Let me beat a dead horse.....again!

Well guys.....what would you think if you were on a roof giving an estimate, in your home town...and not 1 but 2 different stormchasers stop and try getting the job......with me on the roof!!

Keep in mind they were both national stormchasers....and they already have signs everywhere!

How would you react?

More to come.....but first I want to know what you would think if this happened to you?

Thanks!

:woohoo:

minnesotaroofin Said: so now no one ever has to pay for a new roof or siding they get old enough a hard rain / wind will damage the shingle.

That's quite a reach.

minnesotaroofin Said:

As far as the 24% profit i would be happy if i made that every job -

And your last statement -- i dont care what anyone says about hail if it does not break a glass car or truck window it will not drasticly reduce the life of the shingle -- I have one house in my neighborhood that has the original roof of 22 years on it it does show signs of curling etc

I don't know if you responding to my post or someone elses. I didn't say I made a 24% profit. I'd be tickled pink if I could make a true 24% profit on any job. I said I made a 24% gross markup. After cutting out overhead and other soft expenses, that doesn't leave enough for me to get excited. I might do one of these but if I start getting a run on them, I'm in trouble.

As far as your expertise regarding roofs that have been hit by hail....how would you explain the north side of the house looking significantly older and beat up than the south side? There were no specific hits that were evident to the eye? Yet, there were patches of black asphalt appearing everywhere.

I just left a roof yesterday and they told me that every time it rains, their driveway is now covered with grit from the roof. Is it possible that the lady with 22 year old shingles has a roof that is more suitable to be hailed on? Wouldn't some products hold their granules better?

I don't know the answers...I just think the insurance companies should be paying for these roofs if they aren't going to last their 20 years because of hail. I believe the hail is reducing their shelf life. What else would explain the vast difference between two sides of the same house?

Minnesota---my question is.... Why were there exposed fasteners in the first place? Exposed nail heads = potential leaks. I would have held payment until the shingles were replaced and there were no exposed heads. If there were a problem with the shingles down the road, the manufacturer warranty would be void for workmanship reasons.

minnesotaroofin Said: Jim, I dont think there is any way to legitmize a storm job / Claim -- first of all 90% of roofs or better have at leat 5 years or better life left on them or are in need of replacement to begin with - so that leaves insurance companies footing the bill for good roofs with life left on them or taking over homeowner responsibility and spreading their irresponsibility on us all. which in returns costs all of us more.

Second Knowing what i know about insurance and adjusting that you can have American family for one barely covers cost of the job - or state farm with 25 - 30% profit margin -- to Liberty mutual 50% plus profit margins for the contractor all using xactimate the same program. What kinda a scam is happening? Differnt banks backing them where is the economy and why is it where it is? because the banks took the responsibility and f ed it up.

Third knowing this where is your estimate dollar wise? and why you truly dont like to give your number out before hand is because you will leave money on the table. Furthermore what incentive do you have to actually bill the insurance company a lower number than they are willing to pay. I will not say you do not and bill them for just what you need vs upgrading and throwing in extras at everyone elses expense just cause the insurance company is willing to pay more for a job you can do for less espesially if they are paying a 25 year and you are installing a 30 year you could bill them for less and save them some money which inturn saves us all some money. But then again i do not know you well enough to say you dont. I can tell you that i do - but as the business goes i do not all the time sometimes i am pressured to throw in the 30 year if my estimate is lower. This is why it is not legitimate because those of us that see the whole picture cannot feel good about selling an insurance job knowing they are paying for something they should not be and billing it in our premiums.

I'm not understanding why you think there is something wrong with the current method of each insurance company creating their own method of paying off claims. This is America, the home of captialism, where every company is free to create their own business system. They then take their programs to the public and sell, sell, sell. Yes, some companies will be easier to work with, from the contractor's point of view. Some homeowners will think their insurance company was better. Variety is the spice of life.

Can an insurance company really know how much I need to make a living and a profit? Not really. They give their "estimates" and we offer our services at whatever price we want. Their insurance report is nothing more than their estimate of what it will cost but in reality, they have based their numbers on an average of available materials and labor. In theory, no one will match their estimates.

As for me, I can figure out what I want to charge without the insurance companies helping me. I'm quite content with my pricing but if they are willing to pay more, I'm willing to take it. Why?...because it will help me to balance out my numbers and fit into their "average".

My late father in law ran a funeral home. He told me that he lost money on the two lowest price funerals. He felt that he was contributing to the community by serving those that were unable to pay more. He said that he was fine with this so long as he didn't have to serve more than his fair share. He noted that the "helpful" local Priests would steer too many poor people to his funeral home, which forced him into raising his prices on the lowest priced products. In the end, it forced him to do what was necessary to stay solvent...but it hurt the poor people in his community because he didn't have the right balance between "lucrative" funerals and "poorman" funerals.

The same applies to roofs. Some roofs pay more and subsidize those that don't seem to work out. I'm doing one now that looks like it will return only a 24% gross profit markup. That is outrageously low...but it is offset by some that I have done closer to 100% markup. At the end of the year, I'll be close to the target that I've set out for myself. Am I wrong for trying to keep my head above water and survive? Don't I owe that to the customers I've already served? If you agree that it's right to profit and survive, then I don't see how you can view each individual job without looking at the bigger picture...the same way the insurance companies do it.

So, there are many reasons that I don't want to put my numbers on the table first. My numbers are calculated with a cold hard formula. As you've pointed out, the insurance company will sometimes be higher or lower than my number. Anyway I look at it, I feel I'm better off knowing their numbers before I put mine on the table. We are in a negotiation whether I like it or not and the first rule of negotiating is: knowledge is power. The second rule is: he who speaks first is in the weaker position. When you put those two ideas together, it makes perfect sense that I would prefer to view the insurance report before I put my numbers on the table. Even when it all happens like that, I'm usually fighting to get my number. Occasionally, I've been pleasantly surprised and didn't have to battle...but those cases are much too rare for my tastes.

As far as trying to save the general public a few pennies....I've never once gave that a thought. Now that you've mentioned it, I still won't think about it. I'm much too focused on my survival and also putting on a decent roof for my customers.

Lastly, I don't agree that we shouldn't replace roofs that have been pelted by hail. I've seen the evidence whereas roofs loose their granules a few years down the road thereby greatly reducing the service life of the shingles. I just replaced a roof that looked like it was new on the backside of the house and 25 years old on the front side of the house. I had advised the owner that his insurance company probably wouldn't approve the claim because I couldn't see any evidence of chunks taken out. I was wrong...the adjuster bought the roof and I believe it was the right decision.

What do you guys do when you go out to a job and the person just hands you the insurance adjustment, you glance at it and knowing the work is going to cost around $16,000......you see the insurance already gave a $19,000 check and still $6000 left to recover in depr.

Do you.......

A. Stick it to them and tell them repairs are going to take it all?

B. Tell them your price is $16,000....to enjoy their $3000 bonus?

C. Tell them 16000 is cost but then help them get any depreciations back they are entitled to and maybe do some other repairs?

D. Just tell them you will do everything for what the insurance paid, and then stick it to them?

How often do you guys let insurance company keep depr. money because it is not needed in your cost?

Just rambling......

minnesotaroofin Said: I pretty much agree with Randy it is twice the work selling and collecting an insurancce job. Jim you had to read an adjustment 15 times to get the hang of it now not only do you need to understand it so does your customer and not all are as bright when it comes to construction terminology - so you 15 times explaining once to a customer does not cut it most times. This ontop of just the plain old pitch about your company. Then you have to submit the paperwork and billing on a roof under 10k easy but those aabove the Mortgage companies and the w9s, completion certs, conditional lien waivers, 3 inspections and then more paperwork, then more waiting etc.... Probably more like 3 or 4 times the work.

I'll agree that there is more paperwork for some of those mortgage deals. I don't mind and it's not too much paperwork to deal with though. The first time through was a bit challenging but I immediately put everything into a spreadsheet. Now, every job I propose has the proper documents created with every "estimate". If I need the documents, I print and fax them. Usually, I fax them directly from the e-file.

So, most mortgage deals take me about ten minutes more than a non-mortgage deal. There is a benefit though....most checks are made out to both the client and my company and that reduces my risk. Also, some mortgage companies require a notarized statement. My banker notarizes all our docs so that doesn't really add anymore time to the job either because we are in the bank on a regular basis anyways.

I guess I'm one of the few that actually prefer insurance deals. I'm very comfortable explaining them and getting a signature on contingency contracts. The more complicated it seems, the more likely I'll get the job. The clients might not actually understand everything I'm telling them but I guess they trust me.

Jim, Just because I can. Just the honest truth. I have always been paid better by insurance then by normal homeowners, which I guess gets back to our earlier conversation about how some think insurance pays too cheap. If I have to deal with an adjuster, wait for payment....it should pay a premium.

Right now......on a 1 story, 1 layer, 3-tab, 5/12 roof with average number of vents, 1 chimney and a dish......insurance is paying $300+ I was losing bids @ 200 not long ago. There are still guys who will do them for 160-170.

I start high with insurance...then if they beat me down they are still above my normal price, if they dont beat me down...the homeowner wins.

Best to you.

There's a local auto body shop that advertises heavily on radio. For years(decades) their spiel has been to try to be on the side of the customer vs the insurance company. They'd claim to only use factory parts even though the insurance companies didn't want them to and claim that state law entitled the customer to use them and not one selected by the insurance company. Then, very recently, the've changed their ads. Now they brag about how they're the area's biggest auto body shop and most major insurance companies have adjusters right on their premises and how well they work with them.

I don't know what this means or has to do with the subject, I just ramble.

RandyB1986 Said: Jim, I understand where you are coming from on the estimate being higher than RCV. I think many homeowners get confused on the RCV, ACV and depreciation. And I tend to make insurance estimates higher than normal.....I try to explain to them why, but I think I confuse them even more.

Now I'm intrigued. "Why would you "tend to make insurance estimates higher than normal"?

If I have to give a number, it's going to be the same whether it's an insurance claim or a "regular" re-roof. I might adjust upward for difficulty factors but they would be the same for insurance and non insurance jobs.

Homeowners most certainly are confused about RCV ACV and depreciation. I was confused myself after reading some of them for the 15th time. I carry around a sample report and occasionally pull that out to discuss the various elements of the insurance system.

Jim, I understand where you are coming from on the estimate being higher than RCV. I think many homeowners get confused on the RCV, ACV and depreciation. And I tend to make insurance estimates higher than normal.....I try to explain to them why, but I think I confuse them even more.

The concept of "fighting the insurance co" is misleading.The insurance companies charge certain rates and they don't budge.Even if all roofers in town bid for that job the HO pays just the deductible so all that bidding doesn't save him any money.The selling point on insurance claims should be the quality of work.being local, having good subs and good references is what matters.

RandyB1986 Said: Jim...Sorry I didnt get back with you, I have been busy.

That was first hand knowledge.........we had a friends dad call them and they wouldnt even give him an estimate without signing the contract. Then we had an undercover reporter do the same thing.

You asked Is there something wrong with insurance proceeds.....well of course not, the problem is if I advertise a free estimate then I will give you a free estimate.....simply writing insurance proceeds is NOT AN ESTIMATE.

These bastards are also telling everyone they are a local company, when in fact they are out of Miami and have been shut down under 3 different names.

As for insurance not paying enough.........I think some people have too much overhead.

Thanks Randy. I'm still doing a lot of insurance work and this is good information. I like knowing how some of the stormers operate.

I agree, some people do have too much overhead. Some people are shooting for too big of a profit margin. Some people simply don't do business in a way that will fit into the insurance company's system of assigning value. At this point in my roofing career, it works for me in most situations.

I often get signatures, and commitments, to do the roof without giving a number. I simply agree to work with the insurance companies numbers and that works for some of the leads. There are other leads that insist on seeing a number. I'm fine with giving them one. In most cases, I already know the number but I'm holding out until I know the insurance number.

You might ask..why hold out? Well, I have lost jobs because my "estimate" was higher than the RCV, even though I explained that I would work with that number. The problem is that I'm not sitting in their kitchen when they open their insurance report and look at the numbers. They see their check and it's far below what they need to do the roof because the insurance company has witheld their deductible and depreciation. So, in a panic, they don't call me because my number is many thousands of dollars higher than their check. Then, some other roofer gets an appointment and gets the job because he's the guy sitting at the table when the insurance report is discussed and explained. I've won several jobs like that myself.

So, I don't see anything wrong with signing an agreement without knowing the numbers. We'll work them out after the insurance report comes in.

I have won quite a few jobs from stormers because they refused to give a number. Just the other day, a guy told me that he eliminated one of the bidders simply because the guy insisted on getting a signature and then "fighting the insurance company" for more than they were offering. I also did two jobs in the last month with a guy who refused to use a roofer that he had already worked with and was satisfied with...but...the guy just wanted to sign the deal for significantly more and then fight the insurance company.

The concept of "fighting the insurance company" must be lucrative because these guys seem to be stuck in that business model. Do you know anything about it?

Jim...Sorry I didnt get back with you, I have been busy.

That was first hand knowledge.........we had a friends dad call them and they wouldnt even give him an estimate without signing the contract. Then we had an undercover reporter do the same thing.

You asked "Is there something wrong with insurance proceeds".....well of course not, the problem is if I advertise a "free estimate" then I will give you a free estimate.....simply writing "insurance proceeds" is NOT AN ESTIMATE.

These bastards are also telling everyone they are a local company, when in fact they are out of Miami and have been shut down under 3 different names.

As for insurance not paying enough.........I think some people have too much overhead.