How to get homeowners insurance with a bad roof

Coverage options are available for homes with bad roofs — but it usually comes at a cost.

Pat Howard 1600

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Pat Howard

Pat Howard

Senior Editor & Licensed Home Insurance Expert

Pat Howard is a senior editor and licensed home insurance agent at Policygenius, where he specializes in homeowners insurance. His work and expertise has been featured in MarketWatch, Real Simple, Fox Business, VentureBeat, This Old House, Investopedia, Fatherly, Lifehacker, Better Homes & Garden, Property Casualty 360, and elsewhere.

Updated  | 3 min read

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One of the toughest parts about owning a home is knowing when to replace your roof. A few missing shingles may not seem like a big deal to you, but your homeowners insurance company may see this as a red flag. 

The reason for this is your roof — along with your home’s systems and foundation — is what keeps your house intact. Once your roof starts showing signs of deterioration, that’s a telltale sign to insurers that it’s only a matter of time before it goes kaput. 

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However, there are insurance companies that specialize in insuring homes with high-risk features, including older or damaged roofs. In this guide, we’ll explain how to get homeowners insurance with a bad roof.

Key Takeaways

  • If your homeowners insurance was canceled because of your roof’s condition, don’t panic — you can likely find coverage elsewhere.

  • Although there are insurance options for homes with bad roofs, the coverage itself is generally worse and more expensive.

  • Repairing or replacing your roof can lower your home insurance rates and provide better coverage against the unexpected.

Can you get homeowners insurance with a bad roof?

Yes. In fact, it’s possible to get homeowners insurance with a bad roof even after you’ve been denied coverage. Some insurance companies actually specialize in insuring homes with bad roofs or other risks that standard insurers won’t touch.

But high-risk homeowners insurance can cost a pretty penny. Additionally, coverage is typically only provided on an actual cash value basis. That means if your 20-year-old roof is damaged in a windstorm, you’ll be reimbursed for the roof’s replacement value minus 20 years of depreciation.

But if you need temporary coverage while you save for a new roof, or if you’re selling your property and don’t want to put any more money into it, getting coverage through a high-risk insurance company is a suitable option.

Roof requirements for homeowners insurance

Insurance companies place a lot of importance on roof condition when determining a home’s coverage eligibility and rates. Generally, there are four key factors insurers look at.

Roof age

If your home has a newer roof, you’ll likely see lower rates — maybe even a policy discount. If your roof is more than 15 or 20 years old, coverage will likely cost more and your insurer may only agree to cover the roof at its actual cash value.  

Roof condition

The better condition your roof is in, the less you’ll have to pay for homeowners insurance. Insurance companies are more likely to overlook your roof’s old age if it’s in pristine condition or has no visible sign of wear and tear.

Roof type

Insurers will also consider what your roof is made of. Metal roofs are the most structurally sound, so they’re usually the cheapest to insure. Conversely, wooden roofs are viewed as an insurance risk since they’re not fire resistant. Insurance companies in areas with high fire risk may refuse to insure homes with wooden roofs.

Roof shape

Your roof’s shape can also impact your rates. Gable roofs (upside down V shape) and hip roofs (four-sided) are the most common shapes. Gables are generally more at risk of wind damage, so they generally cost more to insure than hip. Homes with flat roofs are usually the most expensive to insure.

How actual cash value roof replacement is calculated

To figure out your roof’s actual cash value (ACV), you first need to find out how much it has depreciated. Lets say you paid $7,000 for a new roof in 2001 — to calculate depreciation, you’ll need to do the following:

  1. Find its lifespan: This is the number of years your roof is determined to hold value. Let’s say your roof has a 25 year lifespan. 

  2. Find its replacement cost: Replacement cost is the amount a similar roof would cost at today’s prices. So a $7,000 roof in 2001 might have a replacement cost of, say, $10,000 today. 

  3. Do a little math: Depreciation is replacement cost x the percentage of lifespan used. If your roof is 20 years into its 25 year lifespan, then its depreciation would be $8,000 (10,000 x 0.8 = 8,000)

Actual cash value is replacement cost minus depreciation, so your roof's ACV would be $2,000 (10,000 - 8,000 = 2,000). In the event of a roof damage claim, that's the maximum amount your insurance will pay out.

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What to do if your insurance is canceled because of your roof

If you receive a policy cancellation notice, you’ll have around 60 days to replace your roof or find a new home insurance policy. 

Provided that your roof isn’t badly damaged, you’ll likely be able find a company to insure your home. But ultimately, you’ll have to weigh the costs and benefits of keeping the roof as is and paying higher rates versus investing in a new roof and paying lower rates.

But if you don’t get a new roof, you face having to pay significantly higher rates with a company that is willing to take on that risk. Roof replacement also lessens the chance of further damage to your home down the road.

How much does it cost to replace a roof?

The average cost of roof replacement is around $8,500, with a range of anywhere from $5,500 to $11,664, according to Home Advisor. [1] But costs will vary widely depending on the cost of materials and labor in your area. 

For example, basic builders-grade asphalt shingles may only cost around $3 per square foot, whereas higher-quality composite shingles are known to cost as much as $15 per square foot installed. 

There are a number of other factors that impact roof installation costs, including:

  • How easy it is to access to your roof

  • Your home’s condition

  • Cost of permits and licenses

  • Whether you’re replacing or re-roofing, or placing new shingles over old ones. Re-roofing is generally the cheaper option. 

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