Free tool · adjusters and policyholders
Depreciation Dispute Calculator
Work backward from the carrier's depreciation to the useful life it assumed, compare it with published life expectancy, and see the overstated holdback in dollars.
Useful life the carrier implied
20.0 yrs
12 years ÷ 60% depreciation
Benchmark useful life
30 yrs
Manufacturer 30-year warranty (not in NAHB)
Carrier depreciation
$12,840
60%
Benchmark depreciation
$8,560
40%
Depreciation overstated by
$4,280
Released now on ACV, not held until the repair is done.
Depreciation challenge
Benchmarks are published averages. A carrier may argue condition; ask for the condition evidence in writing.
Why depreciation is worth checking
Most carriers depreciate on a straight line: age divided by useful life. The useful life is the input nobody shows you, and a few years either way moves thousands of dollars on a roof. Working backward from the percentage on the estimate exposes it.
State rules that change the answer
Labor depreciation depends on the state. The Minnesota Supreme Court (Wilcox v. State Farm, 2016) held labor may not be depreciated under the state's ACV statute. Arkansas allows it only with approved policy language. Other states are split, so check before accepting it. In the hail markets of Texas, Oklahoma, Colorado and Minnesota, many roofs are written on roof-payment schedules or ACV roof endorsements, and the schedule replaces the useful-life math. Ask for the endorsement before arguing life expectancy.
Benchmark useful lives
| Item | Years | Source |
|---|---|---|
| Asphalt shingle roof (3-tab) | 20 | NAHB 2007: asphalt shingles about 20 years |
| Architectural shingle roof | 30 | Manufacturer 30-year warranty (not in NAHB) |
| Fiber cement shingle roof | 25 | NAHB 2007: about 25 years |
| Wood shake roof | 30 | NAHB 2007: about 30 years |
| Clay/concrete tile, slate or copper roof | 50 | NAHB 2007: over 50 years |
| Aluminum gutters | 20 | NAHB 2007: 20 years aluminum |
| Vinyl, fiber cement or brick siding | 50 | NAHB 2007: lasts as long as the house (50 used as a floor) |
| Exterior paint | 15 | NAHB 2007: 15 years or longer |
| Carpet (8–10 yrs) | 9 | NAHB 2007: 8 to 10 years |
| Vinyl flooring | 50 | NAHB 2007: up to 50 years |
| Hardwood flooring | 100 | NAHB 2007: 100 years or more |
| Kitchen cabinets | 50 | NAHB 2007: up to 50 years |
| Drywall / walls and ceilings | 70 | NAHB 2007: walls and ceilings last the life of the home (70 used as a floor) |
| Furnace (15–20 yrs) | 18 | NAHB 2007: 15 to 20 years |
| Heat pump | 16 | NAHB 2007: 16 years |
| Air conditioning unit (10–15 yrs) | 13 | NAHB 2007: 10 to 15 years |
| Water heater, gas or electric | 10 | NAHB 2007: about 10 years |
| Tankless water heater | 20 | NAHB 2007: more than 20 years |
| Refrigerator / dryer | 13 | NAHB 2007: about 13 years |
| Gas range | 15 | NAHB 2007: 15 years |
| Dishwasher / microwave | 9 | NAHB 2007: 9 years |
| Natural stone countertops | 70 | NAHB 2007: lifetime (70 used as a floor) |
Run the full ACV math, first check and holdback in the recoverable depreciation calculator, and see the other free tools on the tools page.
Questions
- How do I know if depreciation is too high?
- Divide the item's age by the depreciation percentage. The result is the useful life the carrier assumed. If a 12-year-old architectural roof is depreciated 60%, the carrier assumed a 20-year life on a product usually warranted for 30. The calculator shows that gap in dollars.
- Where do the useful lives come from?
- From the NAHB / Bank of America Home Equity Study of Life Expectancy of Home Components (2007): asphalt shingles about 20 years, carpet 8–10, furnaces 15–20, water heaters about 10, cabinets up to 50. Architectural shingles are not in the study, so their 30-year figure is the common manufacturer warranty and is labelled as such.
- Can an insurer depreciate labor?
- It depends on the state and the policy. Arkansas, for example, allowed labor depreciation from August 2017 only with policy language approved by the Insurance Commissioner (Ark. Code §23-88-106). Enter the labor share to see how much labor was depreciated, then ask for the policy language that permits it.
- Is overstated depreciation recoverable later anyway?
- On a replacement cost policy the holdback comes back after the repair, if the paperwork is filed in time. Overstated depreciation still matters: it shrinks the first check that funds the repair, and on an ACV-only policy or an unrepaired item it never comes back.
Want the whole estimate checked?
Depreciation is one column. We review every line of the carrier's estimate and write the full-scope Xactimate® estimate, free for the first one.
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