Will Insurance Cover a 10 year-old Roof?

The answer is that yes it can be insured, with ACV coverage which stands for Actual Cash Value. Beginning in 2025, insurance companies stopped offering RCV (Replacement Cost Value) coverage on roofs 10 years old and older.

Each insurance company follows their own depreciation schedule for ACV coverage. A common standard is that on a 10 year-old roof, the insured (or homeowner) pays 44% out-of-pocket. The older a roof is, past those 10 years, the more depreciation is applied and therefore the higher the percentage will be that the insured pays out-of-pocket.

Some Key Insurance Terms

Non-recoverable Depreciation

Non-recoverable depreciation is the portion of an item’s value lost over time due to age, wear, or obsolescence that an insurance company will not reimburse, even after repairs or replacement are completed.
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Recoverable Depreciation

Recoverable depreciation is the portion of an insurance claim that covers the difference between an item’s current, depreciated value (Actual Cash Value) and the cost to replace it new (Replacement Cost)

It is withheld by insurers until you provide proof that repairs or replacements are completed.

ACV - Actual Cash Value

Actual Cash Value (ACV) is the amount an item is worth at the time of loss, calculated as its replacement cost minus depreciation (age, wear, and tear). It represents the current market value rather than the cost to buy a new replacement. ACV policies offer lower premiums but provide smaller payouts than Replacement Cost Value (RCV) policies.

RCV - Replacement Cost Value

Replacement Cost Value (RCV) is an insurance policy feature that covers the cost to repair or replace damaged property with new items of similar kind and quality, without deducting for depreciation.

ACV Schedule

An ACV (Actual Cash Value) schedule, often referred to in insurance as a Roof Payment Schedule (RPS) or similar depreciation table, is a pre-determined, age-based chart used to calculate the payout for a damaged item by subtracting depreciation from its replacement cost. It determines the value of assets, like roofs, based on their remaining lifespan rather than current market replacement costs.

Depreciation

Depreciation is the reduction in an item’s value over time due to age, wear and tear, or obsolescence, which reduces the Actual Cash Value (ACV) paid in a claim. It represents the difference between the replacement cost and the item’s current worth. It is often used to calculate initial payouts, but it can sometimes be recovered if you have replacement cost coverage.

Impact Resistant Shingles

Some carriers waive the 10 year ACV schedule if the shingles are Class 4 and/or Class 3 impact resistant shingles.

It is very important to check with your insurance agent regarding roof age ACV schedules and impact resistant shingle policies.

Many insurance carrier offer between 20-40% insurance discounts for having impact resistant shingles.

Having an insurance agent is not the same as having an insurance policy. Some insurance carriers do not have a physical location with a person whom you can ask questions of. If you do not have an insurance agent then you will need to call your insurance company and try to get to someone who can answer policy questions. This is typically an 800 number.

There is an advantage to having an insurance agent, being that you can ask direct questions without mush hassle.

Buying a Home

When you buy a home with an old roof, you are running the risk of having to pay non-recoverable depreciation on an ACV schedule for the roof to be replaced for hail damage.

For example, if you purchase a home with a 10 year-old roof and the very next day hail comes and totals out the roof then you will be paying 44% out-of-pocket to replace the roof.

Our roof inspections are always free and we can establish the age, condition, class, color and manufacturer/brand of your shingle. We are the only company with a former insurance adjuster with an AIC and HAAG Engineering credentials.

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This blog is NOT legal advice. It is not insurance policy advice. You should consult and attorney and/or a licensed insurance agent for your specific situation.

Will insurance cover a 10 year-old roof