Supplementing Question


My question relates to how to deal with supplements from the customer’s perspective.

Let’s say we contract with the customer for say, the $10,000 the insurance originally allowed for and can make a normal profit at this point. But if we can get another $1,00 in supplements approved we want to do that.

Do we wait to walk through the supplement process with the insurance before getting a final estimate approved by the homeowner? It seems like this could open up the door for them to choose someone else if they are still waiting a couple more weeks to work out supplements.

My concern is that we wait and get the supplement approved and now the total cost of the estimate I put in front of the homeowner is now $11,000. What if the customer decides at that point to go ahead and shop it so they can pocket the additional $1,000?

I would think that just putting a clause in the estimate that says something like “Any supplements approved by the Insurance company will be assigned over / paid to the contractor.”

What do you guys do? Any help would be great.


Your contract should be a contract, not a contingency. By and large, contingency agreements have shown to be worthless if taken to trial. Your contract should clearly state that any supplements will be added to the contract amount and paid to the Contractor. Your scope of work document should have the same statement. Whenever you do supplement, you should advise the Homeowner of what you’re doing, why you’re doing it and explain you may need their support.

We never have an issue with this.


We’re pretty new to Xactimate. Do you use that as your estimate and a separate document for your contract? Or can do you utilize Xactimate for both?

I guess I’m a little confused on how to utilize a scope of work, contract, and Xactimate estimate together now that we have the software.

Thanks for the help.


Xactimate is for creating your insurance estimate. Has nothing to do with your contract, nothing at all.

Sign contract with supplementing clause included in contract.

Create estimate utilizing Xactimate.

Claim approved, scope of loss received.

Scope of work created based upon scope of loss, additional work to be done, scope work not being done, other. Includes clause for supplementing. Customer signs.

Use Xactimate combined with heading letter (mine are generally in email) to supplement.

That is generally the sequence of events. I hope this helps you understand how the pieces/tools play together.


Super helpful. Really appreciate it.

Just one thing I’m still not clear on. Above, you have the contract before the estimate. How is that possible if the scope of loss / work is not yet known?


Don’t you sign your Customer to a contract before you start working with them? I guess if the roof has already been approved, then the contract would come second. If it hasn’t, the contract comes before you do anything else.


We just got on board with Xactimate. For years we’ve only done a single estimate that functions as the contract. It’s basically a scope of work that has a signature line and says " Payment due upon completion of work. Two year warranty on all labor." We’ve never had an issue with doing things that way.

But we’re wanting to see how to do things better and especially start doing supplements, which we’ve never really done before. That’s why I was confused about your contract coming first. We usually just get an Eaglview, or if the customer provides us with their insurance claim ,then we just work up an estimate off that…and the “estimate” is our proposal/contract.

How then do you have the customer sign a contract before you even have a scope of work? Is it just an “intent to hire”, so we don’t do a lot of work and then they go hire someone else?

Thank for your patience. This dialogue has been very helpful.


Do your research here. Unfortunately, I don’t have the time to educate you one step at a time. You need a specific insurance contract that is signed upfront before you do anything. That is how people who do lots of insurance business work. Mine has evolved over a long period of time and I’m sure has about $10K invested in legal fees at this point.

Do not do a contingency agreement. They’re worthless. You’re contract should be a contract from day one. Mine does not mention contingency anywhere in it. Do not have cancellation penalties. Courts don’t like cancellation penalties. You should have termination for convenience and fees for work done associated with that.

Yes, your contract is intended to protect your investment in time by potentially inspecting, taking pictures, creating an Xactimate estimate, meeting adjuster and even supplementing. You do all that, get the claim where it needs to be and the Customer decides to let their cousin do the work.


Authentic_Dad - Well said, we operate the same way. The Contract is a definite minimum, that clearly states all efforts regarding supplements based on work complete, required to comply with current building code, current construction practices, or manufacturer installation guidelines, will be collected in addition to the minimum. Ours also says as payed by the insurer, but we are pretty good at getting what we need, refuse to bill for anything not complete, and only collect deductibles from our clients.


You sign the original contract before meeting the insurance provider because you are going to be putting time and effort into assisting the homeowner in dealing with the adjuster and insurance company to get approved. You don’t want to go through all of that just to have the homeowner choose somebody else to do the work. Our contract does not obligate the homeowner unless we get total replacement of the roof. If approved, we immediately write our addendum contract directly from the first Scope of loss, this includes our supplemental statement so the homeowner understands that if we get items missing from the original Scope paid for on the back end, those funds are due to our company (obviously in much greater depth).


Thanks for the help on the process. Very helpful.


I realize I am late on this, but talking to your customer about supplements from the very beginning is crucial! Be transparent and explain that all adjusters are not created equal and there may be line items that are missing from their estimate that will need to be supplemented. Some homeowners will want to know what you plan to supplement prior to sending it to the insurance company, but be transparent and share it with them. I recommend not only that your contract state that all supplements will be paid to the roofing company, but that you have the homeowner initial that statement confirming that they understand and agree. Also, for your contract to be legally binding and to be able to file a lien if necessary, both homeowners have to sign the contract - otherwise you can be fined for filing an unlawful lien!