By Steve Taylor
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October 11, 2019
In the world of contracting, most businesses will bite on just about any opportunity to gain yours. This can mean even selling you a promise that is problematic and even in some cases illegal for both parties. And with all the crazy weather that Maryland has had recently, many of you may have experienced damage to your home. If you have homeowner’s insurance this could mean getting the cost of your roof covered at a much lower cost to you which is also where some contractors have found their easy in. How so, you ask? You may have heard strikingly amazing deals where you can get your roof replaced at no cost to you. These roofing contractors are telling homeowners that it is “perfectly legal” to cover their deductible cost on their insurance repairs. Some roofers even go the extra mile to advertise their products as free on yard signs and door hangers. That offer may seem too good to be true, and that’s because it is in fact it is. It’s illegal and here’s why. Homeowners insurance is a binding contract between the homeowner, the insurance company, and the contractor. It outlines the responsibilities of each party should an unexpected incident occur stating specifically that the insurance company is solely responsible for limits, exclusions, and benefits while the homeowner is in fact responsible for the deductible. Homeowners have just as much responsibility should something happen as the insurance provider. This means that when homeowners do not pay their deductibles that it is technically a form of insurance fraud which could result in a loss of coverage and the home. You may be thinking, “Well my friend Susie got hers covered back in ‘08 and her roof was covered complete,” and you may be right. In the past insurance companies would give out lump some payments to homeowners when losses occurred, and the deductible was subtracted from the total sum. For instance, if the adjuster came out and estimated $8,000 in damages and the deductible was $1,000, then they would simply cut the homeowner a check for $7,000. Things are much different today in that insurers include something called a Replacement Cost Value (RCV) provisions into their homeowner’s insurance policies. Which means now, instead of providing a lump sum up front, they will instead disperse payments into separate checks. So, when the insurer goes to subtract the deductible, they also calculate depreciation value and subtract that from the estimate as well. In turn the homeowner receives as smaller check – or series of so when the roofer goes to invoice the homeowner, they may be eligible to recover some of those funds. It really boils down to the cost for the service and the determined value of the roof. All in all, because insurance companies must automatically subtract these costs, a roofing contractor who is promising to pay your deductible is either inflating their prices on your estimate or are cutting corners when it comes to the work they do on your home. When the insurer finds out this is that case, which is more than likely to happen, this is also categorized as fraud and results in significant criminal penalties, ultimately hurting all parties involved. Oh! And just before you start thinking that shopping for a lower price on your roof will save you the expense of your deductible, it won’t. Your deductible always comes first, and the insurance company will subtract that same amount from the cost of the job no matter how big or small the price tag. The bottom line is that there is no escaping it. If you want to protect your family and maintain your investment, then you will pay the $1,000 for something that would ultimately cost you much more had you night filed the claim in the first place. At TNR we pride ourselves in being transparent and doing things the right way. We do our research to make sure that we are not putting ourselves or our customers in jeopardy. When you hire us, it’s much more than getting the lowest price, it’s about having peace of mind. Contact us today at (443) 302-9864 to learn more or follow us on Facebook for more helpful information.