It’s entirely possible that your contractor is right. There are quite a few reasons for legitimate differences between the estimates prepared by your insurance adjuster and the contractors. Let’s look at a few ways to begin identifying and addressing those differences.
Ask your contractor to provide an estimate before providing the adjuster estimate. A competent contractor should provide a detailed estimate based on an inspection independent of the adjuster’s estimate. Without a detailed estimate from the contractor, there is no way to compare with the adjuster’s estimate confidently. It is rarely wise to give the contractor the adjuster’s priced estimate. If anything, provide the contractor with the adjuster’s scope of loss without pricing. Adjusters commonly use computer programs for adjusting and can print or electronically transfer a scope to you.
Ask your adjuster to review and explain the estimate to you, in its entirety. This is often the best way to resolve errors and omissions with an adjuster. Most people would prefer to set their hair on fire than to do this. Still, it’s an excellent way to understand what is happening with your claim. It gives your adjuster another opportunity to proofread the estimate with a second set of eyes, and it allows you to provide input.
Ask your adjuster to arrange a meeting with the contractor. The adjuster cannot discuss the claim with anyone without your expressed permission, so having the contractor call the adjuster won’t work. In many cases, this meeting will resolve all differences.
Examine the estimate’s scope and unit-pricing. Differences can be in the scope of the damage to be repaired or in the price identified for a given amount of work. For instance, both parties might agree on the total quantity of roofing to be replaced but have different perspectives regarding the cost per square of roofing.
Inadequate scope. Including drywall repair without considering painting is an obvious example of an insufficient scope. While such is usually an inadvertent omission to be corrected, any deliberate omission would require an explanation by the adjuster.
Consider like kind and quality replacement. Your adjuster is estimating the loss; your contractor may have a different perspective. Staying with the roof example, your damaged existing roofing might be a 20-year 3-tab shingle, but you and your contractor want to replace it with a 30-year architectural shingle. The unit pricing is different, and the quantity is calculated differently.
Identify covered versus non-covered damage. While the adjuster’s estimate addresses damage covered by insurance, the contractor’s estimate may include additional items.
Look for limits and exclusions. Policies often limit coverage in specific circumstances. For instance, removing trees and tree debris may be covered up to a certain dollar amount (a Limit) or not at all, depending on what caused the tree to fall or what the tree damaged when it fell. The contractor’s estimate may include the full amount, whereas the adjuster’s estimate might only include the limited amount.
Losses in excess of coverage. Inexperienced adjusters sometimes make the mistake of only listing the covered amount on the estimate. If there is a loss in excess of coverage, that excess loss is still counted in determining the total amount of loss.
These are just a few of the items a claims examiner would consider in a review. Almost every estimate has errors and omissions; even experienced experts can miss what might seem obvious.
While resolving differences between an adjuster and contractor is outside of most people’s comfort zone, understanding the details from both parties can help you make the best of a bad situation.
Stay safe.
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