ACV-Only Roof Endorsement: What Contractors Need to Know (and How to Sell Anyway)

A homeowner calls you about their hail claim. They're excited because the adjuster approved a full replacement. Then they read you the settlement numbers and something doesn't add up. Replacement cost 16,400 dollars, depreciation holdback 9,800 dollars, deductible 2,000 dollars, net check 4,600 dollars. When you ask about the second check for recoverable depreciation, the homeowner says the adjuster told them there isn't one. That depreciation is gone. Permanent.

Welcome to the world of ACV-only roof endorsements. Over the last five years, every major carrier has rolled out some version of a roof surfacing schedule, a wind and hail exclusion, or a cosmetic-only endorsement that strips replacement cost coverage off older roofs. Homeowners sign the renewal paperwork without reading it. Then a storm hits and the math collapses.

If you sell roofs for a living, this is the single biggest shift in insurance claim economics in a decade. Understanding these endorsements, identifying them before you quote, and selling a homeowner through the ACV gap is now a core contracting skill. This guide breaks down which carriers use them, how to spot them on the declarations page, and what to do when your homeowner is holding a check that's half of what they actually need.

Why ACV-Only Roof Endorsements Are Spreading So Fast

To understand why you keep seeing these endorsements on claims today, you have to understand what happened to property insurance carriers over the last decade. Roof claims exploded. Material prices tripled. Hail losses in the Texas, Oklahoma, Colorado, and Midwest corridor rewrote actuarial tables. Carriers either priced themselves out of the market, pulled out of entire states, or looked for a structural fix.

The structural fix was the roof endorsement.

Instead of paying replacement cost on 20-year-old asphalt shingles that failed the next hail season, carriers started restricting coverage based on roof age, roof material, and type of damage. The endorsement lets the insurer keep writing the policy at a competitive premium while cutting their tail risk on aging roofs. From the carrier's perspective, it's sustainable. From your homeowner's perspective, it's a financial grenade they didn't see coming.

Three Flavors of Restriction

Not all roof endorsements do the same thing. They fall into three broad categories:

• Roof Surfacing Schedule or Roof Payment Schedule: Pays a declining percentage of replacement cost based on roof age. A 15-year-old roof might pay 60 percent of RCV. A 20-year-old roof might pay 40 percent.
• ACV Roof Loss Settlement Endorsement: Strips RCV entirely off the roof. The carrier pays actual cash value only, regardless of the rest of the dwelling's coverage.
• Cosmetic Damage Exclusion: Denies coverage for damage the carrier classifies as cosmetic (dents in metal, granule loss without functional failure). We cover this in more detail in our cosmetic-only hail denial guide.

These endorsements can stack. A policy can have an ACV roof endorsement plus a cosmetic exclusion plus a separate wind and hail deductible. Each layer reduces what the homeowner actually collects.

Which Carriers Use Them and What They Call Them

Every major carrier has some version of this endorsement. The names are different but the mechanics are similar. Here's a reference table of the most common ones you'll see on claims today.

The exact form number varies by state and filing year. Don't memorize the names. Memorize the shape: if the declarations page mentions "roof," "surfacing," "schedule," "limited," "payment," or "ACV" in the endorsements section, assume restricted coverage until you confirm otherwise.

State-by-State Variation

Carriers can only use what their state department of insurance approves. Texas, Colorado, Oklahoma, Kansas, Missouri, and Minnesota are heavily saturated with these endorsements because of hail frequency. Florida uses them heavily for wind. California and other low-hail states see them less often but they're spreading. If you're working claims in hail alley, assume every policy has some form of restriction until proven otherwise.

How to Identify the Endorsement on the Declarations Page

The declarations page (dec page) is the two to four page summary of the policy. It lists coverages, limits, deductibles, and endorsements by form number. Before you sign a contract, before you write a proposal, before you quote a scope, get the dec page. Here's how to read it.

Step 1: Find the Endorsements Section

Usually on page 2 or 3. Look for a header like "Endorsements," "Forms and Endorsements," "Policy Forms," or "Additional Coverages." You'll see a list of form numbers (like HO-04-93 or FP-7955) with short descriptive names.

Step 2: Scan for Roof Keywords

You're looking for any form that includes words like Roof, Surfacing, Surface, Schedule, Limited Loss, Actual Cash Value, Payment Schedule, or Cosmetic. If you see any of these, you have a restricted roof endorsement. Ask the homeowner to request the actual endorsement language from their agent so you can confirm what it does.

Step 3: Check the Dwelling Coverage Line

On Coverage A (Dwelling), look for language like "Replacement Cost" or "RC" or "RCV." Then check whether there's a note that says something like "Excluding Roof Surfacing" or "See Endorsement." This is a tell. The dwelling has RCV coverage but the roof is carved out.

Step 4: Check for Separate Wind/Hail Deductibles

Many policies with ACV roof endorsements also have separate wind and hail deductibles that are percentage-based (1 percent, 2 percent, 5 percent of Coverage A) rather than flat-dollar. A 300,000 dollar home with a 2 percent wind/hail deductible has a 6,000 dollar deductible on roof claims. Combined with ACV-only coverage, that can be devastating.

Red flag combination to watch for:

Coverage A: Replacement Cost (Excluding Roof Surfacing)
Endorsement: Roof Surfacing Payment Schedule
Wind/Hail Deductible: 2 percent of Coverage A
Roof Age: 14 years

On a 350,000 dollar home this homeowner is looking at a 7,000 dollar deductible, a roof paying at roughly 50 percent of RCV, and zero recoverable depreciation. Their 18,000 dollar roof claim nets them around 2,000 dollars.

If you can read a dec page in 90 seconds and identify this combination, you will set better expectations than 95 percent of contractors in your market. For a full walkthrough on reading estimates and policy documents, see our adjuster estimate review checklist.

Roof Age Triggers and Trigger Events

Most ACV-only roof endorsements don't kick in immediately. They have a trigger: either an age threshold, a material type, or a peril-specific activation.

Age-Based Triggers

Common thresholds:

• 10 years: Aggressive carriers in hail-heavy states; some State Farm and Farmers policies
• 15 years: Most common threshold across Allstate, Travelers, Liberty Mutual
• 20 years: Typical for USAA, Nationwide, and more generous policies
• 25+ years: Rare, usually associated with premium policies or specific material types

The age is measured from installation date, not from policy inception. This is important. If the homeowner inherited a 12-year-old roof when they bought the house three years ago, the roof is 15 years old for endorsement purposes.

Material-Based Triggers

Some endorsements apply only to composition asphalt shingles. Tile, metal, slate, and synthetic roofing are sometimes exempt or have different schedules. Check the endorsement language. Carriers rate material risk differently.

Peril-Based Triggers

The Travelers Windstorm or Hail Loss to Roof Surfacing endorsement is a good example. RCV still applies for fire, falling objects, or other perils, but wind and hail claims are settled at ACV. This matters for cause-of-loss determination. If you can tie damage to a non-wind peril, coverage may improve. See our wind vs. hail cause-of-loss guide for the nuances.

The ACV Gap: What the Homeowner Is Actually Facing

The ACV gap is the dollar amount between what the insurance pays and what the actual replacement costs. On an RCV policy, that gap is theoretically zero (minus deductible). On an ACV-only policy, the gap can be 40 to 70 percent of the total job cost. Let's run the math.

Example: 15-Year-Old Architectural Shingle Roof

Same roof, same storm, same damage. The RCV homeowner covers their deductible and gets a new roof. The ACV-only homeowner is staring at a 14,200 dollar gap between the insurance check and the cost of the job. That's the conversation you're walking into.

If you want to understand the underlying mechanics of how depreciation withholding and recovery normally work on RCV policies, our ACV vs. RCV breakdown and recoverable depreciation guide cover the process end to end.

Selling Through the Gap: Financing, Phased Repair, Scope Options

An ACV-only claim isn't a lost deal. It's a different deal. The homeowner still needs a roof. The question is how they pay for it. Your job is to present real options without pressure.

Option 1: Financing

Most established roofing companies have at least one financing partner. Zero-percent intro promotions, 12-month same-as-cash plans, and longer-term amortized loans are all viable. For an ACV-only homeowner who has 2,200 dollars of insurance money and needs 14,000 more, a 10-year financing plan at a manageable monthly payment often solves the problem without depleting savings.

Be transparent about interest, term, and total cost. Homeowners who feel rushed into financing call back three weeks later to cancel. Homeowners who feel educated sign and refer their neighbors.

Option 2: Phased Repair

If full replacement isn't financially viable right now, phased repair is a conversation worth having. Is there a slope that took the brunt of the damage and needs to go first? Can the carrier approve a repair-only scope for the worst section while the homeowner saves for full replacement next year? This won't work on every claim, but it buys the homeowner time and keeps the roof functional.

Document everything carefully during the repair so the homeowner isn't accused of pre-existing damage on the next claim.

Option 3: Material Downgrade or Upgrade Evaluation

Some homeowners hear ACV-only and assume they should downgrade to three-tab shingles to hit the insurance check number. That's usually the wrong move. Three-tab shingles carry shorter warranties, weather worse, and will age into the same endorsement trap faster.

Run the actual numbers. A 30-year architectural shingle with impact-resistant rating may qualify the homeowner for a premium discount on renewal that partially offsets the upgrade cost. Impact-resistant shingles also strengthen the position against future cosmetic-only denials. This is a relationship investment, not a one-transaction decision.

Option 4: Insurance Re-Review

Before assuming the ACV endorsement is rock-solid, make sure the adjuster applied it correctly. We've seen claims where the adjuster applied the ACV schedule to a roof that didn't actually meet the age threshold, or applied a cosmetic exclusion to functional damage. Request the endorsement language in writing. Verify the roof age. Verify the cause of loss. If the adjuster got it wrong, the claim can be reopened.

Why Supplements Still Matter on ACV-Only Claims

Contractors sometimes assume that if a claim is ACV-only there's no point in supplementing. That's wrong. Supplements still put real dollars in the homeowner's pocket. The mechanics are just different.

Supplements Increase the ACV Base

Remember the formula. ACV equals RCV minus depreciation. When you supplement the RCV by adding missed line items, increasing quantities, or correcting underpriced materials, the ACV also increases. The depreciation percentage stays the same, but the base it's applied to is now larger.

Before supplement (ACV-only claim):
RCV: $16,400 | Depreciation (50%): $8,200 | ACV: $8,200

After 3,200 dollar supplement is approved:
RCV: $19,600 | Depreciation (50%): $9,800 | ACV: $9,800

Net additional dollars to homeowner: 1,600 dollars

Not as powerful as a supplement on an RCV claim, but 1,600 dollars is still 1,600 dollars. Multiply that across a season and it's real money. Homeowners don't forget contractors who fight for them on claims other contractors walk away from.

What to Look for on ACV-Only Supplements

• Missing tear-off layers: Adjusters often estimate one layer of tear-off when there are two or three.
• Code upgrade items: Ice and water shield per current code, drip edge, ridge vent upgrades. Some carriers cover code items even on ACV claims through Ordinance or Law coverage.
• Accessory items: Step flashing, pipe jacks, roof-to-wall flashing, chimney flashing kits.
• Labor and material pricing corrections: Outdated Xactimate pricing that hasn't caught up to current market.
• Detach and reset items: Solar panels, satellite dishes, gutters where applicable.

Our supplement walkthrough covers the full process for building and submitting winning supplements, and the techniques apply to both ACV and RCV claims.

Ordinance or Law Coverage Is Your Hidden Lever

On many ACV-only roof claims, the dwelling still has Ordinance or Law coverage for code-required upgrades. Ice and water shield to the code required distance, synthetic underlayment upgrade if code requires it, and decking replacement if non-compliant sheathing is found can all be billed against Ordinance or Law coverage rather than against the roof endorsement. This is one of the most overlooked tactics for rescuing an ACV-only claim economically.

Helping Homeowners Avoid the Trap on Next Year's Renewal

This is relationship gold. A homeowner who just got burned by an ACV-only endorsement is the most receptive audience in the world to hearing about how to avoid the same outcome next year. You become the trusted advisor instead of just the contractor who fixed the roof.

Review the Next Renewal Together

Offer to look at their declarations page when their next renewal arrives. A 15-minute review can identify whether the endorsement is still on the policy, whether moving to a different carrier would restore RCV coverage, and whether the homeowner qualifies for discounts based on the new impact-resistant materials you just installed.

Document Impact-Resistant Installation

If you installed Class 4 impact-resistant shingles, give the homeowner the manufacturer certification paperwork and a copy of the invoice with the IR rating documented. Many carriers offer premium discounts for IR shingles and some will restore RCV coverage on the roof as a result. The homeowner needs this paperwork to request the discount.

Talk About Carrier Shopping

You don't sell insurance. But you can tell a homeowner that not every carrier uses the same restrictions, and that working with an independent agent who writes with multiple carriers can sometimes turn up a policy with full RCV roof coverage even in hail-prone territory. Plant the seed. The homeowner does the legwork.

Common Mistakes Contractors Make with ACV-Only Claims

These are the errors that cost deals, damage reputations, and leave money on the table.

Mistake 1: Assuming Every Policy Is RCV

Don't quote a job assuming the homeowner will have RCV coverage. Always ask for the dec page before writing a contract. If you're 72 hours into a signed contract and only then discover the policy is ACV-only, you have a painful conversation ahead.

Mistake 2: Not Reading the Endorsement Before Quoting

The dec page tells you the endorsement exists. The actual endorsement language tells you what it does. Request it. Read it. Some endorsements have carve-outs (hail excluded but wind included, or vice versa) that change the economics dramatically.

Mistake 3: Walking Away Too Fast

An ACV-only claim looks ugly on paper. Some contractors quote it, lose interest, and move on. The homeowner still needs a roof. If you're willing to walk them through financing, phased options, and supplement opportunities, you can close a job that three of your competitors abandoned.

Mistake 4: Giving Up on Supplements

Don't stop supplementing just because the claim is ACV-only. Every dollar added to RCV adds partial dollars to ACV. Combined with Ordinance or Law items, a solid supplement can pull thousands of dollars back into a claim that looked hopeless.

Mistake 5: Not Checking for Misapplied Endorsements

Adjusters are human. They misapply endorsements. They use the wrong age. They apply a cosmetic exclusion to functional damage. Always verify the endorsement was applied correctly. If it wasn't, the claim is rewriteable.

Mistake 6: Selling Lower-Grade Materials to Fit the Budget

When a homeowner has a 2,200 dollar insurance check and a 14,000 dollar job, the temptation is to downgrade materials to shrink the gap. This usually hurts the homeowner long term. Aging three-tab shingles into the next hail season just puts them back in the same trap. Run the numbers on financing instead and let the homeowner make an informed choice.

Mistake 7: Not Documenting for Future Claims

When you install the new roof, document the installation thoroughly. Material batch numbers, photos of each stage, the impact-resistant rating on the shingles, Ice and water shield coverage. The homeowner may need this documentation in two years when a different adjuster tries to argue wear and tear on brand new materials. Our hail damage claims guide and wind damage claims guide go deeper on documentation standards for future-proofing.

Putting It All Together: The ACV-Only Workflow

Here's the end-to-end playbook when you encounter an ACV-only roof claim:

1. Get the dec page before anything else. Identify the endorsement, the deductible structure, and the age triggers.
2. Request the endorsement language in writing. Verify exactly what it restricts.
3. Verify the adjuster applied it correctly. Check the roof age, the material, and the cause of loss.
4. Run the real numbers with the homeowner. Show the gap honestly. Don't paper over it.
5. Supplement the RCV anyway. Every dollar added helps. Look for Ordinance or Law items as a separate bucket.
6. Present options without pressure. Financing, phased repair, material evaluation.
7. Document installation thoroughly. Protect the homeowner against future underpayment arguments.
8. Offer renewal review. Help them avoid the same outcome next year.

The ACV-only roof endorsement is here to stay. Carriers are adding them faster, not slower. Contractors who understand the mechanics and can guide homeowners through the reality will win more deals, build better relationships, and earn referrals from every homeowner who felt abandoned by the insurance company.

For tools that help you identify supplement opportunities and organize claim documentation across both RCV and ACV claims, explore ClaimStack. The platform analyzes adjuster estimates against Xactimate pricing data so you can find what's missing, build supplements faster, and help your homeowners stretch every insurance dollar as far as it will go.