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ROOFING BIDS AND THE TRUTH
Roof Bids should not be obtained to settle an insurance claim. With a typical roof replacement, you will probably have a few contractors give you several bids. Although when it comes to storm restoration, getting multiple bids can actually hurt the value of your home. Furthermore, benefiting your insurance provider.
Let me explain it for you.
Your main goal is to restore your home back to pre-storm conditions, with compensation from your insurance company. Your insurance company has to pay you their summary amount or your contractors roof bids, whichever is lower. In addition, the deductible will be taken out of this amount. Insurance companies are not trying to cheat you out of the compensation that you deserve, they just don’t want to pay any more than they are legally required. Getting multiple roof bids makes it easier for your insurance company to pay you less.
Here is the analogy I use to help explain why roof bids should not be considered.
Say that I want to take you out for dinner, and I am going to pay for it. If I wanted to pay less money for the meal I could ask for you to provide me with three options and then I would choose the least expensive one. The quality of food at the least expensive restaurant might be poor compared to the other two, but I would save money and you would still get a full stomach. But, let’s say you made reservations to a restaurant and decided to eat there. As a result I would be obligated to pay for the meal even though it might be more expensive because I had already made a commitment to pay. In this example you are better off by selecting the restaurant you want to eat at rather than giving me the option to choose the least expensive.
THE DIFFERENCE IN THE COST
$7,221 is the average bid given for roof replacement. Most contractors will produce a bid that is lower than the actual cost to replace the roof, so they can gain business. As a result they cut corners so they can still make a profit.
AVERAGE INSURANCE CLAIM
$8787 is the average claim paid out by insurance providers. This is a more realistic cost to replace the roof. With this amount of money granted to the contractor they can instal the proper materials. As a result increasing the value of your home.
A few reasons why getting multiple roof bids are bad.
Estimates are typically lower than the insurance scope of loss.
- Scope of loss is an itemized list with predetermined market pricing of services an insurance company covers. This pricing includes labor and materials, and is updated monthly. If there is high demand due to a recent storm in you local area, the summary pricing will increase. In fact, the price of roofing materials can increase during storm season.
- Your insurance company will likely encourage you to get roof bids from several roofing companies in the hopes that the roof bids will be lower than the summary pricing. Roofing companies will almost always bid lower than the scope of loss pricing, because that is how they win business over their competitors.
- Your goal as a homeowner is to get the most compensation possible from your insurance company. Going with the lowest bidder is not going to help you in this situation.
Your insurance may not pay for any additional damage found during the repair.
- When the insurance company accepts a bid to replace your roof, you will only get that amount, minus your deductible. More damage is usually found with storm damage. Your insurance company will say that they agreed to the original bid from the roofer. Furthermore, not responsible for anything the roofer failed to find when putting together the bid. However, when you hire a company that agrees to work for the scope of loss, they will file for a supplement. A supplement is the cost to repair any additional damage found. Your insurance company will be more likely to approve and pay for supplements.
Companies that give bids will usually offer discounts that result in a poor quality of work, and material.
- Think of our restaurant example above. If we chose the less expensive option, the quality of food was not as good. When it This is the same when it comes to roof replacement. If a company has a lower price than its competitors, most of the time they cut corners in order to make a profit off the low bid they gave you to gain your business.
- These companies will install a less quality of roofing material and even reuse the damaged material that is already on your home. They would rather put a “cheap” roof on your home, than miss out on your business.