There’s little question that Florida homeowners face challenges insuring their properties, not least due to the constant threat of hurricanes and severe weather. A key aspect of Florida home insurance that often goes overlooked, but can significantly impact your financial recovery after a roof claim, is the concept of a “roof schedule” or “roof depreciation.” Understanding how some home insurance companies in Florida apply this can save you from unexpected out-of-pocket expenses.
What is a roof schedule?
Many homeowners insurance policies offer “Replacement Cost Value” (RCV) coverage for your house. This means that for a covered loss, the insurer pays the cost to repair or replace your damaged property with new materials, without deducting for depreciation. However, due to the high volume of roof-related claims in Florida, particularly from wind and storm damage, some home insurance companies have introduced endorsements that modify how roofs are covered. This is where a “roof schedule” comes into play.
A roof schedule, often called a “Roof Surfacing Payment Schedule,” means your roof is covered based on its Actual Cash Value (ACV). ACV accounts for depreciation, so the payout reflects your roof’s current market value at the time of damage, considering its age, wear and tear, and overall condition. So, even if your roof cost $20,000 to install new, after 10 or 15 years, its ACV could be much lower.
How roof schedules work
Many insurers offer a roof schedule endorsement to lower your annual premium. Accepting a policy with a roof schedule, you agree that if there’s a wind or storm claim (the most common culprits for roof damage in Florida), your payout will be reduced based on your roof’s age.
For example, a typical roof schedule might specify a percentage of depreciation per year for different roof materials. A shingle roof, with a shorter lifespan, might depreciate faster than a tile or metal roof. If your 12-year-old shingle roof, with an expected 20-year lifespan, is severely damaged in a hurricane, the insurance company would calculate its depreciated value. Your claim payout would be that amount, minus your deductible. This can leave a substantial gap between the insurance payout and the actual cost of a full roof replacement.
A trade-off: Lower premiums for lower payouts
The main benefit of a policy with a roof schedule, of course, is a lower annual premium. For homeowners with older roofs who might struggle to secure traditional RCV coverage, or those looking to reduce their yearly insurance expenses, this can seem attractive. Florida law even allows insurers to offer optional roof deductibles and policies that factor in depreciation, especially for older roofs.
If your roof is 15 years old or more, insurance companies can’t just force you to replace it before offering or renewing your policy. Instead, they have to let you get a roof inspection. This inspection checks if your roof still has at least 5 good years left in it. Because of this law, it’s become much more common for insurers to offer policies for older roofs that pay out based on the roof’s current, depreciated value (ACV), rather than the cost of a brand-new one.
However, you need to weigh this saving against the potential for significant out-of-pocket costs if your roof is damaged. While your premium might be lower, a major roof claim could result in you paying thousands of dollars yourself to cover the difference between the depreciated value and the actual replacement cost.
Find the best Florida home insurance quotes
Deciding which path to take when it comes to your roof coverage—lower premiums or lower payouts—can be a difficult choice. At Home Insurance Florida, we have the experience and expertise needed to help you compare policies from various home insurance companies and clearly explain details like roof schedules and their implications. Whichever way you decide to go with your roof schedule, we’ll work with you to make sure you have the coverage that best fits your needs and budget. Get in touch with Home Insurance Florida and get the best home insurance quotes available.
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About Home Insurance Florida
At Home Insurance Florida, we specialize in helping Floridians protect their homes cost-effectively all year round. With the right insurance safeguarding you against unforeseen risks, we offer personalized advice and tailored coverage options. Contact Home Insurance Florida, and let our experienced agents find the best insurance quotes that Florida has to offer.
