Mother Nature decides to play a fun little game and rips off half of your siding. The siding has been on your house for 15 years and is no longer available.
Insurance Company X comes along and agrees to replace the siding since wind is a covered loss. However, since the siding is no longer made, you have to pick a different type of siding and the two don’t match. You’re enraged. It will look like crap. The whole house needs to be re-sided in order for it to match. How can the insurance company do this to you? *insert one of 300 other possible complaints here*
Familiar with this scenario? Has it happened to you or someone you know?
Here’s where the average person falls down when it comes to understanding this situation:
The insurance policy is only designed to put you back where you were before your loss. So, if you have a hole in your house, the insurance company’s obligation is to repair the hole. If you are missing siding, they are obligated to put siding back on. If you’re missing roofing, their obligation is to put roofing where the wind ripped it off. See a pattern here? The technical name for this is indemnification- providing compensation for a loss in order to restore an individual to the approximate financial position prior to the loss.
Notice I DIDN’T say they are obligated to make it match and look aesthetically pleasant, complete with a rainbow, puppy dogs and chirping birds sitting on your windowsill.
The policy simply doesn’t say that. Trust me- NO insurance policy sounds THAT pretty (don’t I wish). Don’t get me wrong- it’s not like the insurance company is going to slap on new red siding next to your existing canary yellow siding. And they do try to do what they can. But claims adjusters are bound by the policy.
So you can imagine the insurance industry has had many arguments with homeowners concerning this exact situation.
Enter Erie Insurance
My office, Alan Galvez Insurance, is an Erie agency. We love Erie- they’re trendsetters and do a lot of things differently than a typical insurance company. So, in keeping with their reputation, they decided to introduce a coverage that aims to eliminate these siding and roofing arguments.
****Dwelling and Other Structures Siding and/or Roofing Restoration Coverage****
Ta Dah! A long title, but the purpose is this: to reimburse the insured for the cost of replacing undamaged siding and/or roofing of the dwelling and other structures when the materials found on the covered loss area are no longer available.
Go back to my first example- after the windstorm, you discover your 15 year old vinyl siding has been discontinued. Depending on which option you purchase, you would have up to the amount purchased to replace all the siding so it’s a match. Nice solution isn’t it?
Important note- This coverage will not apply to mismatches due to weathering, fading or normal wear & tear. But, if the siding or roofing is simply not manufactured anymore or otherwise available, it would.
$10,000 coverage is the minimum available, with a maximum of $25,000. This coverage is bundled with several other options, but I’ve seen annual premiums for the bundle to be between $50 and $75. Pretty decent investment to save a lot of heartache.
I think this is a great solution to an age-old argument and one I make sure to offer to my customers. If you want to discuss this way cool option and how it could work for you, contact me and I’ll be glad to take a look at your homeowners policy (Ohio folks only). Homeowners insurance is my specialty and I’m even writing a book on it (scheduled for release next month)! You can sign up below this post to get updates on the book’s progress- “Insuring Your First Home: Your Must-Have Guide to Make the Process as Painless as Possible.”
Questions? Comments? Fire away below……And if you dig what I’m sharing, please share with others!