Many insurers pay only actual cash value (ACV) on an aging or worn roof, or decline the home, while lenders usually require the dwelling to be insured at replacement cost. Four common solutions: find an insurer with looser roof guidelines, document remaining roof life with an inspection, repair or replace the roof before closing (often with a seller credit), and confirm with your lender early what they will accept.
Get the roof report first
Ask for a roof inspection showing age, material and remaining life.
Compare roof guidelines
Each insurer sets its own roof age and condition rules.
Fix it before closing
Repairs, replacement or a seller credit are easiest before you close.
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ACV vs replacement cost
- Pays the depreciated value of the old roof
- The older the roof, the less you get
- You pay most of a new roof yourself
- Pays to replace with a comparable new roof
- No depreciation (deductible still applies)
- What lenders usually require
The home is your lender's collateral, so lenders usually require the structure to be insured at replacement cost. An ACV roof may not meet that requirement.
Four ways to solve it
Find looser roof guidelines
Insurers differ on roof age, material and condition; an independent agent can compare several at once.
Document remaining life
A licensed roofer's inspection or roof certification showing remaining years can help some insurers accept the home.
Repair or replace before closing
Negotiate repairs or a seller credit during the purchase and finish before closing.
Ask your lender early
Send the quote to your lender to confirm it's acceptable, not days before closing.
Other factors
Solar panels must be removed to replace a roof, adding cost and time. Wildfire risk makes an older roof even harder; FAIR Plan plus DIC may be needed. Prior water claims call for repair records.
A real case: 5 years of roof life left, plus solar
A client buying a new home asked for a quote. The roof inspection showed about 5 years of life left, with solar panels installed. We explained that the premium could stay below average, but most insurers would cover a roof near end of life only at ACV while his lender required replacement cost. We laid out several insurers side by side so he could decide before closing.
Results depend on individual circumstances. Identifying details removed.
Frequently asked questions
How old is "too old" for a roof?
There is no single rule; each insurer has its own guidelines on age, material and condition.
My insurer raised the roof issue at renewal after I bought the home. What now?
Get the insurer's exact requirement, get a roofer's inspection and quote, and compare other insurers. Don't wait until the policy expires.
Will my lender accept ACV on the roof if the rest is replacement cost?
Some lenders do and some don't. Ask your lender to confirm in writing.
This article is general information for California and is not a promise of coverage or claim payment. Coverage, pricing and terms depend on each insurer's policy and underwriting.