Why do contractor estimates differ from insurance estimates? Learn how to use contractor quotes to negotiate higher settlements.
Get Claim Command Pro →The gap between contractor estimates and insurance adjuster estimates is often $5,000, $10,000, or $20,000 or more. This isn't because contractors are padding estimates—it's because insurance companies systematically undervalue claims.
Contractors quote actual market rates based on current material costs and labor rates in your area. Insurance adjusters use proprietary software with pricing databases that are often years out of date and calibrated to produce low estimates. These databases don't reflect real-world costs.
Contractors identify all necessary repairs because they'll be responsible for completing the work. Adjusters often miss items, exclude related repairs, or minimize scope hoping you won't notice. Contractors include everything required for proper repair; adjusters include the minimum they think they can get away with.
Contractors want to provide accurate estimates so they can complete the work profitably without change orders. Adjusters are incentivized to minimize claim payouts. Their performance is often evaluated based on how low they keep claim costs.
Contractors specialize in specific types of repairs and understand all the work involved. General insurance adjusters handle all types of claims and may not understand the full scope of repairs required for your specific damage type.
Insurance databases often show prices 20-30% below actual material costs
Adjuster labor rates may be $20-$40 per hour below actual contractor rates
Contractors identify repairs the adjuster missed or excluded
Contractors measure more accurately and include waste factors
Insurance may exclude or minimize contractor overhead and profit
Contractors include required code upgrades; adjusters often don't
Contractor estimates are your most powerful negotiation tool. Use them strategically to challenge low insurance estimates.
Get tools and guidance to use contractor estimates effectively in claim negotiations.
Get Claim Command ProNot automatically, but contractor estimates provide strong evidence of actual repair costs. If multiple contractors quote similar prices, insurance companies typically negotiate toward those numbers.
Get multiple estimates. If three contractors all quote similar prices, it's not padding—it's the actual market rate.
You can try, but most contractors won't work for insurance estimate amounts because they're below actual costs. You'll either need to pay the difference or negotiate a higher settlement.
Get estimates after the adjuster inspects so you can compare. However, having contractors inspect early helps ensure all damage is documented.
Escalate to supervisors, file regulatory complaints, or invoke your policy's appraisal clause for valuation disputes.