House valuation for homeowners insurance total loss claim

My house was consumed by a wildfire here in Colorado this past June. It was declared a total loss (it was completely burned down to the foundation). Working with the insurance company on the claim has been less painful than I imagined it would be, but I’m trying to figure out what to do with the estimate they have given me for the dwelling coverage (The amount for removing and replacing the foundation, house, deck, driveway, and landscaping).

The estimate that the adjustor gave me is very detailed (about 16 pages long) and includes many little and big items. However, it was based on a short interview with me and the county records (which are wildly inaccurate for my house). Therefore, it’s missing a lot of things (i.e., the basement finish, one of the bathrooms, a lot of the size estimates for siding and walls seem very low, there’s no way my deck could have been built for the amount they allowed, etc.).

The adjustor said I should have a contractor spec a house that is the same is the one that was lost. The house I’m planning to build in its place is different in many ways, so that information cannot be used.
I’ve made a detailed list of the details of each room in the house (size, finish items, electrical, plumbing, windows, etc.) and made some estimates about what the size of outside features would be. The blueprints for the house seem to not exist at the county building office any more (it’s 1980’s tract housing and the original builder doesn’t exist either). I have some photos and an appraisal report from 2010 to back up my claims.

Is there a person that does the job of converting this information into an itemized list similar to what the insurance adjustor gave me? I don’t want to bother the contractor of my rebuild with it since he’s busy getting everything together for that and doesn’t want to spec out a house that he isn’t going to build. Is this what public adjustors do? What types of fees should I expect to pay for something like this?

On a related note, my insurance company has specified both profit and overhead at 5% each. A co-worker in a similar situation, but with a different insurance company has them specified at 10% each. What is standard?

No answers for you but really sorry to hear about the loss of your house in the wildfire. Glad you’re ok!

As I understand it, the insurance company is only required to rebuild the house that was lost, not a better house your want to eventually live in. You get that, however since you don’t intend to rebuild the exact same house that was lost you both need to agree on what it would have cost if you rebuilt that house.

I don’t see the County being much help here, and I don’t see anyway around finding a contractor to spec out the house that was lost and provide you with a written estimate to rebuild it just as it was. I realize this may seem like wasted effort, but in the end you and the insurance company will agree upon a cost that they would be willing to write you a check for.

5-10%for profit sounds reasonable… but you need to look at the insurance paperwork you signed to see if 5% is spelled out somewhere. IMO they can’t hold you to a number you never agreed to.

any building contractor can run plans and an estimate for your old structure from your description. they might charge $100 to $200 for a materials list and drawing.

A public adjuster would be delighted to assist you in return for a fee at about 10% to 20% of the gross settlement so you must decide if that amount is worth their service.

I presume you have advised the adjuster of the insurance company’s estimate omissions and the reply was basically for you to get your own estimate. Adversely, if you have not told them that their estimate is incomplete, get together with the adjuster in order to supplement the estimate to reflect apples to apples on the replacement cost of the dwelling. Tell them you appreciate their offer but you are unable to consider it since it lacks accuracy.

If the insurance company stands by the “get your own estimate” approach, this is what you should do because it is up to you to prove your loss.

My advice is to communicate with the adjuster or their supervisor and let them know you would like to settle this matter on the dwelling and the best way would be for them to simply prepare a supplemental estimate in order to reflect a dwelling of like kind and quality.

On the overhead and profit, the percentage varies from state to state (by custom) and I’ve seen lows of 5% each to highs of 10% OH and 15% profit.

Thank you for the feedback. It sounds like I should prepare a detailed rebuttal to the items I don’t agree with in their initial estimate. Obviously, I plan to be polite and professional (well, as professional as someone not in the business can be). If that gets me an acceptable response, then I can skip the step of having a contractor spec out the old house or getting a public adjustor. A friend was nice enough to lend me a 2012 construction pricing guide, so I hope that can help me argue some of the numbers as well.

One other question – since the blueprints and engineering drawings for the old house seem to no longer exist, I would have to hire a home designer or architect to create them. Would I be able to argue that fee is required to be reimbursed as well? (Even though the home designer I’m going to eventually hire will be creating a different house.) I was told this runs in the $2 to $4 per square foot range locally, so it’s a significant expense.

i don’t think you need a designer. a contractor can take your description of the building (number of rooms and sizes, number of windows and sizes, siding, roof, etc) and make a materials and labor list from it. they can also make a large drawing on a paper using computer software (not a detailed blueprint). cost could be $100 or $200.

Oh, I don’t mean for the estimate, but the fact that I do need to hire one for the rebuild. It wasn’t mentioned anywhere in the estimate I was given, but I’m thinking it should be covered since I can’t build a new house without it (even if it was the same floorplan as the original house)

The insurance company, in my experience, will not reimburse you for the cost of a home designer or architect because, as another poster explained, this cost in unnecessary in rebuilding the home as it was as a contractor has this ability. Also, if an insurance company paid this expense, they would actually be paying you for an expense to submit the claim and this is usually not done.

There have been situations when an insurance company may hire an engineer in order to evaluate a claim but I have never known them to do this on a total loss because there’s nothing left to evaluate other than the cost to rebuild which is easily done by a general contractor.

Naturally, you goal is to settle on a fair cost to rebuild your structure based either on the company’s estimate or that of your contractor and rebuild another dwelling to your liking.

If you have a mortgage, have they advised you the mortgagee will be a co-payee on the dwelling settlement check? It’s not normally a big ordeal to work with the mortgage company, but sometimes the adjuster overlooks passing this info on and the insured is unaware until the check arrives.

Sorry to hear that, but what you do over here is get quotes from at least 3 local builders of good repute for direct replacement - you give them copies of the floorplans if you have them - and submit the quotes to the insurer. Who will likely then choose the cheapest.

I finally heard back from my claim adjustor and she did inform me that they do pay for a home designer and engineering necessary to build the new house. Basically, this is because this information is no longer available for the old house and is necessary to be completed in order to rebuild the house. (obviously, with the caveat that this is included in the limits set forth in the dwelling rebuild portion of coverage) Another friend had a good point that the old plans would most likely not meet building codes today anyway and would need to be redone to some extent even if they were available.

Glad to hear it.

On the potential increased cost due to building codes, most Homeowners policies have language explaining the availability of this coverage and I presume this has been discussed with the adjuster to verify you have what you seek.