How to read an insurance scope of loss
The scope of loss is the only document on your claim that says what gets rebuilt. Most people never read it properly, and it is where almost every problem starts.
After the adjuster visits, you get a document. It might be called a scope of loss, a scope of work or just the estimate. It is usually several pages, it is organised by room, and it is full of abbreviations. Most homeowners skim the total at the bottom and file the rest.
That total is the least useful number in it. The scope is a list of work, and the total is just the list priced. If something is not on the list, it does not get paid for, no matter how obviously it needs doing. So the list is the thing to read.
What the document actually is
Someone measured your rooms and wrote down the work they believe the damage requires. That person may have been in your house for twenty minutes, often before anything was opened up. They were working from what they could see.
The pricing usually comes out of estimating software with regional unit prices built in, which is why the numbers look oddly precise. Arguing with those unit prices is almost always a waste of time. They are a published rate, and your adjuster did not choose them.
How a line item is built
Each line has a description, a quantity, a unit and a price. The quantity and the unit are where the money is.
- SF is square feet, for things measured by area like drywall, paint and flooring.
- LF is linear feet, for things measured along a run like baseboard, casing and countertop.
- EA is each, for countable items like outlets, doors and light fixtures.
- R&R means remove and replace. Remove on its own means the old material comes out and nothing goes back.
- D&R means detach and reset, where something is taken off, kept and put back. Toilets, vanities and radiators often appear this way.
Read the quantities against the room you are standing in. If the scope says 180 square feet of drywall for a room with four walls that are eight feet tall and twelve feet long, somebody has allowed for part of the room. That is not dishonesty. It is usually an assumption about how far the damage travelled, made before anybody opened the wall.
The parts that go missing
When I read a scope next to the actual damage, the same handful of things are absent. None of them are exotic.
The work behind the finish
Drywall and flooring are visible, so they get listed. Wet insulation, a vapour barrier that has to be cut out, a subfloor that has swollen, electrical that sat in water: those are behind the finish, and they are frequently not there. You cannot put new drywall over wet insulation and call the house repaired.
Removal to a sensible line
A scope will sometimes allow a two foot flood cut where the whole sheet has to come out, because the drywall above it is stained or the seam will land in a bad place. A patch that will be visible forever is not a repair.
The work that is not repair but is required
Permits where the work needs them. Disposal and bin rental. Dust containment and floor protection so the rest of your house does not become part of the job. Moving and protecting contents. These are real costs and they are often thin or absent.
Matching
If a floor runs continuously through three rooms and only one room is damaged, replacing one room leaves a seam in the middle of your house. The scope may well price one room. That is a conversation worth having early, and I have written about what happens when the material is no longer made.
Read the list, not the total. Every argument worth having is about a line that is missing or a quantity that is short.
The columns at the right hand side
You may see two totals, one lower than the other. One is replacement cost and one is actual cash value, which is replacement cost with depreciation taken off. Many policies pay the lower figure first and release the rest once the work is finished and invoiced.
I am a contractor, not an adjuster, so I will not tell you what your policy does. Ask your adjuster directly whether you are on replacement cost and how the holdback is released, and get the answer in writing. If the total is simply too small for the work, that is a different problem and I have written about the gap between a settlement and a real quote.
What to do once you have read it
Mark every line where the quantity looks short, write down every piece of work you can see that is not on the list, and take both to your adjuster as questions rather than complaints. A scope question has a factual answer, and that is a far better conversation than a disagreement about a total.
You do not need a contractor to do this. You need a tape measure and an hour. Where we help is putting a quote against the insurer's own line structure so the two documents can be read side by side, and standing in the room at a re-inspection to explain why a line has to be there.
If the insurer's scope is fair, I will tell you so. That happens more often than people expect, and it is a short conversation that saves everybody weeks.
If a previous crew already opened everything up and stopped, start with the unfinished job instead. The rebuild work itself sits on the home renovation page, and you can send me your scope and I will tell you where it is short.
Common questions
What is a scope of loss?
It is the itemised list of work your insurer believes the damage requires, organised room by room, with a quantity and a price against each line. It is the document that decides what the claim pays for, which is why the list matters more than the total.
Can I ask for the scope of loss in writing?
Yes, and you should have a copy. Ask your adjuster for the full itemised estimate rather than a summary. If you are only given a total, ask again, because a total cannot be checked against anything.
What does R&R mean on an insurance estimate?
Remove and replace: the old material comes out and new material goes in. If a line says only remove, nothing is going back in its place, which is worth noticing before you agree to it.
Why is the drywall quantity lower than my room?
Usually because the estimate assumed the damage stopped somewhere short of where it actually stopped, and that assumption was made before anything was opened up. Measure the room and raise the difference as a question.
Will you look at my scope of loss before I agree to it?
Yes, and there is no charge. I will read it against what I can see in the house and put anything missing in writing, so you have something concrete to take back to your adjuster.
Where we do it
