How much will this cost?
What about my deductible? The roofer said he would
take care of it.
All the other roofing companies told me that I would
pay nothing out of my pocket.
They said they would take care of all the special
Sounds too good to be true! Well, it is too good to be true. Can you
The truth is this: We will replace your roof for the replacement cost
value that your insurance company assesses.
The money the insurance company awards you is for the replacement of the
roof. They know what a quality roof installed by a quality crew costs – they
spend millions of dollars a year in replacing roofs, and they try to keep
their costs down. There is no ‘fat’ in their assessment – they pay for
quality as they do not want to spend good money on a marginal roof put on by
a marginal crew.
Now read on to learn about insurance fraud and then scan down further to
read up on insurance terms.
In the simplest terms, fraud occurs when someone knowingly lies to
obtain benefit or advantage or to cause some benefit that is due to be
denied. Make sure the invoice you submit to the insurance company is a true
reflection of the work done. Anyone can report insurance fraud.
The following information is from the Georgia Insurance Information Service.
What is insurance fraud?
Insurance fraud is an attempt to obtain money from insurance companies by
arranging a loss or accident or falsifying information on applications for
insurance claims. Fraud can range from large, organized operations involving
hundreds of thousands of dollars to an otherwise honest individual who
overstates a legitimate claim.
What is the penalty for being found guilty of insurance fraud?
In most of its forms, insurance fraud is a felony. When caught,
prosecuted and found guilty, most fraud perpetrators are required to make
restitution and jail time is also commonly imposed.
What is the most common types of fraud cases?
Insurance fraud can be divided into three categories:
False claims for injuries
Arson for profit
False or intentional auto theft and physical damage
What is the insurance industry doing to reduce fraud?
The insurance industry is committed to reducing fraud by teaching claims
professionals how to recognize suspicious claims and work with law
enforcement and fire services. Insurance companies have units trained to
What can citizens do to reduce fraud?
People who want to fight back against this crime should contact the
Georgia Department Of Insurance, 404-656-2060,
The Department's Insurance Fraud Hotline 1-800-726-6070,
The National Insurance Crime Bureau (NICB) toll-free at 1-800-TEL-NICB to
report fraudulent acts,
The Georgia Arson Control Program at 1-800-282-5804 to report
Callers may be eligible for rewards of up to $10,000 from Georgia Arson
Control if their information leads to arrests and convictions of arsonists.
What effect does fraud have on the average policy holder?
The insurance industry estimates the size of insurance fraud to be about
10-15 percent of the premium dollar. This puts the yearly costs at an
estimated $18 billion nationally. As fraud is reduced or eliminated, claims
costs can be lowered and those savings can be passed on to policyholders.
Basic Insurance Terms
Replacement Cost Value (RCV)
Most home owner insurance policies are “replacement cost” policies. The
replacement cost value (RCV) is the amount of money the insurance company
has determined that will repair or replace your loss. The replacement cost
value is designed to repair or make new your loss by replacing “same for
same”. (three tab shingles for three tab shingles, etc)
INSURANCE COMPANIES KNOW WHAT IT COSTS TO REPLACE YOUR ROOF AND REPAIR
This is their business; in fact, they often attempt to minimize their claim
payouts. That is the reason most insurance companies request that the policy
holder show the repair or loss summary to a qualified roofing company to
make sure all repairs are addressed.
Your deductible is essentially the amount of risk you, as the policy holder,
decided to own (per claim). It is your portion of the loss or replacement
There are two type of depreciation: recoverable and non-recoverable.
In the simplest of terms, recoverable depreciation is the amount of money
being held back by the insurance company until they receive proof
that your damaged property has been repaired.
The proof is an invoice for at least the amount of the Replacement Cost
If you submit an invoice for less than the RCV, the insurance company will
deduct the difference from the depreciation check. (We will replace your
roof for the replacement cost value that your insurance company assesses.)
Non-Recoverable depreciation is an amount that represents the current value
(prorated value) of your damaged property. I.e. if you have a 20 year roof,
and it is ten years old, the depreciation amount would be 50% of the
original value of the roof. Each insurance company has a different formula
to determine this type of depreciation. In the end, non-recoverable
depreciation is the amount of money you will never recover from the
Actual Cash Value (ACV)
In simplest terms, ACV is:
Replacement Cost Value – Depreciation = Actual Cash Value
Your initial award or check will be:
Actual Cash Value – Deductible
Your final check will be for the amount of recoverable depreciation, based
on a true invoice totaling an amount equal to or greater than the RCV. This
invoice is for the replacement of your roof. You pay for the additional
amount greater than the RCV; these may be for shingle or ventilation
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