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Waiving the deductible rumors

HOW INSURANCE CLAIMS WORK

When an insurance claim is filed on a property, the insurance company is paying fair market value to bring that property back to pre-storm conditions. The property owner for their part, agreed to pay the pre-determined deductible. When the work is done by a contractor for less than the insurance pays, then one of two things will happen: you will either save the insurance company money, or you and your contractor will be committing insurance fraud. Let’s look at some examples of how this works.

In the example below, the value of this roof replacement is $10,000. The insurance company will depreciate your roof by it’s age and hold back that amount in what is called recoverable depreciation, until the job is finished. Once the contractor has finished the roof, they will then invoice the insurance company, letting them know it is finished, and they can then release that last check. The insurance company uses this a safeguard to ensure you get the work done.

So in this example, the most you will receive from the insurance company on this claim is $9,000 even though the work is valued at $10,000. The remaining balance is the deductible, which is then owed to the contractor by the property owner. If the property owner asks contractors for estimates and an estimate the comes in lower at $8,000, then when the contractor goes to invoice the insurance company at the end of the job, the insurance company doesn’t say, “Good job, you found it cheaper. Now you get to keep $1,000 for being so thrifty.” Instead they will say, “Thanks for saving us money...

You can see that as long as all parties are being honest, getting a lower bid does not benefit anyone except the insurance company. In fact, it usually backfires against the property owner, as many roofers will cut corners and use seconds and surplus materials to still remain profitable. In some cases however, roofers will tell the property owner that they will waive their deductible.

INSURANCE FRAUD

When the “deductible is waived” what it really means is that the contractor will still invoice the insurance company for the full $10,000, even though they are only charging $8,000. This is insurance fraud, is illegal and both parties can be prosecuted and are subject to fines. It also means that the contractor is still taking a $2,000 hit on the job which will result in corners being cut on workmanship and materials. The only thing keeping the rain from entering your premises and destroying your possessions and property is your roof. The last thing you want is a sub-par job that could just end up leaking a year or two down the road. Plus, if a contractor will be dishonest with the insurance company, what will keep them from being dishonest with you?

Below is an excerpt from the legal bill just in case you thought we were making it up.

Sec. 27.02. CERTAIN INSURANCE CLAIMS FOR EXCESSIVE CHARGES.
(a) A person who sells goods or services commits an offense if:
(1) the person advertises or promises to provide the good or service and to pay:
(A) all or part of any applicable insurance deductible; or
(B) a rebate in an amount equal to all or part of any applicable insurance deductible;
(2) the good or service is paid for by the consumer from proceeds of a property or casualty insurance policy; and
(3) the person knowingly charges an amount for the good or service that exceeds the usual and customary charge by the person for the good or service by an amount equal to or greater than all or part of the applicable insurance deductible paid by the person to an insurer on behalf of an insured or remitted to an insured by the person as a rebate.
(b) A person who is insured under a property or casualty insurance policy commits an offense if the person:
(1) submits a claim under the policy based on charges that are in violation of Subsection (a) of this section; or
(2) knowingly allows a claim in violation of Subsection
(a) of this section to be submitted, unless the person promptly notifies the insurer of the excessive charges.
(c) An offense under this section is a Class A misdemeanor.

Top Reasons Why Insurance Companies Deny Your Claim for Storm Damage

The approval or denial of your claim rarely has little to do with the amount or lack thereof damage to your home.  There has been an increase in lawsuits and complaints to the Texas Department of Insurance and the Federal Department of Insurance as well as the Better Business Bureau for many insurance companies have been denying residential claims for storm damage. You may be curious to know that a large portion of insurance companies have outsourced their claims department. This gives the insurance company a buffer between you and them. Your agent will often apologize for the denial of your claim and express remorse. They will explain that the independent adjuster is the person who has the power to refuse or validate your claim for storm damage.

Let us evaluate the top reasons why residential claims for storm damage get denied.

The independent company has the responsibility for inspecting all residential claims for storm damage. They have the power to approve or deny your insurance claim. However, the independent company receives their orders from the insurance company. I find this a conflict of interest for the independent adjuster has to consider the ramifications if too many claims are approved. I have met with many adjusters who have told me that if they approve more than 70% of the claims that their annual contract would not be renewed by the insurance company.

The adjuster is the person who evaluates the property for damage. He or she may be very experienced in residential construction or they may have none at all. It is hit or miss with the adjuster you get to process your claim for storm damage. The inspection for damage is very subjective to say the least. I have seen homes torn to shreds with hail damage and the adjuster would deny the claim as mechanical damage. Mechanical damage is a term used for pop nails or it could be for poor craftsmanship. The inspection is purely subjective on the part of the independent adjuster. On the other hand, I have seen times when there has been minimum damage and it could go either way and the adjuster would approve the entire claim. The key factor for approval or denial is dependent upon the experience level of the adjuster who has the responsibility of mitigating the claim for storm damage.

I have had many adjusters convey to me that they were going to deny the claim, but to request a second inspection from the insurance company. I found it strange that an adjuster would tell me to request a second inspection for storm damage. I had worked with this one particular adjuster many times who explained the rationale behind this odd request. He explained that insurance companies have insurance on their insurance policies. The insurance company will often times tell the independent adjuster to deny all claims for they are out of money for the quarter. The adjuster explained that when the money became available for the next quarter they would be allowed to approve the claim. In a nutshell, your insurance provider is waiting for the secondary insurance company to reimburse them for your claim prior to approval.

If weather conditions are bad in your area, this could hurt your chance of getting your claim approved. This may seem odd, but independent adjusters have a certain amount of time to complete the claims they receive from the insurance company no matter how bad the weather. As you can see, if the adjuster gets behind in his reports the only way he can get caught up is by denying a few claims to offset the days of bad weather. He may be inclined to tell you or your contractor to resubmit for a second inspection. This makes no sense for it is an inconvenience to the homeowner as well as a waste of time. The insurance companies are concerned with keeping their double A plus ratings with the review board. If the weather is bad in your area, do not be surprised if your claim gets denied.

Most insurance adjusters are from out of town. They travel from state to state following the storms. You will have a better chance of getting your claim approved if you file shortly after the storm. The adjusters know that if they approve a claim that they will be responsible for the loss report statement until all repairs are completed. Basically, if the roof was measured to be 3900 square feet and there was a discrepancy about the size of the roof structure, then the adjuster is required to come back to the property and re-measure the roof with the roofing contractor. The adjusters are off on their measurements quite often. They measure tight to keep cost as low as possible for the insurance company. Therefore, they come back to about 60% of their claims that they have approved. Toward the end, when request for inspections begin to decline, the independent adjuster will start denying claims in an attempt to keep him from having to come back to that state to mitigate a claim. Once the independent adjuster leaves the state, rarely will your claim be reopened for review.

Roofing Professionals of Texas has been the preferred roofer in Texas. Our professional staff has a vast amount of experience dealing with insurance claims. Do not become a statistic and have your insurance claim denied. Give our professional roofing team the opportunity to be present when dealing with your insurance adjuster.

Marie Aune, Sr. Project Manager

Roofing Professionals of Texas

p:  469-906-2600

w: www.roofingprotx.com

e:  marie@roofingprotx.com

a: 7020 Baker Blvd. Richland Hills TX 76118 

National Roofing Week 2019

National Roofing Week promotes the good deeds of the roofing industry and stresses the value of professional roofing contractors and the importance of making informed decisions about maintaining or replacing any roof system. 

Roofing Professionals of Texas encourages communities and corporations to participate by engaging in their neighbors and informing the public about the essential role roofs and professional roofing contractors play in every community. 

National Roofing Week 2019 is sponsored by National Women in Roofing (title sponsor); ABC Supply Co. Inc.; A.C.T. Metal Deck Supply; Carlisle SynTec; FlashCo; GAF; Polyglass U.S.A. Inc.; and Sherwin-Williams.

For more information about National Roofing Week visit: WWW.ROOFINGPROTX.COM.

(469) 906-2600

Section 179D Tax Deduction for Commercial Roof Replacements

Section 179D Tax Deduction for Roof Replacements

Businesses can now deduct the full cost of a roof replacement in the year it’s completed instead of depreciating over 39 years using the Section 179D tax deduction.

Great news for re-roofing projects in 2018! The Tax Cuts and Jobs Act approved by Congress in December 2017 includes a provision that reduces the overall cost associated with re-roofing projects and significantly improves the cost-effectiveness of commercial roof replacements that comply with building energy codes. Many commercial building owners expect they will able to afford to replace or repair damaged roof systems because they’ll be able to recoup the cost of the re-roofing project when they file their taxes.

5 Reasons Why 179D Tax Deduction is Important News for Roofing Projects:

Allows businesses to deduct depreciable equipment – including the cost of re-roofing projects – as an immediate write-off against that year’s earnings, up to the full replacement cost.

Permits businesses to deduct the full cost of their roof replacement in the year completed instead of depreciating over 39 years, as was required under previous law.

Shortens the average payback period on the cost of installing code-required insulation by 3.5 years: from 11.6 years to 8.1 years, a 21% net savings for C-Corps and 35% for most profitable S-Corps and LLC’s.

Raises the maximum amount a business may expense up to $1 million and increases phase-out threshold to $2.5 million.

Following is more information about Section 179 and the provision to add commercial roofs as qualifying property as of Jan. 1, 2018. This information can help you determine if you may be eligible for this preferential tax treatment for improvements to your roof.

About Section 179D Tax Deduction for Roof Replacements

Section 179D allows taxpayers to immediately expense the cost of qualifying property rather than recovering such costs over multiple years through depreciation. The Tax Cuts and Jobs Act significantly expands the expensing limits under Section 179, with the maximum amount a business may expense now set at $1 million and the phase-out threshold increasing to $2.5 million. These new limits are effective for qualifying property placed in service in taxable years beginning after Dec. 31, 2017, and the amounts will be indexed for inflation starting in 2019.

Who Can Qualify for 179D Tax Deduction

The 179D tax deduction is available to building owners and lessees that make eligible energy-efficient improvements to their commercial buildings, which can include:

Retail buildings

Office buildings

Industrial buildings

Apartment buildings (at least 4 stories)

Industrial/ Warehouses

How to Qualify for 179D Tax Deduction

According to the IRS Tax Officers, a building can qualify for the 179D tax deduction if energy-based improvements are made to the air conditioning system, lights,  or the building’s envelope like the roof. Additionally, the enhancements to these systems must surpass ASHRAE 2001 standards for buildings placed into service before 2016 and ASHRAE 2007 standards thereafter.

There are multiple methods of securing 179D and different levels of deductions depending on the energy efficiency levels that your project meets. Energy consumption cost reductions of as little as 10%, in some cases, can result in very substantial tax savings.

It’s critically important that taxpayers examine and exhaust all of the partial and fractional qualification methods to maximize their benefit.

More Information

Please contact your tax professional if you have questions regarding how you can take advantage of this favorable tax treatment for improvements to commercial roofs.

RoofingProTX, Inc. Do Not Call Policy

ROOFINGPROTX, INC.¹ has adopted and adheres to the following Do Not Call Policy, which applies to the services offered by ROOFINGPROTX, INC., under all of its brands, including, but not limited to, Roofing Professionals of Texas, Starlite Management Services, Southern Girlz Roofing, North Texas General Contractors, Monarch Industries, and their DBA’s: 

1.    ROOFINGPROTX, INC. maintains an internal Do Not Call list (the “RPTX DNC List”) that includes the telephone numbers of customers and potential customers who have requested to ROOFINGPROTX, INC. or its vendors that they not receive telephone sales calls from ROOFINGPROTX, INC. ROOFINGPROTX, INC. has procedures to prevent telephone sales calls for ROOFINGPROTX, INC. consumer products or services from being made by or on behalf of ROOFINGPROTX, INC. to telephone numbers on the RPTX DNC List.

2.    You can add your residential telephone number to the ROOFINGPROTX, INC. Do Not Call List by phone, mail or online form.

• By phone, call ROOFINGPROTX, INC. Customer Support at 855-631-ROOF.
• Mailed requests should be sent to: ROOFINGPROTX, INC. Do Not Call Administrator, 7020 Baker Blvd. Richland Hills TX 76118. Be sure to include your name and all 10-digit telephone numbers you would like to add to the ROOFINGPROTX, INC. Do Not Call List.
• To submit your request online, please fill out the form available on the ROOFINGPROTX, INC. Do Not Call List website. Please note, you must submit a separate form for each 10-digit telephone number.

Should your information change, please notify us of the new name and telephone number(s).

3.    In some cases it may take up to 10 days, but in no case longer than 30 days, from our receipt of your request to be added to the RPTX DNC List. This record will be retained for 5 years unless you ask to be removed from the RPTX DNC List. To prevent ROOFINGPROTX, INC. telephone sales calls after 5 years, you will need to submit a new request to ROOFINGPROTX, INC.

4.    The Federal Trade Commission (“FTC”) offers a free service to consumers that allows consumers to place their residential telephone number(s) on the National Do Not Call Registry.

a.    You may add your residential telephone number(s) to this list either by calling 1-888-382-1222 or through the FTC’s website at www.donotcall.gov.

b.    Under the federal guidelines, telephone sales calls to a consumer with whom ROOFINGPROTX, INC. has an established business relationship are permitted unless the consumer has asked to be included on the RPTX DNC List.

c.    ROOFINGPROTX, INC. regularly compares telephone numbers on its calling lists against the National Do Not Call Registry.

5.    ROOFINGPROTX, INC. trains its employees, agents, and independent contractors whose duties involve placing telephone sales calls to comply with the provisions of the Telephone Consumer Protection Act of 1991, 47 U.S.C. § 227 et seq.; the FTC Telephone Sales Rule, 16 C.F.R. § 310; and applicable state regulations.

6.    The RPTX DNC List restricts telephone sales calls from ROOFINGPROTX, INC. only. ROOFINGPROTX, INC. may continue to contact its customers by telephone for non-solicitation purposes, including, but not limited to, service-related issues, surveys, billing, and other non-sales topics.

7.    If you have questions about this ROOFINGPROTX, INC. Do Not Call Policy, please contact us during normal business hours. Questions about this ROOFINGPROTX, INC. Do Not Call Policy should be directed to the ROOFINGPROTX, INC. Do Not Call legal department at legal@roofingprotx.com.
¹As used herein, “ROOFINGPROTX, INC.” is defined to mean RoofingProTX, Inc. and its subsidiary and affiliated companies.

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Ventilation Calculator Roofing Professionals of Texas (469) 906-2600 www.roofingprotx.com

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