What can I legally negotiate on an insurance roof job?

First, sorry if this is really long, but this forum is fantastic and I thought you guys might be the place to find the info I need. You guys are a tremendous source of information and I’ve been binge reading your posts for the last day or two. I’m hoping there are some folks on here who are or have worked in Texas and can help with a question I have on insurance work.

I’m in the process of soliciting bids for a full roof replacement due to a hail storm we had last year. Thankfully, my insurance carrier approved a full replacement and has been rather generous with the overall claim value and a very low assigned recoverable depreciation. So all is well on that front insurance-wise.

However, in my process of getting bids, I have had multiple long-standing reputable contractors in town suggest a variety of freebies, rebates, advertising fees and whatnot. Unfortunately, I can not find any simple legal document for my state (Texas) that spells out what is legal to negotiate for or not.

Now clearly I do not want to do anything illegal, nor do I want to incur the wrath of my insurance carrier, whom I rather like. That being said, I am more than happy to take advantage of discounts and spiffs during the slow season if such things are allowed.

So for anyone who works in Texas…what exactly is allowed? From what I’ve read online and what the contractors say, the lists below are what is and is not allowed:

-Upgrades on insurable scope of work for discount/free (laminated shingles instead of 3-tab, better underlayment, better pipe jacks, etc), but they have to be on the insurance invoice at whatever cost we agree on, including $0.

-Negotiating upgrades outside of scope of work for discount/free (free gutters, free window screens, upgraded gutters), but they can not be on the insurance invoice.

-Modest/reasonable credit for advertising/reviews/referrals (like $500, not $2000).

-Negotiating upgrades in workmanship (6-nail pattern vs. 4-nail, starter shingles on both rakes/eaves) and warranties (7 or 10-year workmanship vs. 3-5 year workmanship).

Not allowed:
-Anything with double invoicing to insurance

-Any direct money transfer

-Any upfront waiving of deductible

-Two companies have told me that they can rebate me back a portion of my deductible after the job is complete and paid in full as a materials rebate, provided the rebate is less than my deductible. Normally, this would raise my insurance fraud hackles, but they both seem upfront about it and these are two of the biggest/oldest/best reviewed contractors in town. They are not storm chases or fly-by-nights, so I don’t know what to make of this.

You guys are great and any help you can give on this would be greatly appreciated. I hope you are all doing well and keeping busy in the winter season. Thanks!


Discounts for advertising are not allowed. Companies telling you this is okay know it isn’t and regularly commit insurance fraud. That’s just a chintzy way of paying the deductible. Upgrades are fine.

Why don’t you just find a high quality contractor. Give them all the insurance funds and pay your deductible in full. Negotiate a single upgrade and Workmanship upgrades. Then you have nothing to be concerned about and can have a clear conscious.

Yes, those were my thoughts too. I want no part in any sort of financial dodges since I have no problem paying my deductible. Even if nobody in law enforcement would ever care, I like my insurance carrier and they have always done right by me. I’ve been pretty surprised and dismayed at how many of the roofing businesses in town, regardless of age or reputation, seem to encourage insurance fraud. Even if there isn’t a specific law yet here that bans it outright, it’s certainly a violation of the home insurance contract itself. One roofer insisted that it is endemic to Texas (“just the way things are done here”, with a large majority of homeowners never paying the full deductible on a roofing claim.

Thanks for your input. I’m going to do exactly what you said. Interview a couple of roofers, find one who seems to check all the correct boxes, then negotiate with them for better shingles and workmanship under a contract for full RCV (including deductible), if not a little bit more.

Thanks again for your help.

Interesting…I figured I might as well go for broke and directly ask the senior desk adjuster on my claim what they do and do not care about since they are the only party likely to be injured in this sort of situation. They were super nice and responded, both verbally and in writing, that they don’t care what customers do regarding disbursed ACV funds or deductibles. The only things they care about is that the roof gets fixed competently and that nobody submits fraudulent invoices to collect depreciation that isn’t merited. They even said outright that if a roofer wants to waive our deductible in full, then that is fine with them, though it will mean no collection of the depreciation.

That actually could be great for us, since our deductible is more than triple the amount they are holding in recoverable depreciation. So now we have lots of flexibility to look for any mix of terms in materials/workmanship/pricing and don’t have to worry about pissing off my insurance carrier, nor is there even a remote possibility of unintentional fraud since they have replied in writing that they are fine with anything other than lying to get at depreciation that isn’t honestly owed.

Makes me wonder if the insurance carriers in Texas have simply given up on trying to enforce mandatory deductible collection given the rampant fraud that happens here. Then again, maybe having such a small split between ACV and RCV is rare, and the small split is the only thing that makes it potentially worth doing on the up and up.

Anyway, just wanted to drop this info for anyone else that might be in this situation at some point. This forum is a great source of info on a topic that is really esoteric to your average person.

The insurance companies don’t care much because the majority of the contractors out there eating deductibles don’t supplement the claims to make the insurance Pau what the actually should pay. Aside from having more storms than most, Texas contractors are no different than ones across the country. Aside from that, you’re over thinking it. If you want, message me your name and phone number, I will pass it along to a competent contractor with integrity in your area.