self-described insurance nerd with over 20 years of experience as a multi-lined claims adjuster. She is also an award-nominated author who has previously written two books, one for mid-career adjusters, The Art of Adjusting: Writing Down the Unwritten Rules of Claims Handling, and a creative nonfiction story about Molière, A Love Story: How the Heartland Fell in Love With a 400-Year-Old French Comedic Playwright. Her new book, Once Upon A Claim: Fairy Tales to Protect Your Ass(ets) (May 11, 2024), provides consumers with a better understanding of property and casualty insurance and claims. Learn more at cmrconsulting.net.


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