How to Read Your Adjuster's Estimate

You have a document from the insurance adjuster and a number that feels lower than you expected. Before deciding whether to accept it, request a supplement, or push back, you need to understand what the estimate actually says. This guide walks through the structure, explains where the net payable comes from, and identifies the line items worth checking - including a section on when the estimate looks reasonable.

By Awais Khadim Last updated:

1. The structure of an adjuster's estimate

An adjuster's estimate is a line-by-line document. Each row represents one component of the repair scope. Reading left to right across a typical row:

Description
Qty / Unit
Unit cost
RCV
Depreciation
ACV
Remove & replace shingles
see estimate
see estimate
qty × unit cost
withheld
RCV − dep

What each column means:

  • Description - the specific item of work, e.g. "Remove and replace architectural asphalt shingles" or "Install drip edge."
  • Quantity / Unit - how much of the item. Roofing quantities are typically measured in squares - one square equals 100 square feet of roof surface. Other items may be measured in linear feet (LF), each (EA), or hours (HR).
  • Unit cost - the adjuster's price per unit. This comes from a pricing database the carrier uses and may differ from what a local contractor would charge. Regional variation in pricing is normal.
  • RCV (Replacement Cost Value) - quantity multiplied by unit cost. What the item costs to replace today with new materials, per the adjuster's pricing.
  • Depreciation - the amount withheld from that line based on the roof's age and condition. Applied line by line, not as a single percentage of the total. The method and rate vary by carrier and policy.
  • ACV (Actual Cash Value) - RCV minus depreciation. The amount the carrier pays for that item upfront, whether you have an ACV policy or the initial payment under an RCV policy.

At the bottom of the estimate, these columns total up, and then two more lines appear:

  • Deductible - subtracted from the ACV total, not from the RCV total.
  • Net payable (also called "net claim," "amount due," or "net ACV") - the check the carrier issues. ACV total minus deductible.

Abbreviations you'll see: SQ, SF, LF, R&R, D&R

Line items use short codes for units and for the kind of work being priced. Knowing them lets you check each quantity against your own measurements:

  • SQ - square: 100 square feet of roof surface, the usual unit for shingles and tear-off.
  • SF - square feet, used for smaller areas such as decking or interior drywall.
  • LF - linear feet, used for edges and runs such as drip edge, ridge cap, and flashing.
  • R&R - remove and replace: the old item comes off and a new one goes on.
  • D&R - detach and reset: the existing item is taken off and put back, such as a vent or satellite dish moved for the roofers.

2. Why the net payable is lower than the estimate total

This is the most common source of confusion. The number at the top of the estimate - the RCV total - is not what you receive. Two deductions bring it down to the net payable:

  1. Depreciation is withheld. Every line item is reduced from its RCV value to its ACV value before the totals are summed. On an older roof, this reduction can be substantial.
  2. Your deductible is subtracted from the ACV total. Not from the RCV total, not from the repair cost - from the ACV total after depreciation.

On an RCV policy, the withheld depreciation is not gone - it is recoverable after you complete repairs and submit invoices. The estimate typically shows this as a separate "recoverable depreciation" line. On an ACV policy, depreciation is permanent: the net payable is the only check.

If the estimate total surprised you, compare the RCV total, the ACV total, the deduction for depreciation, and the deductible line separately. That four-number breakdown usually shows exactly where the gap came from.

The calculator on this site runs these same four numbers from your inputs and shows the breakdown explicitly - replacement cost, depreciation, ACV, deductible, first cheque, and withheld depreciation.

3. Line items worth checking for

Adjusters work from what they can observe and measure. Items that are not visible, not yet priced, or that require specific local knowledge are sometimes omitted from a first estimate - not necessarily because the carrier is wrong, but because the scope was incomplete when the estimate was written. Check whether each of the following appears on your estimate before concluding something is missing:

  • Tear-off and disposal - removing the existing shingles and disposing of the debris. Should appear as a separate line item, not bundled into the shingle replacement price. If it's missing, ask whether it's included in another line.
  • Underlayment - the layer of felt or synthetic material installed beneath the shingles. Replaced whenever shingles are replaced; should appear on the estimate.
  • Drip edge - the metal strip installed at the roof perimeter to direct water into the gutter. Many local codes require it; check whether it appears.
  • Flashing - metal seals at penetrations (chimneys, vents, skylights) and intersections (valleys, wall abutments). If the damaged area includes these features, flashing should be on the estimate.
  • Ridge cap and starter strip - the shingles that cap the ridge line and the starter row at the eaves. These are separate materials from field shingles.
  • Permit fees - many jurisdictions require a permit for a full roof replacement. If your local jurisdiction does, the fee should appear. Whether it is covered depends on your policy.
  • Steep-slope or multi-story access charges - roofs above a certain pitch or height require different staging and safety equipment, which some carriers price separately. If your roof is steep or the house is multi-story, verify whether an access charge appears.

Not every item above belongs on every estimate. A repair to one section of a flat roof may not need ridge cap. A single-story house with standard pitch may carry no access charge. Check whether an item applies to your specific scope before treating its absence as an error.

4. Overhead and profit (O&P)

Overhead and profit (O&P) is a line item - sometimes a percentage applied to the total - that accounts for a general contractor's operating costs and profit margin above the direct cost of materials and labor. It is not the same as the profit built into individual unit prices.

Whether O&P appears on an adjuster's estimate depends on the carrier, the policy, and the complexity of the job. On a straightforward shingle replacement done by a single roofing subcontractor, some carriers do not include it. On a more complex job requiring a general contractor to coordinate multiple trades, some carriers do. The treatment varies, and no single percentage is standard across the industry.

If a contractor's bid includes O&P and the adjuster's estimate does not, that difference is a common reason to submit a supplement (see section 6). The supplement request should document why the job's scope requires general contractor coordination.

5. Code upgrades (ordinance or law coverage)

Building codes change. When a storm forces a roof replacement, the work must meet current code requirements - which may include materials or methods that did not exist when the original roof was built.

A standard homeowners policy typically pays to restore the roof to its prior condition, not to bring it up to current code. The cost of any code-required upgrades beyond that - different decking, additional ventilation, specific flashing methods - is often excluded from the base policy.

Coverage for code-upgrade costs is usually found in an ordinance or law endorsement, sometimes labeled "Building Ordinance" or "Code Upgrade" coverage. Whether your policy includes this endorsement, and what it covers, is on your declarations page and attached endorsements. If it's absent, code-required upgrades come out of pocket.

6. If something is genuinely missing: the supplement process

A supplement is a formal request to add line items or revise quantities in an existing estimate. Supplementing a claim is a normal, routine part of the claims process - not an accusation, and not a dispute. Carriers have processes for receiving and reviewing supplements.

If you believe an item is missing from your estimate, the process is:

  1. Document the gap. Identify the specific line item, get a contractor estimate or invoice that shows the item and its cost, and collect photos or measurements that support the scope.
  2. Contact your adjuster or carrier. Submit the documentation to the adjuster handling your claim, or use the carrier's supplement submission process. Ask for confirmation that it was received.
  3. Follow up in writing. If you do not receive a response within the carrier's stated timeframe, follow up in writing and keep a record of the exchange. State prompt payment laws, where they exist, set deadlines for how quickly a carrier must respond to a claim communication - check the rules for your state on thestate-specific pages.

A supplement that adds legitimate items should result in a revised estimate and an additional payment. A supplement that is rejected should come with a written explanation of why.

If you have submitted a supplement and the dispute remains unresolved on a claim you believe is substantially underpaid, you may be weighing whether professional representation makes sense. Before paying anyone a percentage of your settlement, read Do you need a public adjuster? - including the section on when the math doesn't support hiring one.

7. When the estimate is probably accurate

Not every estimate that feels low is wrong. Before concluding there is a problem, check whether the following are true of your estimate:

  • The scope covers the full damaged area. The quantity in squares matches the section of roof that was damaged. If you had a partial loss, a partial estimate is correct.
  • Standard components appear. Tear-off, underlayment, ridge, and starter are on the estimate for the affected area. Flashing appears where relevant.
  • Depreciation tracks the roof's age. An older roof will show significant depreciation - that is not an error. If the roof is 15 years old and the depreciation is substantial, that reflects the age of the material, not a mistake in the estimate.
  • The deductible accounts for the gap. If the estimate total looks close to what a contractor quoted but the net payable is much lower, check the deductible and depreciation lines first. The gap is often entirely explained by those two deductions, which are correct charges.
  • The gap between the estimate and a contractor's bid reflects scope differences. Contractors and adjusters use different pricing sources. A contractor's bid may include O&P, sales tax, or job-specific access costs that are not yet on the estimate. That does not automatically mean the estimate is wrong - it may mean those items need to be supplemented with documentation.
If the scope is complete, the components are present, and the gap is explained by depreciation and your deductible, the estimate is likely accurate. Accepting an accurate estimate and proceeding with repairs is the right outcome.