A roof insurance estimate lists every item the adjuster agreed to pay for, prices it at replacement cost value (RCV), subtracts depreciation to reach actual cash value (ACV), then subtracts your deductible to reach the net claim, which is the first check you receive. If your policy pays replacement cost, the depreciation comes back after the roof is built. I'm Aaron Scott, a licensed Michigan residential builder and owner of Roofing Army, and our office reads these estimates for homeowners across Southeast Michigan every week. Here is how to read yours.
What Are the Main Sections of an Adjuster's Roof Estimate?
Most carriers produce estimates in Xactimate or a similar estimating program, so the layout is fairly consistent from one insurer to the next. You will usually find:
- Header: claim number, date of loss, adjuster's name, and the policy's loss settlement basis.
- Roof sketch and measurements: a diagram of each slope with pitch, area, ridge, hip, valley, eave, and rake lengths. Every quantity on the estimate flows from these numbers.
- Line items by room or area: the roof is usually its own section, with interior rooms listed separately if water got in.
- Summary page: the totals that matter, from RCV down to the net claim.
What Do the Roof Line Items Mean?
Each line has a description, a quantity, a unit, a unit price, and a total. Roofing quantities are in squares (SQ), where one square equals 100 square feet of roof area, or in linear feet (LF) for edge materials. Here are the lines you should expect on a full replacement:
| Line item | Unit | What it covers |
|---|---|---|
| Remove / tear off shingles | SQ | Labor to strip the old roof, sometimes listed per layer |
| Laminated or 3-tab shingles | SQ | New shingles including a waste factor for cuts |
| Roofing felt or synthetic underlayment | SQ | Underlayment over the deck |
| Ice and water barrier | SQ or SF | Self-adhering membrane at eaves and valleys |
| Drip edge | LF | Metal edge at eaves and rakes |
| Starter strip | LF | First course along eaves and rakes |
| Ridge cap | LF | Cap shingles on hips and ridges |
| Flashing, pipe jacks, vents | EA or LF | Step flashing, plumbing boots, roof vents, ridge vent |
| Steep charge / high charge | SQ | Added labor for pitch above about 7/12 or roofs above two stories |
| Debris haul and dump fees | EA or per load | Disposal of the old roof |
Compare this list against your estimate. Missing lines are the single most common reason an adjuster's number lands below a real contractor's price, and they are exactly what a supplement addresses. Our guide to roof insurance supplements covers the items that get left off most often.
What Is the Waste Factor, and Why Does It Matter?
Shingles come in bundles, and every roof loses material to cuts at hips, valleys, rakes, and around penetrations. Estimating software adds a waste percentage to the shingle quantity to account for this. A simple gable roof might carry around 10 percent; a hip roof cut up with dormers and valleys needs more. If the estimate's waste factor is too low for your roof shape, the contractor cannot buy enough shingles to finish for the approved price. Ask what percentage was applied and compare it to the roof sketch.
How Do RCV, Depreciation, and ACV Work on the Summary Page?
The summary page is where the money is decided. Read it top to bottom:
- Line item total / RCV: the sum of every line at today's replacement prices. This is what the insurer agrees the roof costs to replace.
- Sales tax: applied to materials where applicable.
- Overhead and profit (O&P): if included, typically shown as two separate 10 percent additions for a general contractor's overhead and profit. More on when this appears below.
- Less depreciation: the age and wear deduction. Watch for two labels here: recoverable, which is paid later if you have replacement cost coverage, and non-recoverable, which is gone for good.
- ACV: RCV minus depreciation.
- Less deductible: your share under the policy.
- Net claim: ACV minus deductible. This is the first check.
Here is a worked example using our published price for the roof replacement at 53495 Hillside Drive in Shelby Township, $16,890.38 for 2,692 square feet of roof. The depreciation and deductible figures below are hypothetical, chosen to show the math:
| Summary line | Amount |
|---|---|
| Replacement cost value (RCV) | $16,890.38 |
| Less recoverable depreciation (hypothetical 30% of materials) | ($3,000.00) |
| Actual cash value (ACV) | $13,890.38 |
| Less deductible (hypothetical) | ($2,000.00) |
| Net claim (first check) | $11,890.38 |
| Recoverable depreciation (second check after completion) | $3,000.00 |
| Total insurance payment on an RCV policy | $14,890.38 |
On an ACV-only policy, the second check never comes and the homeowner's share rises from $2,000 to $5,000. That is the whole difference between the two policy types, which we explain in ACV vs RCV roof insurance in Michigan.
Michigan note on the depreciation line: according to Michigan Department of Insurance and Financial Services Bulletin 2024-26-INS, for homeowners and dwelling policies issued or renewed on or after January 1, 2025, insurers may depreciate labor, taxes, fees, and overhead and profit only through a standalone optional endorsement. If your estimate depreciates every line including labor and you never bought that endorsement, ask the adjuster to explain.
What Does "Net Claim" Actually Mean for Your Payout?
Net claim is the amount the insurer is sending now, not the value of the claim. Homeowners regularly look at a net claim of $11,890 on a $16,890 roof and assume the insurer only approved $11,890 of work. That is not what happened. The insurer approved the full RCV; it is simply paying in stages and subtracting your deductible from the first stage. If the check is made out to you and your mortgage company, the lender will usually need to endorse it, so start that paperwork early.
When Does Overhead and Profit Belong on a Roof Estimate?
Overhead and profit compensates a general contractor for coordinating a job. In estimating software it is calculated as 10 percent for overhead and 10 percent for profit on the covered work. Many carriers apply an informal guideline that O&P is owed when three or more trades are involved, for example roofing plus drywall plus painting after a leak. That guideline is a carrier practice, not a law, and it is disputed regularly. If your loss involves interior repairs alongside the roof, look for an O&P line; if it is absent, ask why. On a roof-only claim, most carriers will not include it.
What Should You Check Before Accepting the Estimate?
- Every slope is on the sketch and the total square footage matches an independent measurement.
- Ice and water barrier is included at eaves and valleys, and drip edge at eaves and rakes. Both are required by the Michigan Residential Code and are frequently missing.
- Starter strip and ridge cap are separate lines, not assumed to be cut from field shingles.
- Steep and high charges appear if your roof is steep or more than two stories.
- Depreciation is labeled recoverable if you carry replacement cost coverage, and it is not applied to labor unless you have the endorsement.
- The deductible matches your declarations page, including any separate wind or hail percentage deductible.
Bring the estimate to a licensed contractor before you sign anything. We review adjuster estimates against our own drone and on-roof measurements as part of every storm damage inspection, and we meet the adjuster on site when the inspection is still ahead of you. From there the process is the same as any roof replacement we do: line-item transparency on the quote, a project manager on site, 6 feet of ice and water shield at the eaves, and no deposits at any point. If the roof is currently open, emergency tarping comes first and is usually part of the same claim.
We work with homeowners and adjusters across Shelby Township, Troy, Oxford, and the rest of Southeast Michigan. If you have not filed yet, start with our guide to filing a roof insurance claim in Michigan, and check our job gallery to compare the estimate in your hand against real, published roof prices near you.
Frequently Asked Questions
Why is my adjuster's estimate lower than my contractor's quote?
The most common reasons are missing line items such as ice and water barrier, drip edge, starter strip, or steep charges, a waste factor that is too low for the roof's shape, and measurements that undercount the roof area. Compare the two documents line by line. Differences in scope are handled through a supplement; differences in unit pricing are negotiated with the adjuster.
What does 'recoverable' next to depreciation mean?
It means the insurer has held that amount back rather than deducted it permanently. Under replacement cost coverage, recoverable depreciation is paid once you complete the repairs and submit the final invoice. Non-recoverable depreciation is subtracted for good, which is what happens under an actual cash value policy or a roof payment schedule endorsement.
Is the net claim the most the insurer will pay?
No. The net claim is the first payment: actual cash value minus your deductible. If your policy pays replacement cost, the recoverable depreciation is paid later, and approved supplements for items the original estimate missed are added on top. The total you can collect is the final agreed replacement cost minus your deductible.
Should the estimate include overhead and profit on a roof-only claim?
Usually not. Overhead and profit is typically added when a general contractor coordinates multiple trades, and many carriers use an informal three-trade guideline. A roof replacement with no interior work generally will not include it. If your claim involves roofing plus drywall, painting, or other trades, ask whether O&P was considered.
Can I get the estimate changed after I accept the first check?
Yes. Cashing the initial check does not close the claim in most cases. Supplements for hidden damage found during tear-off, code-required items, or measurement errors are submitted after the first payment as a matter of routine. Confirm with your adjuster that the claim remains open, and keep every revision in writing.
