Hail, roof damage and insurance

It seems that every year two or three hail storms blow through town (Austin, TX) immediately followed by a migration of roofing companies eager to put up new roofs paid for by insurance companies. In the past 20 years or so I’ve gotten a free roof on my own house plus three or four free roofs on some of my rental properties.

Last week I went up on a roof with a contractor to inspect damage from the latest storm and sure enough he found enough damage to justify replacing the roof. To my eyes it looks like pretty insignificant damage. Because of the direction of the storm only one face of the roof (about one fourth of the total roof) was damaged, and the guy had a hard time finding enough hail marks to qualify for a new roof, but he managed it.

So now I get a new, free roof. I don’t even need to pay the deductible and I never have. In each case the roofing contractor has said outright that he can give me a price that will be well under the insurance company’s expected payout, and that’s been the case. So once again, new, free roofs for everybody!! And everybody’s happy - or so it seems. I get a new roof, the roofers get a lot of money, and the insurance companies at least don’t seem to mind.

Well, fine I suppose, but something’s very wrong with this. First of all, I have a hard time believing that the tiny amount of damage I saw justifies the replacement of the entire roof. Surely they can make a shingle that can withstand minor hail damage. Or what about some kind of patch that you can apply to the individual hail marks?

Every time this happens I feel like I’m participating in some sort of grand scam, so I just let the roofers and insurance company work things out and I go along with whatever they agree to.

So what’s really going on here? Is a roof really ruined by ten hail strikes in a ten square foot area? Am I allowing myself to be a party to an illegal activity? Why does everyone seem OK with the status quo?

Finally, a question I can answer with authority.

There is nothing going on illegally, in general, by what you have described-with the exception of you not paying your deductible. The roofing company and you are committing insurance fraud. This is very common, unfortunately, and rarely prosecuted. When the roof is completed, the roofing company or you should be sending in receipts, permits, etc. If they are eating your deductible, that means that they are falsifying their invoices.

As to damage-Insurance companies have determined that they would rather pay for a new roof now, rather than wait for the roof to deteriorate so much that there would be additional interior damage.

There are standards that insurance companies have determined to meet the threshold of functional damage-something that is going to negatively effect water shedding capabilities, and the life span of the roof. This has to be caused by a storm- it cannot be because of maintenance or mechanical/human damage (in most cases.) It’ll typically run 6-16 hits per SQ (100 SF) some companies want to see the mat of the shingle broken, some do not.

Now, here is where it gets complicated. In most situations, insurance companies have local “staff” adjusters that live in the area all the time, and deal with claims. They’re typically on salary. When there is a catastrophic situation-like Ike, or even severe storms, the insurance companies do not have enough local adjusters to handle all the claims. They then contract out with independent insurance adjusters, who are typically paid on a per claim basis. In addition , the larger the claim, the higher the fee schedule.

Now, I need to put in a caveat-even though the independent adjusters would naturally be more likely to approve an iffy claim, because they make more money, they still have to be able to justify the payout, or risk losing their jobs, or in rare instances, perhaps paying the claim themselves.

However, understand it is always easier to say “yes” to a homeowner than “no.” Especially when some other insurance company is buying everything they see. No one likes to be the bad guy, even insurance companies.

Roofing contractors almost always see damage, whether it’s there or not. A lot of times you are dealing with a roofing salesman, who has little to no experience in determining damage, or construction, or insurance, and was probably selling cars or cell phones last week.

They do make shingles that are hail impact resistant. They are more expensive, and no roofer is motivated to put them on, really. Some insurance companies will give a discount on your premium.

Any other questions?

Excellent answer. Thank you very much.

:eek: Well, that sounds pretty serious to me. Even if they never prosecute, I and everyone else in the neighborhood are committing insurance fraud. Isn’t that a felony?

Beyond that, this just sounds like a grossly inefficient way of doing business and an environmental nightmare to boot. With all the technology and innovation in materials these days, it’s hard for me to accept that no one has come up with a single shingle solution. (Try saying that three times fast.)