Hello, and welcome to Discover NC Homes and Nolan’s News. This is Nolan Formalarie and I have Kara Herring with me today and we will talk about the age and type of roof and their effect on insurance premiums.

Nolan
Kara, thank you for joining us. Kara is with Don Bullard Insurance (https://www.donbullard.com/), she’s the president and has an office down here in Southport and two in Wilmington. And she’s here today to talk to us about roofs and the various guidelines that are tightening up. I know from selling real estate, we’ve had a few companies that have dropped the policy because the age of the roof, or have said: “we’re going to charge a whole lot more than we used to because of the age or the roof.” So can you fill us in on some of what has changed?

Kara
Well, you’re right. The guidelines in our coastal market are definitely tightening up, so you want to be cognizant of that when you’re buying a new home, perhaps rewriting a policy to a new company. It’s going to depend on the company, their particular guidelines, but you always want a newer roof.

You want a newer roof! If it’s 15 years and younger, that’s great. If it’s even more than that, that’s much better. So as a buyer, you want to find out about that roof, cause insurance carrier is going to ask.

If you get into typically around a 20 year roof, it’s tough. Not that you can’t get it. Architectural shingle roof is better than a composite shingle roof. Metal is good too.

Nolan
What is the difference between those two, the architectural and the composite shingle roofs?

Kara
Mostly you’re going to see architectural, composite is a little flatter. But you can see on the tax records, it’ll say “composite” or “architectural”.

Nolan
Is that we’re you guys look?

Kara
Yes, we do. We look at the tax records to get tons of information. So if somebody calls for a quote, I’m automatically pulling up the tax records, I’m looking at heated square footage. I’m looking at year bills, I’m looking at how big the garage is, I’m asking: “does it have a hip roof?” If it has a hip roof, you can get some wind mitigation credits. So, a number of things.

The roof is a biggie, especially right now. If you can get a newer roof, even if the home… and you may think: “okay, well, the home was built in 2005, surely it’s the original roof.” But not so! We’ve had a number of storms. We’ve had hailstorms where somebody could have had a new roof replacement, and we’ve had tornadoes, not particularly here, but we’ve had the scares. A little bit further south we’ve seen the tornadoes!

So always a good question, as you’re listing a home, to ask that, because that’s going to give you some really good credits, if you tell me: “okay, this house was built in 2005, but the roof was put on in 2019.” I’m going: “Great! That’s great!”

Now, again, not that we won’t be able to place it with a company or an independent agent. We’ve got a ton of companies that we can write with. But our markets open up with that newer roof.

Other things that might be changing right now, depending on the company, it’s going to be that wind and hail or named storm deductibles. Some of the companies are going to go from that 1% to a 2% deductible. And you’re going to see that in Florida. That’s the norm, the 2% is the norm on the coast.

Nolan
So if it’s a named storm, it’s going to be more expensive?

Kara
It could be! Some companies, again, are looking to lessen their risks. So they may do an amendment to your policy. So you may see that it’s going from a 1% deductible to a 2% of that. Now there are other companies that may offer that 1%. So then maybe you want to look at shopping that around

Another thing with some companies, going back to the age of the roof, they may still write it if it’s an older roof, but they may do what’s called ACV, which is going to be Actual Cash Value. So, in the event of a claim, they’re going to pay a depreciated value. So they’re going to replace, let’s say, that 15 year old roof versus replacement value, which most policies have on them – what it actually costs to replace it.

Nolan
So it could be substantial.

Kara
These are things to be looking for and things that may possibly be changing with certain companies.

Nolan
As we’re insured with you, do you let the end user know, like if that policy change is happening, you would let me know?

Kara
Absolutely. So, the carrier, so the actual company that you’re written with, does have to send you notification of that. So you would see that in your renewals. So don’t just get that and go: “oh, well my mortgage company is escrowed so I won’t even look at it.” Look at it! Cause it’ll say in bold print, if there’s any changes.

Now, also, your agent should let you know as well. We make sure that we let everybody know, especially in cases like that, where your deductible is changing significantly, or you’re going from the replacement value to the actual cash value – I would want to know that!

Nolan
Me too!

Kara
I feel like we’re liable, as the agent, to let you know that, too. So, you should get something from the actual company and then something from your agent. At least that’s our position.

Nolan
Okay. Well, very enlightening because, again, there’ve been a lot of changes that have been made. Well, thank you Kara, I appreciate it. Thank you for coming.

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About Nolan Formalarie

Nolan Formalarie has been in the North Carolina Real Estate Industry for over 8 years and enjoys every minute of it. He is involved in every aspect of the industry including selling and purchasing residential property, home watch services, property management, association management and construction.