Price Doesn't Matter
Hello everyone, I'm Charles Thayer, and today, we are going to talk about why "Price doesn't matter" when dealing with choosing a contractor to repair storm damage. That's right, today you will learn why price should not be taken into consideration the next time you have storm damage and need to choose your next contractor.
One of the questions I get more than any after sever storms roll through is, "Can you give me an estimate?" To which I always ask, what are the reasons you're looking for an estimate? In the end, I've realized that most requests for estimates are initiated due to the following reasons:
The home owner doesn't understand the modern day insurance claim process.
The home owner is trying to play with the numbers a bit to see if they can come out ahead or wipe out the deductible or who knows ... maybe even pocket some extra cash ... Listen, I get it; it's human nature to consider whats best for you.
The homeowner believes that it is their responsibility to get estimates, usually 3 seems to be the magic number, so they turn them into the insurance company, like a good customer.
When you make an insurance claim, you are asking your insurance company to restore your home back to it's pre-storm condition. The best part is, this is the one time in your life you can shop as if "money is not an object". That's right; price doesn't matter.
The first reason price doesn't matter is the insurance companies will write their own estimate using their own pricing software. The price they come up with is the starting point. For this scenario, we are going to use your roof that the insurance company wrote up for replacement. The price they came up with is $10,000.00, but your deductible is 1,000.00. So, they will pay you $9,000.00 and $1,000.00 comes out of your pocket. But they don't pay you the full $9,000 right away. They will hold some of that money back. In this case, we will say $4,000.00. They've paid you $5,000, and before they'll release the $4,000.00 to you, you will need to prove what you spend for the roof replacement.
So let's say you did get 3 estimates. One is for $7,000 (The Roof Goofs), one for $9,000 (The Roof Dudes), and one for $12,000 (Do It Right Chyea Construction). Now one thing you should know is the estimate that came in at $12,000 is the most detailed of the three. It also has many code compliant items listed on it that are required for proper installation, BUT your insurance company's initial estimate did not list any of these items on it.
So, you did what you thought was right. You dismissed the low bid of $7,000 since the Roofs Goofs gave you that not so good feeling, and you also did not want to pay any more out of your pockets than you needed to, so you dismissed the $12,000 bid. You say to yourself, "Well, a roof is a roof and a shingle is a shingle, let's just go with the $9,000 Estimate that the Roof Dudes gave us and we won't even need to pay our deductible!"
Did you make the right choice? Well, your insurance company might say so. You just saved them $1,000! They should send you a thank you card! Remember that one little special thing I said 90 seconds ago? PROVE WHAT YOU SPEND in order to receive the available funds. So, instead of spending the $10,000 on a new roof, you spent $9,000, and when you send in your invoice to prove it, they send you a check for $3,000.00... They paid you $5,000.00 up front and released $3,000.00, leaving you with your deductible to pay of $1,000.00. Even if you would have gone with the lowest of $7,000, they would have only release a total of $6,000, leaving you with your deductible of $1,000.
So all of that effort and time meeting with 3 contractors did nothing for you and in the end. You have a mediocre new roof, courtesy of the roof dudes, at best.
But... What would have happened if you would have gone with the highest estimate? I mean, after all, this is your home, and you pay good money for good insurance, so why not do what's best for your home? If you would have spent $12,000.00 with Do It Right Chya Construction, as long as your sales rep explained to the insurance adjuster that all items listed on the $12,000 estimate were clearly needed per code and should be included on the adjuster's estimate, and they agree, you would end getting $11,000.00 from your insurance company for the best roofing system and you still end up spending $1,000.00.
In the end, remember: price shopping isn't in your best interest. Find the contractor that has a great local reputation, best-in-class materials and warranties, and, most importantly, gives you the re-assurance that you are going to get great service and communication throughout the process.
Again, I'm Charles Thayer reminding you to do what's best for your home, regardless of price.
Take care everyone!