In the current insurance landscape, most homeowners carry Replacement Cost Value (RCV) policies. However, some newer or budget-friendly policies are written as Actual Cash Value (ACV), which can lead to significant out-of-pocket costs during a claim.
An RCV policy pays the cost to replace the roof at today's market prices, minus the deductible. An ACV policy subtracts depreciation based on the age of the roof, often leaving the homeowner responsible for thousands of dollars in material costs.
Policy Reviews
It is standard practice for adjusters to apply 'recoverable depreciation' on RCV policies only after the work is completed and an invoice is submitted. Homeowners should verify their policy type before hail season peaks.
Knowing the age of your roof is the first step. If a roof is over 15 years old, some carriers may automatically convert the policy from RCV to ACV at renewal. Checking your declarations page annually is a recommended safeguard for Texas residents.