April 08, 2020

Raising the Roof on Insurance Coverage

Not all coverage is equal – especially when it comes to the roof over your head.

This is Missouri and, unfortunately, our unpredictable weather means we’re very familiar with roof damage. The Missouri Department of Commerce and Insurance (DCI) wants consumers to know that insurance coverage has changed dramatically over the last decade. Nowhere is this more obvious than in coverage of your roof.

“It’s really important that consumers know exactly what type of coverage they have or they’re planning to purchase,” says Chlora Lindley-Myers, Director of DCI. “Policies may not cover the replacement cost of your roof – your policy may only cover a depreciated cost, or the actual cash value, to repair or replace your property.”

The department recommends that consumers check the declarations page of their homeowner’s policy to see whether the policy provides replacement cost coverage. Under a Replacement Cost Value (RCV) or an Actual Cash Value (ACV) policy, there may be other limits on what the policy will pay for damage to certain surfaces, such as roofs.

In an insurance claim, the amount deducted for depreciation may be significant, especially if the damaged property was at or near the end of its useful life. For example, if your 20-year-old roof is destroyed by a covered cause of loss and must be replaced, the policy that pays RCV will cover the full cost to replace the roof. However, an ACV policy may pay as little as 20% of the cost to replace the roof, since the useful life of a roof is usually about 25 years.  

To assist Missouri consumers, the department has produced a tool that provides information about roof coverage for the top twenty homeowners insurance companies in the state. If a company is not listed, this comparison shopping form is available to help the shopper ask the right questions and record information as they research options for new coverage or seek to understand their existing coverage.

For more information about homeowners insurance or for assistance with questions or complaints about an insurance company or claim, visit insurance.mo.gov/consumers or call (800) 726-7390.