Homeowners need to pay special attention not only to their wind/hail deductible in Colorado, but how exactly their insurance company will cover the roof. There are three main types of ways that an insurance company will pay out for a roof.
1 - Cash Value
The first type is actual cash value, if you have this type of policy, they just pay for the roof based on depreciation not the cost to replace it. So, if your roof is 10 years old, they may pay out $6,000 but it costs $12,000 to actually replace it. I highly suggest everyone stays away from this type; the low deductible they offer may look appealing, but it’s not worth the thousands you would be paying out of pocket if it needs to be replaced.
2 - Full Replacement Cost for First 10 Years
The second type is where they do full replacement cost for the first 10 years of roof life, but then after that it’s based on depreciation only. Again, if your roof is brand new, this could be a good policy but you really have to keep track of when it will switch to actual cash value and plan accordingly.
3 - Full Replacement Cost
The third type is full replacement cost. In my opinion, these are the best way to insure your roof. The only downside is there might be a higher deductible, $2500-$5000 for example. However, no matter how old the roof is, they will pay to do a full replacement. You will get the most pay out from the insurance company with this type of policy. Even if it isn’t the cheapest quote you get, it’s worth paying the extra premium to have much better coverage.
Need to find out how your roof is covered? Call your insurance agent or broker. Ask them exactly what the wind/hail deductible is and how they cover the roof. You could also reach out to a broker that can offer full replacement cost with all of their companies and ask them to shop the rates.
For an expert assessment of your insurance contact Grace at 303-807-4410.