PEOPLE’S TRUST INSURANCE ROOF DEDUCTIBLE AGENT FAQS
- PTI’s Roof Deductible Endorsement follows the approved guidelines outlined in the special legislative session (Statute 627.701).
- What is a roof endorsement or a roof deductible?
A roof endorsement is a modification that adds a new roof deductible to a home insurance policy which increases the policyholder’s responsibility in the event of a roof claim, that helps to reduce their premium.
How does the roof deductible work?
This Roof Deductible Endorsement follows the approved guidelines outlined in the special legislative session (Statute 627.701). It will be automatically added to all new business effective 3/17/2023 and added to renewal business beginning 5/16/2023. The deductible is 2% of Coverage A (dwelling coverage limit).
Is a roof deductible endorsement optional?
The roof deductible will be added to all new and renewal policies by default (per a Notice of Change in Policy Terms for renewals), but the policyholder can opt out by signing a Rejection of Roof Deductible form. In order to obtain the form, please contact Underwriting via chat, email, or phone.
- Does every property qualify for a roof deductible?
Not every property qualifies for a roof deductible. The roof deductible must be greater than the AOP deductible, and the policy must have windstorm coverage.
- When does the Roof Deductible apply?
In the event of a covered loss to the “roof system,” the Roof Deductible, AOP Deductible, or Sinkhole Deductible, whichever is higher, will apply. At the time of loss, if 50% of the actual roof replacement cost is less than the Roof Deductible displayed on the Declarations Page, the Roof Deductible will be reduced to 50% of the actual roof replacement cost.
- A total loss caused by a covered incident
- Damage caused by a hurricane
- Damage caused by a tree or other hazard that damages the roof and punctures the roof deck
- Damage requiring the repair of less than 50 percent of the roof
- Will the insured ever be responsible for more than one deductible?
No. If a roof deductible is applied, no other deductible under the policy may be applied to the loss.
- If there is a total loss, would an insured also be responsible for their roof deductible?
In the event of a total loss caused by a covered incident, the roof deductible does not apply, the corresponding deductible for the peril would instead apply.
- If the insured pays their roof deductible once, and then has another separate roof claim within the same year, will they be responsible for paying the roof deductible again?
The roof deductible endorsement is paid per event, not per calendar year, so if they have two separate covered losses in one year then they would be responsible for their deductible for each separate claim.
- Will my roof deductible stay the same year over year?
Once the endorsement is added to a policy, the roof replacement cost will automatically adjust every year as Coverage A is adjusted. The deductible will always be listed on the Declarations Page with your other deductible selections.
- How is the roof replacement cost calculated? Can it cost more at time of loss?
The deductible is 2% of the Coverage A limit of the policy.
At the time of loss, if 50% of the actual roof replacement cost is less than the Roof Deductible displayed on the Declarations Page, the Roof Deductible will be reduced to 50% of the actual roof replacement cost.
ACV (Actual Cash Value) on a roof is the cost of replacing the damaged roof with a new roof, minus depreciation (decrease in value due to wear, tear, and time), and is calculated at the time of loss; whereas a roof deductible pays the appraised amount for a new roof minus the deductible, which is agreed-upon at the beginning of the policy period.
Other carriers in the Florida market have introduced a similar endorsement on their policies using an Actual Cash Value (ACV) method. People’s Trust believes roof deductibles are a better option than ACV because ACV policies determine the amount of deductible ONLY at time of loss. By not disclosing deductibles up front and leaving them open to interpretation at the time of the claim.
(ACV) the policyholder is exposed to unknown pricing and downside when they are at their most vulnerable – during a claim.ACV example: if a $2,000 television has a useful life of ten years, and the TV is five years old, it has an actual cash value of $1,000.
- Can I add/remove the roof deductible endorsement at any time?
If the policy is eligible, the roof deductible endorsement can be added at any time.
You can remove the roof deductible endorsement by signing a Rejection of Roof Deductible Form at new submission and renewal only.
A PTI Policy Change Request Form must be signed and submitted in order for the endorsement to be added.
If the endorsement is deselected at new business, the Rejection of Roof Deductible Form will be mailed to the insured automatically and will also be available to the agent under the policy’s batched items. The Rejection of Roof Deductible Form must be submitted to underwriting as a part of the new business required documents.
If the Insured wishes to opt-out of the Roof Deductible upon renewal, the Rejection of Roof Deductible Form is required. In order to generate the form, please contact Underwriting via chat, email, or phone. Once generated, the form will be available to the agent under the policy’s batched items and will also be mailed to the insured automatically.
- What happens if I replace my roof?
As a general rule, any time a roof is replaced Agents should inform Underwriting in order to maximize the newly eligible credits.
- Why are roofs suddenly an issue with homeowners insurance?
The increase in fraudulent roof claims in Florida has exponentially contributed to the rise in insurance rates.
Roofing contractors, water mitigation companies, and other businesses that profit by recovering insurance policy benefits to repair or replace roofs or related damage often convince policyholders to submit claims their policy does not cover. Roofing contractors, water mitigation companies, and other businesses that profit by recovering insurance policy benefits to repair or replace roofs or related damage often convince policyholders to submit claims their policy does not cover. These fraudulent claims, and the lawsuits that often ensue because of them, drive up the cost for insurance carriers who then raise rates for policyholders in order to cover these unpredicted costs. According to the Office of Insurance Regulation, Florida accounted for 79% of the nation’s homeowners insurance lawsuits over claims filed, even though Florida only makes up 9% of the nation’s homeowners insurance claims. Florida’s 9% of nationwide claims resulted in 79% of ALL claims litigation in the country. Rising home insurance premiums in Florida are a direct result of this extremely high litigation rate.
The Roof Deductible does not apply to:
Deductibles are not “stacked.”