The Insurance Restoration Industry's Field Journal
Published by Phase III Construction LLC | phase3construction.com
Actual cash value settlements are the carrier's first move — not the final word. The professionals who understand this distinction recover substantially more for their clients.
Actual cash value settlements are the carrier's first move — not the final word. Understanding how depreciation is calculated, where recoverable depreciation lives, and when a supplement is warranted can be the difference between a partial and a full rebuild for your client. The ACV check is not a settlement; it is an opening position.
Recoverable depreciation is the gap between actual cash value and replacement cost value. Most Michigan homeowner policies carry an RCV endorsement, which means the withheld depreciation can be recaptured once work is completed. The contractor's role is to document completion to the carrier's satisfaction and submit the recoverable depreciation claim within the policy's completion window — typically 180 days from the ACV payment.
The supplement process begins before work starts. If the initial Xactimate scope misses line items — and it frequently does — a supplement should be submitted with specific photo documentation, measurement verification, and applicable code citations. Carriers do not typically volunteer to reopen scopes. That initiative comes from the contractor or the policyholder's advocate. Document precisely. Supplement aggressively. Accept nothing that isn't supported by the physical evidence.
Experienced adjusters routinely use three tactics to reduce paid claim values: scope exclusions on code upgrades, broad “matching” denials, and premature close-outs. Each tactic has a documented counter-strategy that experienced restoration contractors deploy through supplementing.
We break down each tactic and the documentation strategy that counters it — directly applicable in MI, OH, and IN markets where these patterns appear most frequently on commercial and residential storm claims.
Get Claim Support →Carriers reject supplements that lack photo evidence, specific line-item support, and code citations. A supplement without documentation is an opinion. A supplement with documentation is a record that carriers must respond to on the merits.
This issue covers the documentation structure Phase III uses for supplements in SE Michigan — including which Xactimate line items are most frequently omitted on first estimates and the specific photo requirements for each category.
See Our Process →Michigan's standard homeowner policy contains an appraisal clause that can force carriers to negotiate disputed amounts through a formal appraisal process. But timing and threshold matter significantly to the outcome.
We cover the scenarios where invoking appraisal accelerates resolution versus when it drags out the claim and costs more than it recovers — and the pre-conditions that must exist before appraisal becomes the right tool.
Talk Strategy →Michigan's assignment of benefits landscape, coupled with post-COVID material cost inflation, has created an environment where first-estimate settlements are systematically underfunded. Contractors who document precisely and supplement aggressively recover significantly more for their clients than those who accept initial offers.
Phase III Construction specializes in insurance restoration across SE Michigan. Our team works directly with adjusters, documents damage to carrier standards, and builds supplements that hold up through review. We fight for the full scope — not the first offer — on every job we take.
Published quarterly. Free to adjusters, public adjusters, and restoration contractors. For claims documentation support, call (734) 237-7322.
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Published quarterly by Phase III Construction LLC — 37600 Ford Rd, Westland MI 48185