By law, you are required to pay your deductible. Insurance is on the hook for actual cost minus deductible. If the actual cost realized by you is less than insurance estimated then you are supposed to report the difference so they can reclaim the overage paid to you. Not doing this constitutes insurance fraud and is illegal.

Definitely Not A Cop said:

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Say ins co estimates $15k ACV to replace the roof on my house. Less deductible, they cut a check for $10k. $2.5K in recoverable depreciation.

If the roofer comes back and offers to do the job for $13k, am I entitled to keep the extra $2K offered in the original check?

Also, I assume I wouldn't be entitled to any of the extra depreciation recovery?

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If thee carrier cuts you a check for 15,000, and your roofer has contracted with you to do the roof for 13,000. You write him a check for 13,000.

This is not illegal.

There are a ton of ways this can go to fraud and illegal based on how you are billed, or what your roofer does, of course, but on it's face, what you are asking is as I said above.

Call me to discuss for free if you need more information and to make sure everything is legit and on the up and up.

It becomes illegal when your roofer refunds money or charges the insurance company more than he charges you.

What you need to ask yourself is "how did the cheapest person on the planet (the carrier) cut me a check for the cheapest job possible and my roofer beat that price"?

You carrier is the biggest cheapskate in the world. They have determined that your roof should cost a bare minimum of the price they gave you. Yet, your roofer has managed to come in cheaper by a sizable margin. You better figure out why and what you are losing to make that happen. Might be fine, might not be. Check it out.

As I have said before on the forum, he should bill for the price of the roof and if he has extra money in that job, he should be upgrading you for free. This is what I do whenever I can. When I have excess, I give away upgraded hip and ridge, ridge vent, free accessories, synthetic underlayments, upgrade the shingles, etc.

There is recoverable depreciation you are leaving on the table with the carrier the way you are asking about, and that is where your roofer should be hooking you up to make your home better than it was. Do not settle. This is your roof on your home. Plus, once I upgrade my customers, the next roof replacement and all of those upgrades are now the responsibility of the carrier the next time around. It just puts my customers in a better position than they were in prior and I'm happy to do that.

I have spoken to countless Ags over the past several years, and I am happy to check out your stuff if you are concerned about anything. I'd rather give away free advice and experience than watch someone get less than they should be getting. Please don't hesitate to call.

Navigate carefully and intelligently and you'll be OK.