Contractors: if you don’t know how much insurance companies pay for property repairs, you aren’t generating the correct amount of income.
Over 80% of insurance companies – including State Farm, Farmers, Allstate, USAA, Nationwide, MetLife, Liberty Mutual, Safeco, The Hartford, American Family, ASI, American Modern, QBE and many more – use the industry standard pricing software called Xactimate.
Q) What is Xactimate?
A) Xactimate is a third-party software made by Xactware, owned by Verisk. Xactware conducts extensive market research and comes up with a price for almost every conceivable item in construction. This includes variables for labor, material, equipment, general site conditions and general contractor’s overhead and profit.
Xactimate has a separate pricelist for different markets. San Diego has a different pricelist than Los Angeles; Miami has a different pricelist than Orlando, and so on.
Even more significant, Xactimate changes all pricelists once per month. Every month, the price to remove and replace one linear foot of fascia changes, for example.
Sometimes it changes a little and sometimes it changes a LOT.
This isn’t always a great thing for contractors as sometimes it goes down. However, after a hail storm, hurricane, large flood or other natural disaster which affects an entire market, usually -generally speaking- the pricelist for that market will go up in the next monthly pricelist update. It could even take two months or longer for the software to reflect the true market data.
For example, look no further than the recent April 2016 massive hails storms in North Texas, which affected the Dallas Fort Worth market.
Most professionals in the industry were fairly confident that the May 2016 pricelist would show an increase because of the direct market impact. It was afterall a multi-billion dollar event. Contractors were reporting that their material suppliers and subcontractors were sending out letters notifying their customers of price increases across the board. Reports were coming in of the unavailability of roofers and gutter installers.
However, in the May pricelist… nothing. Sure, it went up by a couple of dollars here and there but not enough to really impact most estimates as a whole.
Some were rather disappointed but it seems they weren’t alone.
Later in May, the North Texas Roofing Contractors Association (NTRCA) sent out an email to its members alerting them to this issue, along with a proposed solution to attempt to resolve it. The NTRCA members were encouraged to send an email to Xactware to voice their displeasure, and to share any info (from suppliers, subcontractors, etc) with Xactware that could possibly contribute to a resolution.
In June: major difference! Most estimates in this market went up significantly. And the July and August updates also saw slight increases.
Great job NTRCA and its members for following through!
See the above video and screenshots to see a specific example of a real claim in live action.
We had written an Xactimate estimate for our contractor client for a hail damage claim in the DFW market. Our estimate was already completed and we simply updated it from the May 2016 pricelist to the August 2016 pricelist.
It resulted in over a $2,600.00 increase! What can your company do with an extra $2,600?
The above described issue highlights the fact that it’s imperative to have experts on your side to help you navigate the complex waters of insurance repair estimating.
If you don’t present your estimates in Xactimate, you’re losing.
If you don’t have Xactimate experts creating your Xactimate estimates, you’re failing.
The obvious solution is definitely to turn to the leader in Xactimate estimate writing & invoicing service in the United States and Canada:
Visit us today to see what we can do for your business!