The insurance company already read your policy. The question is whether you have — and whether you know what to do with what it says.
I sat down with a client not long ago. Roughly a $50 million building. Multiple roof sections — some newer, one that had been on the roof for about fifteen years.
They knew their insurance policy. They'd owned the building for years. They had a broker. They had a roofing contractor.
What they'd never had was someone put the roof and the policy on the table at the same time.
When we did, the numbers weren't comfortable.
The insurance carrier had underwritten the entire building based on the oldest roof section. Not just that section — the entire property.
One aging roof section was setting the terms for a $50 million property.
Their wind and hail deductible had increased from 2% to 5%. They were paying nearly $100,000 every year just to buy that deductible back down to 2%. And because the roof had moved to Actual Cash Value (ACV), the exposure underneath was worse than it looked. At 5%, a $4 million claim would have netted them roughly negative $400,000 — the deductible and depreciation together swallowing the payout. They'd have been writing a check, not receiving one.
That $100,000 a year wasn't fixing the coverage. It was buying down the worst version of it.
No one had ever shown them how those pieces fit together. Not their broker. Not their previous contractor.
That's more common than most owners realize.
The insurance company understands your policy. The question is whether anyone has helped you understand how your roof affects it.
Five Things Worth Checking Before the Next Storm
1.Is your roof covered at ACV or Replacement Cost?
Replacement Cost Value (RCV) pays what it costs to replace the roof today. Actual Cash Value (ACV) pays today's value after depreciation. Those two numbers can be dramatically different.
On buildings with multiple roof sections, carriers often look at the oldest section when underwriting the property. One aging roof can influence how the entire building is insured.
Ask your broker: Are our roofing systems insured on ACV or RCV, and what caused that determination? If the answer isn't immediate, it's worth investigating.
2.What is your actual wind and hail deductible?
Many commercial owners assume their deductible is a fixed dollar amount. Often it isn't — it's a percentage of the building's insured value.
Most owners have never calculated that number. Pull out your declarations page and do the math.
3.Have your code upgrade limits kept up with your building?
After a major loss, you're rebuilding to today's building code — not the code that existed when the building was constructed. That difference is covered by Ordinance or Law coverage, if you have adequate limits.
Many policies contain only minimal built-in coverage unless higher limits were added. Ask your broker: When were our Ordinance or Law limits last reviewed? If the answer is "I don't know," that review probably hasn't happened.
4.Could your business survive the time required to rebuild?
Business Income coverage should reflect how long your business would actually be interrupted — not how long it used to take to rebuild a building. Permitting, material lead times, labor availability, and code compliance have all extended recovery timelines.
If your income protection runs out before your building is operational, the difference comes from your business — not your insurance company.
5.Who pays for everyone you'll hire after a major loss?
Major claims rarely involve just contractors. You may also need architects, structural engineers, consultants, and other professionals. Those costs have to come from somewhere.
In one claim we reviewed, architect fees alone consumed the policy's built-in code-upgrade coverage before reconstruction even began. It's worth knowing where those expenses would be paid from before you need them.
Why We Have These Conversations
Credo isn't an insurance broker, and we don't sell insurance. We evaluate roofs.
Sometimes that means we discover the roof is affecting the insurance policy in ways the owner didn't realize. Sometimes it isn't. Either way, it's better to find out before a storm than during a claim.
The client I mentioned at the beginning eventually replaced the aging roof section. The new roof restored Replacement Cost coverage, eliminated the annual deductible buydown, and changed the economics of the property.
None of that happened because the insurance company changed its mind. It happened because someone finally connected the roof to the policy.
The insurance company already knows what's in your policy. The question is whether you do.
The insurance company already knows what's in your policy.
The question is whether you do.