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Confirmation of Deductible Payment

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Confirmation of Deductible Payment

P1Mitigators™ — Jacksonville, FL — (904) 891-8435

All insurers are required by state law to pay their deductible (or the portion that is equivalent to their repairs) to their 1st chosen contractor. The insurance carrier has the right and will sometimes ask, require or demand proof that this deductible has been physically paid to a contractor — or both parties could be accused of insurance fraud.

How the deductible is being paid

Property & Claim Details

This document will be a part of your entire job folder once signed and saved.

How a Deductible Actually Works

Contractor Estimate / Damages

$20,000

Homeowner knows it. Carrier knows it. Carrier agrees to 100%.

Your Deductible

$2,000

So how much does the carrier send?

Carrier Sends You

$18,000

If you guessed $18,000 — correct!

But, if you think they “kept” the $2,000 as your deductible — you’d be incorrect. The carrier knows the total is $20,000, so they intentionally send only $18,000 — forcing you to pay the $2,000 difference directly to the chosen contractor. Just like a co-payment at the doctor’s office, the homeowner physically has to pay it to start or complete the process. You can and should confirm this with your carrier — they will surely say yes.

See It in Action — $20,000 Claim Example

Insurance Claim Breakdown

Example — Hurricane / Storm Damage Restoration

$20,000

Total Contractor Estimate / Damages

$20,000.00

Carrier Approved

Less: Homeowner Deductible

– $2,000.00

You (Out-of-Pocket)

Insurance Proceeds Check Mailed to You

$18,000.00

Carrier Pays

Your Total Out-of-Pocket Cost

Deductible only — nothing more

$2,000.00

Carrier Pays (Proceeds)

Goes directly to contractor for repairs

$18,000.00

Total Claim Value

$2k yours + $18k carrier

$20,000.00

The retail price is never the same as the insurance price. Your deductible IS the job cost.

The Deductible IS the Job Cost — There Is No Price Shopping

On a true restoration job paid with insurance proceeds, all you pay is your deductible — nothing more. Your deductible IS the job cost.

This is not a retail job. This is insurance proceeds work — a long timeline, and supplements (unforeseen labor and materials) are often involved. Because of that, the retail price is never the same as the insurance price, and there is no price shopping when a contractor does the job for the quoted insurance proceeds.

Don’t let the insurance company fool you into chasing 35 estimates — taking time off work and burning your own money — just to save them a few dollars. On a covered restoration claim, you pay your deductible and nothing beyond your deductible.

You can and should confirm this with your insurance carrier — but the answer is the same: on a true insurance-proceeds restoration project, you only pay your deductible.

How Payments Split Across Contractors

How the Payments Split Across Contractors

  • It is a running tally: You pay out-of-pocket for the very first emergency services you hire until your deductible is met.
  • The Insurance Check: Once your deductible amount is reached, your insurance company pays the rest of the covered claim amount.
  • The “First-Come” Reality: Usually, the tarping company or tree removal company arrives first to secure the property. You will pay them directly.
  • The Roofers: Because roofing takes longer to schedule, the roofers are usually paid later. Their final bill will be paid using the remaining money from your insurance claim check.

An Example Scenario

Imagine you have a $5,000 hurricane deductible, and your total storm damage is $20,000. The insurance company will only mail you a check for $15,000($20,000 minus your $5,000 deductible). Here is how you would distribute the money as the contractors show up.

Key Takeaways for This Order

  • The Tree Company gets paid first: Because they must perform their work first to clear the structure, you pay them their full $3,500 invoice directly.
  • The Tarping Company finishes the deductible: Their $1,500 invoice absorbs the remaining balance of your $5,000 out-of-pocket obligation.
  • The Insurance Check covers the rest: At this point, you have spent $5,000 of your own money. The $15,000 insurance payout goes entirely toward the final roofing bill.

Crucial Warnings for Florida Homeowners

  • Contractor Scams: If a contractor offers to “waive,” “absorb,” or “reimburse” your deductible to get your business, do not hire them. In Florida, it is a third-degree felony for a contractor to pay, waive, or rebate any part of an insurance deductible.
  • Keep Every Receipt: Save every invoice and receipt from the tarping, tree, and mitigation companies. You must submit these to your insurance adjuster so they can officially credit those payments toward your calendar-year deductible.

Other Forms of Payment

Supplement — additional (unforeseen) labor and materials needed to make the homeowner whole again. On a roof, for example, we can’t always see all the damage until the shingles and underlayment are removed first — or how large a tree really is when it’s buried under a shed or a living room.

Recoverable Depreciation (RD) — shown on your policy payout in parentheses — is the money the carrier holds back until you prove the job has been completed. This RD money is also paid to the contractor working on the project, as an “insurance proceeds” type of arrangement.

WHY This Is the Correct Way

When doing disaster or storm-damage type work, sometimes the majority of the damages can’t even get seen or estimated — so we do provide our good-faith estimate to the insurance carrier, but we also reserve the right to supplement (add on more) if/when we find more damages, as the scope of work (labor and materials) has now changed.

Many insurance carriers will lead with “go ahead and supplement” the difference so they can get out of actually inspecting and creating/building a real estimate — which is wrong. Insurance carriers must provide an assessment of all damages on their own / for their own reporting.

Know Your Rights — Florida Law

Florida Statute § 627.70131

Claim Response Deadlines & Estimate Requirements

  • 7-Day Copy Rule § 627.70131(3)(e): The carrier must send you a copy of the detailed estimate within 7 days of it being generated.
  • Mandatory Record Logs § 627.70131(4): The carrier must log and maintain claim records, including a log of every adjuster who touched your claim.
  • Explanation of Alterations: If a desk adjuster changes the field adjuster’s assessment, the carrier must give you a written explanation.
Florida Statute § 627.7142

Homeowner Claims Bill of Rights

Gives you the right to receive a copy of the detailed estimate within 7 days.

Florida Administrative Code Rule 69B-220.201

Adjuster Code of Ethics

Field & desk adjusters must give an honest, accurate and fair assessment — without hiding or manipulating items.

What to Do If They Delay

  • Send a written request citing Fla. Stat. § 627.70131(3)(e) — the 7-day copy rule.
  • Demand the line-item version — the itemized, Xactimate-format estimate with exact measurements, material quantities and unit pricing. Not a one-page summary.
Provided by P1Mitigators™ (Jacksonville, FL) for informational purposes only — this is not legal advice. Always confirm your deductible, supplement and recoverable depreciation details directly with your insurance carrier. Questions? Call P1Mitigators at (904) 891-8435.