A Guide to Understanding Your Roof Insurance Payment Schedule

Posted on by Ashley Ellis

What is a payment schedule in roof insurance claims?

A Payment Schedule is a specific method used by most insurance companies to determine the settlement amount for a damaged roof. Unlike Actual Cash Value (ACV) or Replacement Cost (RC) settlements, this approach does not rely on the current market value or full replacement cost of the roof. Instead, it applies a predetermined percentage reduction based on the roof’s age at the time of the loss. The older the roof, the greater the reduction in the payout. This method is designed to offer a consistent and transparent settlement process for both the homeowner and the insurer.

How does the payment schedule work?

The Payment Schedule follows a sliding scale, meaning the amount you’re eligible to receive for roof damage decreases as your roof gets older. Here’s a simplified example to illustrate how this might work—note that this is just a general example and not an official payment schedule from any specific insurance company:
    •    Roof Age 0–5 years: 100% of the replacement cost
    •    Roof Age 6–10 years: 80% of the replacement cost
    •    Roof Age 11–15 years: 60% of the replacement cost
    •    Roof Age 16–20 years: 40% of the replacement cost
    •    Roof Age 21+ years: 20% of the replacement cost

Keep in mind that the exact percentages and age brackets can vary widely depending on your insurance provider and policy. The key takeaway is that the older your roof is, the lower the payout you can expect under a Payment Schedule approach.

The Process of a Payment Schedule Claim

Damage Assessment: Once you report roof damage, an insurance adjuster will inspect the roof to evaluate the extent of the damage and estimate the replacement cost.

Age Verification: The adjuster or insurance company will verify the age of your roof, typically requiring documentation such as installation records or receipts.

Payment Calculation: Using the Payment Schedule, the insurance company applies a percentage based on your roof’s age to the estimated replacement cost. For example, if your roof has a replacement value of $20,000 and is determined to be 6 years old, you may receive 80% of that value, or $16,000.

Settlement: The final payout is issued after subtracting your home insurance deductible. This amount is intended to help cover the cost of repairing or replacing your roof.

Advantages and Considerations

Advantages:
    •    Predictability: Homeowners have a clear understanding of what percentage of the roof replacement cost they might receive, based on the roof’s age.
    •    Perceived Fairness: The approach seeks to strike a balance between providing coverage for homeowners and managing risk for the insurance company.

Considerations:
    •    Reduced Payouts for Older Roofs: Homeowners with aging roofs may receive significantly lower settlements compared to Replacement Cost (RC) policies, especially if the roof was already near the end of its useful life.
    •    Policy Differences: Not all insurers offer a Payment Schedule option, and those that do may use widely varying age brackets and payout percentages. It’s important to review your specific policy details carefully.

In conclusion…

A Payment Schedule in roof insurance claims provides a structured, age-based method for determining settlement amounts after roof damage. Unlike Actual Cash Value or Replacement Cost policies, this approach reduces the payout according to the age of the roof, offering homeowners a predictable and transparent understanding of what they can expect. While it can be seen as a fair way to balance the insurer’s risk and the homeowner’s coverage, it often results in lower payouts for older roofs. Because Payment Schedules and their specific terms can vary greatly between insurance providers, it’s essential for homeowners to review their policies closely and understand how their roof’s age could impact a future claim.

Does Condo Insurance Cover Flooding in San Antonio?

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Living in San Antonio comes with many perks and benefits. However, this Texas town is no stranger to unpredictable weather that can cause significant property damage for local auto and homeowners.

Learn if your condo insurance policy covers flooding in San Antonio from the insurance professionals at Ellis Insurance Agency.

Does Condo Insurance Cover Flooding in San Antonio, TX?

The first step towards ensuring you have flood insurance coverage is to review your condo association’s Master Policy to determine if your unit’s damages are covered.

Their associations’ Master Insurance Policy covers most condo owners. This foundational insurance policy acts as a blanket shield that helps cover the costs of damages, liability claims, and accidents that occur in condo communities’ common areas.

Once you have determined the coverages for common areas and the exterior of your unit, talk to a licensed local insurance agent to learn if your condo insurance plan includes flood insurance.

In most cases, local condo owners will need to implement a condo insurance policy with a separate flood insurance policy to cover the costs of extensive flood damage.

A condo insurance policy can offer basic protection for water damage from broken pipes or a leaky roof but is typically unlikely to cover damages from extensive floods caused by the following events:

  • Flash Flooding Caused by Severe Storms and Heavy Rainfall
  • River or Creek Overflows
  • Hurricanes and Tropical Storms
  • Storm Drain Backups
  • Sewer Backups

An adequate condo insurance or flood insurance policy can mitigate risks of flood damage caused by flash floods, severe storms, or interior plumbing issues.

Contact a licensed agent at Ellis Insurance Agency to learn about which policy is right for you, get a quote, and protect your Texas condo from floods today!

Should I Consider Auto and Umbrella Insurance?

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We purchase home, auto, and other insurance to protect against the financial consequences of unexpected events. Insurance policies usually cover these liabilities because the policy limits exceed the damage. However, sometimes, the liabilities exceed our policy limits, leaving us responsible for the remainder. That’s where umbrella insurance steps in to ensure our financial well-being. If you have questions about an umbrella or other insurance, contact our team at Ellis Insurance Agency, serving San Antonio, TX.

Covering Your Potential Liabilities

Most auto accidents are relatively minor; the vehicles are repairable, and everyone involved walks away from the incident. However, some accidents cause disabling injuries or worse, resulting in liabilities exceeding the amount the insurance company is obligated to pay, based on the policy limits. Suppose you are found liable for a catastrophic accident. In that case, you may be responsible for paying the difference between the total award and the amount paid by your insurance, potentially putting your savings, home, or other assets at risk. That’s when umbrella insurance steps in.

A core purpose of umbrella insurance is to pay the liabilities exceeding your base auto (or home) policy’s limits. Since umbrella insurance only activates in "worst-case" situations, umbrella insurance payments are uncommon, and the rates are low. The combination means you can affordably obtain the extra layer of protection and peace of mind that comes with umbrella insurance while ensuring the assets you accumulated are not at risk due to an unlikely but catastrophic event.

Working With Ellis Insurance Agency

Umbrella insurance protects families and businesses. If you live in or near San Antonio, TX, and want to discuss your umbrella, auto, or other insurance needs, the Ellis Insurance Agency team is ready to help. Please stop by or call (210) 866-8683 today.

Can Roommates Share Renters’ Insurance?

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Insurance companies generally permit renters to share insurance policies, with the primary benefit being the ability to split the cost. However, sharing a renters’ policy isn’t suitable for everyone and can sometimes be disadvantageous, so it’s important to consider your options before making that choice. If you need answers concerning renters’ or other types of insurance, contact our team at Ellis Insurance Agency, serving San Antonio, TX.

Roommates Sharing a Renters’ Insurance Policy

Roommates sometimes share renters’ insurance policies to save money and for convenience. There’s only one monthly payment, and the roommates share the insurance costs. However, the cost savings are relatively minor since renters’ insurance is relatively inexpensive in Texas. It averages $14.42 monthly for $30,000 in personal property and $100,000 in liability coverage with a $500 deductible.

The problem with shared policies is that they can complicate matters. One issue arises when a roommate moves out. You must remove that roommate from the policy, possibly transfer the payment, and make decisions about who pays future premiums.

While these changes are inconvenient, a more significant issue arises when someone makes a claim. If you’re a party to a shared insurance policy, claims against the policy become part of your seven-year insurance record, meaning your roommate’s claim enters your long-term insurance record.

These issues may not be a concern if you know your roommate well, but that’s not always true. Shared insurance policies bring shared legal obligations, so paying slightly more may be better to maintain legal separation.

Insuring with Ellis Insurance Agency

Ellis Insurance Agency serves the San Antonio, TX, area. We can help you develop an insurance plan that meets your needs, so call us at (210) 979-9000 or stop in to protect yourself and your possessions.

Mold and Water Damage in RVs: What Your Policy Should Cover

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Recreational vehicles (RVs) are subject to unique risks, including mold and water damage. These issues can arise from leaks, condensation, or flooding, leading to costly repairs. Ensuring your RV insurance policy provides adequate coverage for these risks is essential for safeguarding your investment in San Antonio, TX.

Understanding Water Damage Risks

RVs often experience water damage from roof leaks, plumbing failures, or improper sealing around windows and doors. Over time, even minor water intrusion can lead to mold growth, structural weakening, and damaged interiors. Due to their compact and multi-material construction, RVs are particularly susceptible to extensive damage from small leaks.

Most RV insurance policies cover sudden and accidental water damage, such as from a burst pipe or storm-related leaks. However, gradual damage due to maintenance neglect is typically excluded. It’s important to perform regular inspections and repairs to ensure claims are not denied due to owner negligence.

Mold Coverage Considerations

Mold resulting from water damage is a growing concern for RV owners. While some policies include limited mold coverage, others exclude it entirely. If mold coverage is available, it usually applies to mold caused by a covered peril, such as storm damage, rather than long-term exposure or poor maintenance.

RV owners should consider add-on endorsements for comprehensive protection against water damage and mold remediation. These endorsements provide additional coverage for costly cleanup and repairs, offering peace of mind in case of severe damage. Combining thorough maintenance with the right insurance coverage can help protect your RV from costly and disruptive damage, ensuring your travel plans stay on track.

Contact Ellis Insurance Agency for Your Insurance Needs

Ellis Insurance Agency underwrites policies to meet customers’ needs. We serve San Antonio, TX, and the surrounding cities. Contact us today.

Why Your Motorcycle Insurance Should Be Separate From Auto Insurance

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If you own a motorcycle and one or two cars in San Antonio, TX, you might wonder why you can’t place them on the same policy. Although these vehicles essentially serve the same purpose, getting you from one place to another, each has a unique dynamic of risk and protection. Ellis Insurance Agency can help you choose an appropriate policy for your bike to keep you fully covered.

Motorcycles are More Vulnerable to Risks

There is a significant difference between motorcycles and autos in terms of weight. Autos weigh considerably more, causing more damage during crashes, while lighter motorcycles are more susceptible to road hazards, conditions, and weather. Motorcycles also require a higher level of skill to operate. This vulnerability, especially in terms of what motorcyclists experience while riding, is central to why you need a separate policy for your bike.

Motorcyclists Experience More Severe Injuries

The larger size and weight of sedans and SUVs, even subcompact models, better protect their occupants. When a motorcycle is involved in a high-speed accident, the rider is more likely to suffer severe or life-threatening injuries, requiring higher medical coverage. Medical payment coverage often addresses this issue and is a key difference between auto and motorcycle policies.

Other Considerations

Several other differences also come into play for motorcycle policies. These include:

  • Differences in accident rates
  • Repair costs
  • Motorcyclist demographics
  • Accessory coverage
  • Differences in value

In addition, many riders only use their bikes for leisure purposes and frequently store them in garages during cold and inclement weather. Drivers use their autos almost daily for commuting and errands.

If you recently purchased a motorcycle, contact Ellis Insurance Agency to learn about the differences in coverage in San Antonio, TX. Call our agents today to get started on your customized policy.

If Watercraft Insurance is Not Required in Texas, Why Should I Get It?

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Just like when you’re driving a vehicle, unforeseen situations can arise, leading to accidents. While your car insurance provides peace of mind, watercraft insurance is not required in Texas, leaving you unprotected.

Texas Watercraft Coverage

Although Texas does not require watercraft to be insured, owners can purchase coverage. The types of watercraft that owners often inquire about include powerboats, canoes, kayaks, jet skis, fishing boats, cabin cruisers, and sailboats.

When you contact our agents at Ellis Insurance Agency, serving the San Antonio, TX community, we can answer any questions you may have about watercraft coverage, such as the types of insurance available and additional options. You can also request a quote using our convenient online form.

Benefits of Watercraft Coverage

There are many unexpected situations where having your watercraft insured can make a significant financial difference. Insurance can help if your watercraft is involved in an accident, damaged due to fire, stolen or vandalized, or affected by weather-related situations such as lightning, or if you and property damage cause injuries to others.

When you speak with our agents, we can discuss different policies, such as collision, comprehensive, property damage liability, personal property coverage, medical payments, bodily injury liability, and incidents involving uninsured and underinsured boaters.

Contact Ellis Insurance Agency in San Antonio

If you need information about watercraft insurance in San Antonio, TX, contact our customer-friendly team at Ellis Insurance Agency. Our staff stays up-to-date on what customers need to know about coverage for watercraft. With this information, you will be better informed about what type of coverage suits your needs while providing protection.

Why Do Insurance Companies Run Credit Scores?

Posted on by Ashley Ellis

Insurance companies run credit-based insurance scores as part of their assessment process because these scores are seen as indicators of an individual’s financial responsibility and potential risk. Studies have shown a correlation between credit-based insurance scores and the likelihood of filing insurance claims. Individuals with lower insurance scores are statistically more likely to file claims, which can lead to higher costs for insurers. By using insurance scores, insurers aim to predict and mitigate potential risks, ensuring that they can set premiums that accurately reflect the likelihood of future claims. This practice allows insurers to price their policies more effectively, offering lower premiums to those with better insurance scores who are perceived as lower risk, while charging higher rates to those with lower scores to account for the increased likelihood of claim activity.

It is important to note that these companies use credit-based insurance scores rather than traditional credit scores, which means requesting an insurance quote will not hurt your credit score. An article on FICO.com provides a more detailed explanation of the differences between a credit score and an insurance score. Please click HERE to learn more.

Understanding how insurance companies utilize credit-based insurance scores can help consumers navigate the insurance landscape more effectively. While these scores are a tool for predicting potential risk, they also highlight the importance of maintaining good financial habits, as credit scores can influence not only loan rates but also insurance premiums. Insurance companies do offer exceptions to credit-based insurance scoring if you were the victim of identity theft or another qualifying life event, please click HERE to learn more. By leveraging credit data, insurers can offer more accurate pricing, rewarding financially responsible individuals with lower premiums. For more insights into how insurance scores differ from traditional credit scores, be sure to check out the detailed explanation on FICO.com.

Household Member Extended Coverage in Umbrella Insurance

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Umbrella insurance delivers supplementary liability coverage beyond the confines of your standard home, auto, or other personal insurance policies. This is particularly beneficial for residents of San Antonio, TX. A standout feature of umbrella insurance is its extended coverage for household members, which amplifies protection for family members residing in your home. Given the frequent and popular litigation culture, this could be instrumental in warding off financial loss resulting from lawsuits.

Scope of Household Member Extended Coverage

Household member extended coverage applies to all household members, including spouses, children, and other family members who share the same address. This coverage stipulates that if one such member gets tangled in an accident or incident invoking a liability claim, the umbrella policy can take care of the costs exceeding the limits of their existing policies.

To illustrate, if your teenage child gets into an accident while driving and is held liable for damages exceeding the coverage scope of your auto insurance, your umbrella insurance can cover the remaining costs. This also extends to other scenarios, such as a family member being sued for accidental injury or property damage inflicted on someone else.

Significance for Families

Household member extended coverage is particularly relevant for families as it shields against financial risks associated with potential lawsuits or high-stake claims. With children, especially teen drivers or other dependents in the household, the probability of liability claims can escalate. In such situations, umbrella insurance can provide peace of mind by extending coverage beyond standard policies’ limits.

Reach Out to Ellis Insurance Agency for a Deeper Diving into Insurance

At Ellis Insurance Agency, we offer extensive insurance-focused knowledge. Serving San Antonio, TX, we can help you understand and choose the right insurance. Contact our team today for expert insurance advice.

EIA September Newsletter

Posted on by Ashley Ellis

Read below to learn more about New Texas Vehicle Inspection laws starting January 1, 2025, Hurricane Helene update and hurricane preparedness, and the difference between an Insurance Agency vs. Insurance Company.

New Texas Vehicle Inspection Law

Starting January 1, 2025, Texas will eliminate the requirement for annual safety inspections for most non-commercial vehicles, as part of House Bill 3297. This means vehicle owners will no longer need to visit inspection stations for annual checks. However, a $7.50 fee, known as the “inspection program replacement fee,” will still be applied during vehicle registration. The collected fees will support state funds such as the Texas Mobility Fund and the Clean Air Account.

Despite the elimination of the safety inspections, vehicles in certain counties, including Harris, Fort Bend, and Montgomery, will still be required to undergo annual emissions testing to ensure compliance with environmental regulations. Commercial vehicles, however, are not affected by these changes and will still need to complete annual inspections.

Click HERE for more information.

Hurricane Helene

Hurricane Helene made landfall on the night of September 26, 2024, in Florida’s Big Bend area as a powerful Category 4 storm. With sustained winds of 140 mph, the storm caused widespread damage, particularly along the northwestern coastline. Officials issued warnings about life-threatening storm surges, which resulted in catastrophic flooding, while hurricane-force winds knocked out power to nearly a million homes and businesses. Florida Governor Ron DeSantis and other southeastern states declared states of emergency as the storm’s impact extended into Georgia and the Carolinas.

For detailed guidance on staying safe during hurricane season, check out our previous blog on hurricane preparedness. It covers essential tips and strategies to help you protect your home and family before, during, and after a storm.

Insurance Agency vs. Insurance Company

An insurance agency and an insurance company serve distinct roles in the insurance market. An insurance agency acts as an intermediary between customers and insurance companies. Agencies represent multiple insurers and work to find the best policies for their clients, tailoring coverage options to meet individual needs. They essentially sell and manage policies on behalf of insurance companies.

An insurance company, on the other hand, is the entity that underwrites and provides the insurance policies. It assumes the financial risk, collects premiums, and is responsible for paying out claims. While agencies focus on selling and servicing policies, insurance companies are the ones that create and back the coverage financially.

Referrals and Reviews

Referrals and Google reviews are key to our business growth by boosting credibility and expanding our reach. Referrals provide trusted, word-of-mouth endorsements, while positive Google reviews increase online visibility and showcase the quality of our services. Together, they build trust, attract new customers, and drive sustainable growth through customer acquisition and retention.