Making your list, checking it twice and reviewing your insurance coverage

It’s that time of year again when everyone is making lists and checking them twice, but with the New Year fast approaching, it’s also a perfect time for reviewing your insurance coverage to make sure that you are well protected and covered for those unexpected storm events that can damage your roof.

While the hail season of 2012 is becoming a distant memory, winter storms along the Front Range of Colorado can cause significant damage to your roof as a result of windstorms, ice daming, or weight of snow. Roof Worx has helped many homeowners in Ft. Collins, Boulder, Broomfield, Westminster, Denver, Golden, Arvada, Littleton, Parker and Aurora whose homes have sustained these types of damages. Protection for your home and roof for the coming year starts with a review of your insurance policy and coverage. The worst time to discover that your coverage is not what you expected is after you’ve had to file an insurance claim.

There are (4) key questions you should ask when reviewing your insurance coverage.

1. Is your home adequately insured? This is a good time to make sure that your insurance agent and insurance carrier are aware of any major home improvements that you have completed, including an addition you may have added or a new roof that may have recently been installed. Not only does this assure that your property is adequately insured, but also makes sure that you are receiving any premium discounts that may be available such as an insurance discount for installation of a Class 4 Impact Resistant Shingle from CertainTeed, Owens Corning or GAF or from changing a cedar shake roof to an asphalt shingle.

2. Do you have the best insurance policy on your home? This includes determining if your policy provides replacement cost coverage (RCV) or actual cash value coverage (ACV) for damage sustained to your home. It is best to have a policy that provides replacement cost coverage (RCV). This type of coverage entitles you to receive new for old. In the case of damage to your roof, with replacement cost coverage, the insurance company would pay to replace your old shingles with new shingles of same like, kind and quality. Unfortunately, if your policy only provides actual cash value coverage, the insurance company will apply depreciation to the replacement of your old roof based on the roofs age. This deduction can be significant if your roof is 10 to 15 years old and will result in a large out-of-pocket expense to you. The additional premium cost for a RCV policy is usually well worth the price and won’t leave you with empty pockets after an insurance claim.

3. Does your policy have code upgrade coverage? This type of coverage is typically added to the insurance policy via a policy endorsement. This additional coverage is usually inexpensive but has tremendous value. As construction methods and materials improve, building departments increase the requirements to meet certain building codes. Without this coverage, when you need to repair your home after a claim, you will be required to meet your local building code requirements which you will have to pay for. With code upgrade coverage, you are protected if the local building officials require an update of some type. This is particularly true in roofing where code requirements are strictly enforced and your original roof was installed several years ago. Code may now require ice and water shield, drip edge, additional ventilation, etc. which can be quite an out-of-pocket expense if your insurance policy does not have code upgrade coverage.

4. What is your policy deductible? This is the amount that you must pay in the event of damage to your home. In the past, most insurance policies had a flat deductible per occurrence, usually $500 to $1,000. This would be the maximum out-of-pocket expense that would be incurred if your property sustained damage. However, recent insurance industry trends are migrating to percentage deductibles for windstorm/hailstorm damage to your home. This is easily overlooked in your insurance policy and is usually added as an endorsement to the policy. It can come as quite a surprise to realize when you need to have your roof replaced due to recent windstorm or hailstorm damage, that you have a percentage deductible. The other important aspect of this type of percentage deductible is that it is not a percentage of the covered loss, but a percentage of the amount of insurance carried on your home. This percentage deductible can be from 1% to 3% of the total amount of insurance on your home. So, if your home is insured for $200,000 and has a 2% wind/hailstorm deductible, your portion of any covered claim would be $4,000 and not the flat rate deductible usually listed on the declarations page of your policy. Be especially vigilant on any renewals of your homeowner’s policy. Many times, insurance companies make changes to your policy during the renewal so it pays to read all of the information contained in the renewal offer.

For more information about reviewing your insurance coverage, or any of your roofing, siding, or gutter needs, contact Roof Worx your local roofing experts at (303) 353-1825. Roof Worx, Thornton, Colorado.