If you just received your latest HO-3 homeowners insurance renewal offer with a new endorsement, well you’re not alone. With Florida-focused insurance carriers still licking their wounds from the effects of Hurricane Ian and Idalia, as well as the financial constraints caused by COVID, the industry is tackling the issue of unprofitability in multiple ways – one of which is by reducing your coverage. One new endorsement making its way into renewal offers provided by some insurance carriers is called a “Roof Surfaces Payment Schedule Endorsement”. Well, what in the world does that mean? Let us explain!
Before this endorsement is added to your HO-3 Homeowners insurance policy, the policy itself covers the roof of the dwelling for its replacement value should it be damaged by a covered peril beyond the ability to repair it. The policy normally does not respond differently or in different amounts simply due to the age of the roof itself. This new endorsement changes that, and adds a unique limitation to your policy, specifically with how roofs are covered and how their age at the time of a claim can affect how a claim is paid. This endorsement introduces a payment schedule that diminishes the roof’s covered value as the roof gets older. To review the endorsement provided by one specific carrier, their payment schedule works as follows: During the first year after a roof is replaced (and the carrier is made aware of the new roof) the roof is covered for 100% of it’s replacement cost if a claim were to occur. By the time the roof is 5 years old, the value decreases to as low as 80% for some roof types, and by the time it’s 19 years old the value could be as low as 25%. It’s important to note that the roof material also plays a role in the rate of value diminishment – the schedule makes it clear that the replacement value of a shingle roof decreases in value much quicker than a concrete or clay tile roof does.
The Florida Office of Insurance Regulation has reviewed and approved the use of such endorsements on HO-3 homeowners insurance policies, provided the insurance carrier provides a discount to the customer for accepting the endorsement. If you have recently received a Florida homeowners insurance renewal offer and would like a second opinion, our team would love to help. We have direct relationships with hundreds of insurance carriers for all types of different needs and we surely have a competitive offer for you. Start by visiting us online at evolveins.com or call our office at 941-244-2760 and ask to get started a new quote today.
Owner, Evolve Insurance Agency
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