Roof Insurance Explained: Coverages, Claims, and Loss Settlements
Roof insurance isn’t a standalone policy like identity theft coverage or inland flood insurance. Instead, it’s part of your homeowners insurance or business insurance that applies when your roof is damaged as a result of a covered event.
In this article, we’ll answer common questions about roof coverage and explain key terms, including roof loss settlement and actual cash value, so you can better understand how your policy works — and what to expect if you ever need to file a claim.
Does Insurance Cover Roof Replacement?
Roof replacements and repairs are typically included in the dwelling coverage — also known as Coverage A — portion of your homeowners policy, as long as the damage is caused by a covered event, such as wind and hail damage.
While homeowners insurance provides valuable protection, roof coverage can vary. Insurance providers consider factors, such as your roof’s age, condition, materials, and shape, when determining eligibility and how much they’ll cover toward a repair or replacement.
Most policies also include a standard deductible and certain exclusions. For example, cosmetic damage or damage caused by wear and tear, poor maintenance, or improper installation is generally not covered. If you live in a storm-prone area, you may also have a separate wind and hail deductible. Reviewing your policy details in advance can help you avoid surprises if your roof ever sustains damage.
What Is Roof Loss Settlement?
When a roof claim is approved, the amount your provider pays depends on the type of roof loss settlement outlined in your policy. This clause determines how much of your roof replacement cost is covered and whether you’ll need to pay anything out-of-pocket.
Most homeowners insurance policies use one of three settlement types: replacement cost value (RCV), actual cash value (ACV), or roof payment schedule.
What Is Replacement Cost Value (RCV)?
This is the most comprehensive option. It covers the full cost to replace your roof with a brand-new version at today’s prices. It does not cover any upgrades you choose to make during the replacement process.
What Is Actual Cash Value (ACV)?
An ACV policy pays out based on the depreciated value of your roof at the time of the loss. This type of settlement often comes with lower premiums and can be a practical option for older roofs. Since depreciation is factored in, the payout may not cover the full cost of a new roof, meaning you’ll be responsible for covering the difference.
What Is Limited Loss Settlement?
Also called a roof payment schedule, this increasingly common settlement type bases your payout on a fixed percentage of the roof’s replacement cost, typically determined by factors like the roof’s age. For example, a roof over 20 years old may only qualify for a payment equal to 25-40% of the total cost to replace it.
Does Insurance Cover Roof Leaks?
In general, homeowners insurance helps cover roof leaks when they’re caused by a covered event, such as a storm or falling tree. If the leak is the result of normal wear and tear, lack of maintenance, or an aging roof, it likely will not be covered.
While insurance can help repair roof damage, prevention is your best defense. To help maintain eligibility for roof coverage and avoid future leaks, trim overhanging trees, keep gutters clear, and schedule professional roof inspections to catch potential issues early.
How to Navigate Roof Insurance Claims
If your roof is damaged, knowing when to file a claim can make all the difference. You should file a claim only when the damage is caused by a covered event and when the cost of repairs exceeds your deductible. Here’s what to do if you suspect roof damage:
- Limit additional damage: Take temporary steps like tarping exposed areas to prevent further issues.
- Document everything: Photograph the damage to help support your claim and give your insurance provider a clear picture of the loss.
- Contact your insurance company: File a claim online or call 800.243.0210, option 3, as soon as possible to start the claims process.
- Choose a reputable roofing contractor: If your claim is approved, work only with experienced, insured professionals.
Protect Your Home and Roof With Insurance
Understanding your roof coverage is one of the best ways to prepare for the unexpected. Knowing what’s covered, how roof loss settlement works, and when to file a claim helps you navigate your insurance with confidence. If you’re unsure about what your policy includes or whether your roof is adequately protected, take time to review your policy documents and talk to your insurance agent.
Ready to help safeguard your home or business from the roof down? Find an agent today to get a quote.