Code Upgrades

Have recent building code upgrades knocked your home roof outside the scope of the manufacturer’s warranty? Alpha Roofing can help get you back to compliance, and maybe get your insurance to pay for it!

Alpha Roofing Helps You Stay Compliant, Longer.

If you’re one of the forward-thinking individuals who chose to invest in Building Code Upgrade coverage inside your homeowner’s insurance policy, you have no fears of how to pay for upgrades to your home roofing when the building codes change. Unfortunately, many homeowners might not even know that building codes have changed, and potentially knocked their home roof out of warranty. But did you know that many insurance agencies will quite often pony up for the upgrades you need to make in order to keep your shingles or your roofing system under warranty coverage? Why would they do this? Aren’t insurance companies notorious for never wanting to pay for ANYTHING?

Catastrophic Loss Vs. Partial Replacement

If you have encountered catastrophic loss, some insurance companies will allow you to work new code upgrades in with the roofing replacement, but sometimes this takes real effort. Most Homeowner Policies don’t include code upgrades without the advent of a disaster event. If you don’t have the right professional on your side, you could lose these negotiations with your provider. But with the experienced pros from Alpha Roofing, you will absolutely get the highest dollar amount for your new roof from your insurance company. Without code upgrade coverage, your total costs of roof replacement could be 30-50% higher. Most roofers don’t take time to include code upgrades in the initial negotiations with your insurance company. But Alpha Roofing will.

Insurance and Code Upgrade – How Does it Work with a Writer?

While it is normally true that they don’t like to pay out unless they absolutely have to, the Insurance Company’s position can be understood very simply: if it’s less expensive to pay for your code upgrades than it would be to pay for your roofing materials out of warranty, they are far more likely to negotiate with you. Roof decking, metal drip edge roofs, and water valley shields are common recent code upgrade victims for many Georgia homeowners and business owners. It’s also important for a roofing contractor to be aware, as well as your insurance company, that repairing or replacing your home roof with “similar materials,” or “materials of like quality,” instead of using approved products, might void your entire roofing system’s warranty.

If you have questions regarding recent code upgrades where you live or work, and how certain changes might affect your manufacturer’s warranty, Alpha Roofing is here to help answer any questions you might have. We can even work with your Insurance Company to see if your code upgrades could be paid for inside the scope of your Homeowner’s Insurance Policy. Call or contact our professionals today, and schedule a FREE on-site assessment of your home roofing needs.

ACV vs RCV alpha roofing temple

ACV and RCV Policy Differences

Understanding how ACV and RCV coverage works, and knowing what you have, can be a huge difference maker for you and your family.

What Are the Most Basic Differences Between ACV and RCV Homeowner’s Coverage?

At the most basic level, ACV stands for Actual Cash Value, while RCV stands for Replacement Cost Value. While an ACV policy might be more affordable in the short run, a homeowner’s policy with an RCV endorsement (upgrade) will likely far outweigh the total coverage capacity of an Actual Cash Value policy.

Why does an RCV policy offer more coverage than ACV? Simple. Depreciation costs.

ACV policies limit the risks for the insurance company and reduce the maximum amount the insurance company is obligated to spend towards replacing your roof by depreciating the value due to the roof’s age. When you buy a new home or have a recently replaced roof this could seem reasonable at the beginning of the policy period, but soon the amount available to replace your roof becomes insufficient as the actual value of the roof depreciates over time.

RCV policy endorsements do a better job of putting the interests of the homeowner first by guaranteeing full, like-new, replacement regardless of the age of the roof when disaster strikes. (There is usually a maximum lifetime total limit to how much the insurance company is liable to cover—most often no more than the appraised value of your home.)

ACV vs RCV Scenarios – Which Coverage Is Better for Your Family?

Let’s say that two neighbors moved into identical new homes in 2005 with roofs guaranteed for 30 years. They both purchased homeowner’s insurance from the same insurance company. Fifteen years later, a tornado ripped the roof off both houses in 2020, and they are each facing $20,000 in roof replacement costs.

The first neighbor saw a way to save 10-20% every year by purchasing a homeowner’s insurance policy using the Actual Cost Value (ACV) valuation method. Just for simplicity sake, let’s say they spend $600 on their yearly homeowner’s premiums.

The 2nd family understood the long-term value of an insurance policy with a Replacement Cost Value (RCV) endorsement and were willing to pay an additional 20% every year for their policy to take advantage of significantly better results in the case of a catastrophe. Their hypothetical policy costs $720 per year with full roof replacement included.

Example:

Family #1

Yearly Premium – $600

Coverage – ACV

2020 Roof Costs – $20,000

Insurance Deductible – $1,000

Insurance Payout – $9,000

Total Out-of-Pocket – $11,000

Family #2

Yearly Premium – $720

Coverage – RCV

2020 Roof Costs – $20,000

Insurance Deductible – $1,000

Insurance Payout – $19,000

Total Out-of-Pocket – $1,000

The ACV policy holders would have saved around $1,800 or so in yearly policy costs. But when the insurance companies started their valuation process, they would be up the creek without a paddle. Depreciation costs over 15 years on a roof with a 30-year lifespan would be 50% or more. When you subtract that amount from the originally estimated costs ($20,000), you’re only sitting on $10,000 of roof replacement money. Subtract the deductible, and you’re down to around only $9,000 from the insurance company.

But the RCV policy holders would have quite a different outcome, due completely to the fact that their policy calls for Replacement Cash Valuation. It ignores any depreciation costs for replacing the roof. Their policy covers the entire $20,000 cost of replacing their home roof, minus the deductible, of course. So even with a $1k deductible, the RCV family has $19,000 in hand to replace their home roof. You could definitely say that a $19k payout is better than $9,000 payout, and well worth the extra $1,800 in policy premium costs over the span of 15 years.

For any questions about ACV vs RCV, your homeowner’s insurance policy, or any other roofing questions, call or contact your friends from Alpha Roofing. We’ve been serving our friends and neighbors in Metro Atlanta and West Georgia since the very beginning. Call today, and see what we can do for you!