The Problem(s) With Hail Claims, Part 1: A Cautionary Tale for Insureds and Insurers
By Bill Wilson | May 20, 2024
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On an asphalt shingle roof, under every exposed shingle is a layer of another three tab roof shingle creating two layers of roofing. Under that is the rolled roofing that is applied before the shingles. Hail damage is in many instances only cosmetic damage to the top most layer of shingles. In this instance it is unlikely for hail damage to only become known following a heavy rain with water entry or that the water entry is due to hail. Hail damage sufficent to cause water entry would be visible and a timely reporting requirement reasonable.
Great article, well written and thought provoking on how the industry should continue to refine their approach to wind/hail exposure.
I find it “interesting” that when one buys a book the purchaser generally reads it through. I assume most “hard cover” books cost under $50. Homeowners insurance costs a whole lot more!
Excuse 2: the policy language is too complicated. Really? What happened to the “readability requirement”?
Insurance agents and brokers are (generally) not required to determine whether the insurance requested meets the insured’s reasonable expectations. If the policy doesn’t provided coverage for the event/loss, the courts generally rule that in the absence of
“special circumstances” any finding of “no coverage” is usually the result of the insured’s failure to read his/her policy.
Harsh? Yes. Realistic? Yes.
What party is in the best position to know the insured’s (or prospect’s) exposures???
Readability and comprehension are two different things. The first often involves short sentences and understandable words, but combine this into dozens of pages of terms that link and cross reference each other, and comprehension becomes an issue. As a commercial insured whether their commercial property form covers detached signs and, if so, for what perils and for how much coverage? It’s a “Where’s Waldo?” search.
Does a homeowners policy cover the use of riding lawn mowers? That should be easy to ascertain in a “readable” policy, but…. https://www.insurancejournal.com/magazines/mag-features/2020/10/05/585125.htm
The long term answer to most of the hail damage situations on roofs is for insureds to convert to steel panel standing seam roofs, tile or something other than composition. I converted to a steel panel standing seam roof in 2011 and it has paid off several times over. I got hit with baseball size hail June 2023 with no damage to my roof but, I did lose several windows and mirrors on my car. My neighbor had to replace his composition shingle roof for the third time since I converted to a steel roof.
The insurance company sends out their own adjuster right? Its Insurance companies call not the consumers, who knows nothing about roofs. I paid my premium and expect the insurance company to keep up their end of the deal.
I once had a bit of an ethical challenge in this regard.
Having moved from the Norteast to the Midwest, I had never experienced a serious hail storm. Then, one night, the hail thundered down, and I thought: “There’s going to be a lot of damage in the morning.” I later woke up, went out and, to my surprise, there was no damage that I could detect, other than early spring buds driven to the ground.
About a week later, the storm chasers start canvassing the neighborhood, informing folks they could get their roofs replaced courtesy of their homeowners insurer. I begged off, recognizing what was happening.
Soon after that, crews started replacing roofs throughout the neighborhood. Being in the insurance business, I wondered if my rates would go up regardless of what I did. So I contacted my insurer, a major national carrier, and it sent out an adjuster to inspect my property.
It was as if Santa had come early.
The adjuster climbed about my dwelling and detached garage, took photos, and offered full replacement cost recovery for all my roofing and siding. She wrote the ACV check then and there, and told me the balance would come upon completion of the work. She asked me almost nothing; I volunteered nothing.
There’s no moral to this story. I had been anticipating a major expenditure to upgrade my roofing and siding; then I received a wind(hail)fall. I’m no building expert. If MY OWN INSURER (not a strom chaser) says there was damage, who was I to argue?
Joe, I’ve had the same experience multiple times from storm chasing roofers, often from 200 miles away. The first time it happened I was out of town and my wife let one of these locusts onto our roof where, of course, he found extensive hail damage even though the hail storm that came through didn’t even hit our part of the neighborhood.
So, I got two local reputable roofers to take a look and both said we had no hail damage. One of them said there were markings on some shingles and flashing that looked like they were made with a ballpeen hammer. Local roofers who have been in business for decades don’t have to chase storms…they have plenty of business by reputation alone.
Still, as you say, it seems that so many insurers simply pay the claims rather than risk a prolonged battle or possibly litigation. This simply feeds the frenzy.