melloInsurance

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depreciation

Is it time for my roof to be updated?

In Saskatchewan, we have many elements of weather. Whether (no pun intended) it is wind, hail, snow, ice, cold, hot or all of the above. We get hammered with it all at different times of the year. To have a building withstand all these elements is quite an accomplishment. However, it does result in a quicker lifetime for many materials in this climate. I don’t know about you, but if I’m working in -30’C or in gale force winds, my efficiency and work ethic takes a bit of a hit. Here is some information for you and how it affects your insurance policy.

Effective 2018, SGI Canada and many insurance companies decided to take a new approach to adjust roof claims. They were now going to apply “depreciation” to roofing materials/labour if damaged by wind or hail. Depreciation is the loss in value due to wear and tear on that particular item.  The reason for this change was that that there is a direct result of the roofs of buildings being worn down due to years of brutality from the elements and factors in our Canadian climate. This causes the life expectancy of our building materials (particularly roofs) to drop.  Here is comparison between an architectural shingle and a typical 3-tab shingle. 

If you have a roof that is 16 years or older, and you have a roof claim for wind or hail, a certain percentage will be deducted from your settlement based on the roofing materials installed on the roof. The table below shows what kind of depreciation will come off your roof in an insurance claim, depending on the materials used. If you are unsure about whether your roof should be replaced or not, contact a contractor through our Kijenga app on our claims section, or find a local roofing contractor to give you an estimate. You don’t want to have a “seepage” issue in your home due to old shingles leaking. Seepage is typically not covered on most policies. 

Roofing Material Used Annual Depreciation
% after 15 years
Asphalt/fibreglass composition shingles (Class 1-3)

10%
Asphalt/fibreglass composition shingles (Class 4)

7%
Architectural Shingles

7%
Membrane Roofing

5%
Metal, Rubber, Synthetic, Polymer, Tiles, Slate, Concrete

2%
Wood Shingles or Shakes

4%
Built-up (Tar & Gravel)

30%
Other

9%
Soffit, fascia, eavestroughs, downspouts connected to eavestroughs

5%

NOTE: Maximum depreciation is 80%, regardless of age.

For example, you have a 19 year old roof with architectural shingles. In this case, SGI Canada would pay to have your roof repaired or replaced, minus 28% depreciation (7% per year for 4 years).

If you have qualified and purchased the SGI Canada “Prestige” policy this would not apply to your home and you would qualify for full replacement coverage for the damages. Please contact us to see if you qualify for this package or want to know more about it. Next week, we will discuss more about this Prestige package and what protection it can offer you and your family.

Do I actually have a roof over my head?


There are many things we take for granted. A roof over our head is one of them. In Canada, the weather can change instantly. Hurricane windstorms to calm and sunny, to ice and snow. We rely on that roof quite a bit, and then we realize how frustrating it can be to fix an issue that starts in the roof and attic. Here is some information to make sure your roof is looked after and how insurance companies now assess claim damages to your roof.

I’m not going to explain how roof systems work, as there are so many different kinds of roofing. Shingles, Rolled Roofing, Metal, Tin, Clay Tile, Metal Tile, Shakes, etc. However, there are some things you can do to make sure you are looking after the necessities.

  • Inspect the roof twice a year; After winter and after summer. These are times of stress on a roof.
  • Keep the roof clean and free from debris.
  • If shingles are curling or free of granules, your roof may need immediate replacement or repair.
  • Make sure your shingles are properly sealed to the roof and that all flashings, rubber washers and other items where there is a seal are in good condition with no cracks – as these are the source of most leaks.
  • Keep eavestroughs and gutters clean – a build up of debris can cause water to not drain properly, potentially causing future water damage issues.
  • Make sure your ventilation is available. All the vents, ridge vents, wind birds, etc. need to be free and clear of debris and never blocked. Proper ventilation ensures heat and moisture do not build up in the attic area. This prevents ice damming issues.
  • Make sure downspouts are installed correctly (directed away from building) as a buildup of water right next to the house can cause seepage issues. (Not typically covered under insurance).
  • Remove branches and leaves from the roof as this can cause mold or moss issues on roof. Especially cedar roofs as they need to breathe.
  • Proper insulation in the attic is important to eliminate any moisture / freezing / condensation issues from occurring. Make sure you check near the edges of the attic as the wind can blow the insulation around creating bare patches.


How do insurance companies look at insuring a roof?

In 2018, insurance companies have started applying depreciation to roofs for wear and tear. Most companies start applying this depreciation on a roof that is around 16 years or older if you put in a claim for wind or hail damage. This means that you’ll be deducted a certain percentage of the claim based on the age and condition of your roof prior to the loss.

This doesn’t mean all roofs will be adjusted the same. For example, if you have a weather-resistant material like a metal tile vs 20 year shingle, the depreciation will be quite different. An asphalt shingle will depreciate at a rate of 10% per year after the 15 years to a maximum of 80% depreciation, regardless of age.

 

  • Asphalt/Fibreglass (Class 1 Shingle) – 10%
  • Asphalt/Fibreglass (Class 4 Shingle) – 7%
  • Membrane Roofing – 5%
  • Metal, Rubber, Synthetic, Slate, Tile, Concrete – 2%
  • Wood Shakes or Shingles – 4%
  • Tar & Gravel – 30%
  • Other – 9%
  • Soffit, Fascia, Eavestroughs – 5%

Example:

If you have a 20 year old roof with asphalt shingles (class 1), the insurance company will pay to have your roof repaired or replaced minus 50% depreciation (10% per year x 5 years).

If you have any questions regarding this coverage or the changes when settling a roofing claim; please contact us. We want to set you up to handle any risk management before a claim occurs. The best thing you can do is be prepared.