If you’ve received a home insurance renewal recently and noticed changes to your roof coverage, you’re not alone. Across Kentucky and much of the country, insurance companies are making significant changes to how they insure roofs.
Many homeowners are surprised when they learn that roof coverage today looks very different than it did just a few years ago.
Why Are Insurance Companies Making Changes?
Over the last decade, insurance carriers have experienced record losses from wind, hail, and severe weather events. At the same time, the cost of roofing materials and labor has increased dramatically.
As a result, insurance companies have had to adjust their underwriting guidelines and coverage options to remain financially stable.
Some of the changes we’re seeing include:
- Higher wind and hail deductibles
- Roof age restrictions
- Actual Cash Value (ACV) roof settlements
- Roof payment schedules based on age
- Increased inspections and underwriting reviews
- More scrutiny on tree branches touching roofs and roof condition
Replacement Cost vs. Actual Cash Value
One of the most important things homeowners should understand is the difference between Replacement Cost and Actual Cash Value coverage.
Replacement Cost Coverage
This pays the cost to replace your roof with similar materials at today’s prices, minus your deductible.
For example:
If your roof costs $20,000 to replace and your deductible is $1,000, the insurance company may pay approximately $19,000.
Actual Cash Value Coverage
This coverage takes depreciation into account.
Using the same example:
If your roof is older and has depreciated by 50%, the insurance company may only pay $10,000 before your deductible.
That leaves the homeowner responsible for a much larger portion of the replacement cost.
Why Roof Age Matters
Many insurance companies now evaluate roof age much more closely than they did in the past.
Depending on the carrier, roofs may face restrictions at:
- 10 years old
- 15 years old
- 20 years old
Some companies will only offer Actual Cash Value coverage on older roofs, while others may decline coverage altogether.
This is why updated roof information is becoming increasingly important when shopping for insurance.
Wind and Hail Deductibles Are Increasing
Many policies now include percentage-based deductibles for wind and hail claims.
For example:
A home insured for $500,000 with a 1% wind/hail deductible would have a deductible of $5,000 for a wind or hail loss.
These deductibles are becoming more common, especially in areas that experience frequent storms.
What Homeowners Can Do
The good news is that homeowners still have options.
- Maintain your roof
- Regular inspections and maintenance can help extend the life of your roof and improve insurability.
- Trim trees
- Many carriers now require tree branches to be trimmed away from the roof.
- Keep documentation
- If you’ve replaced your roof, keep invoices, permits, and photos. Insurance companies often ask for proof of replacement.
- Review your coverage
Not all insurance companies handle roof coverage the same way. One carrier may offer Replacement Cost coverage while another only offers Actual Cash Value.
The Importance of Working with an Independent Agent
As roof coverage continues to evolve, it is more important than ever to review your policy and understand how your roof is covered before a claim occurs.
An independent agency can compare multiple insurance companies and help you understand:
- Replacement Cost vs. Actual Cash Value
- Wind and hail deductibles
- Roof age requirements
- Coverage options available for your specific home
The goal is simple: no surprises when you need your insurance the most.
If you have questions about your current roof coverage, we’d be happy to review your policy and explain your options.
Holly McMillin Insurance Group
Protecting Kentucky families, homes, farms, and businesses with personalized insurance solutions.