How is roof depreciation calculated?
Short answer. Roof depreciation is calculated line by line: each roofing item's replacement cost is multiplied by the roof's age divided by the material's expected life, with adjustments for condition. A 10-year-old architectural shingle roof given a 30-year life is depreciated about one third on most material lines.
A sample roof estimate
Here is how depreciation might look on a 10-year-old roof with a 30-year expected life, so 33 percent on the wear items:
- Shingles: $8,000 replacement cost, $2,640 depreciation
- Underlayment and ice and water barrier: $1,800, $594 depreciation
- Ridge cap, starter, drip edge, vents, and flashing: $2,400, $792 depreciation
- Tear-off and disposal: $2,800, often little or no depreciation
Total replacement cost: $15,000. Total depreciation: about $4,000. Actual cash value: about $11,000, before the deductible.
What changes the result
- Expected life. Three-tab shingles are usually assigned a shorter life than architectural shingles, which raises the yearly rate.
- Condition. Granule loss, curling, or prior repairs can raise it; a well-maintained roof can lower it.
- Caps. Some carriers limit how far a line can be depreciated.
- Policy type. With a roof payment schedule, a single percentage from a table replaces the line-by-line math.
Check your own estimate
For each line, divide the depreciation by the replacement cost. If the percentages do not match the age you know, ask the adjuster which inputs were used and send proof of the install date.
Related: Xactimate roof estimates, roof payment schedules, and recoverable depreciation.