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.
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.
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.
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.
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.
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.
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:
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.
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.
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.
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.  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.
How the age of your roof impacts your home insurance rates
One benefit of replacing your bad roof is you'll typically be rewarded with lower home insurance premiums.
Here's how much you stand to save on your home insurance rates by replacing your roof:
Average annual cost with old roof
Average annual cost with new roof
Methodology: Annual rates are based on our analysis of home insurance premiums provided by Quadrant Information Services in March 2022 for ZIP codes in all 50 states plus Washington, D.C. Annual rates for old roofs are calculated by averaging the cost of policies for a roof that's 10 years old, 15 years old, and 20 years old with each carrier.
Frequently asked questions
What is considered an old roof?
Insurance companies generally consider a roof older than 15 years to be old. If you live in an area where roof damage from wind and hailstorms is common, like Florida or Texas, you may see higher home insurance rates or coverage restrictions like actual cash value protection.
How can I get insurance to pay for my roof replacement costs?
To get homeowners insurance to pay for a new roof, you'll first need to call your insurance company and see if the damage is covered by your policy and file a claim. Once you submit your claim, your insurance provider will likely send out an adjuster to inspect the roof damage and determine a proper valuation. In it's approved, your insurer will offer you a settlement amount and, if you're happy with the amount, you'll find a qualified roof contractor either through your insurance company or on your own.
Will homeowners insurance cover a 25-year-old roof?
Whether or not homeowners insurance will cover a 25-year-old roof or not likely depends on where you live and what kind of shape the roof is in. If your house is in a state with a fairly mild climate, like Idaho or Oregon, you'll likely have no problem finding an insurer to cover a roof with more than a couple decades under its belt. But if you live in a Southern U.S. state where tornado and hurricane risk is high, you may have a more difficult time finding coverage with a standard provider.