Xactimate Water Damage Estimates Explained

The Document That Decides What You Get Paid

Xactimate is estimating software from Verisk, and it is the de facto standard across property insurance. Most carriers write water damage claims in it, most restoration contractors estimate in it, and the document you are handed after the adjuster's visit is almost certainly an Xactimate export.

Which makes it worth understanding, because the estimate is the settlement. Whatever is not in it does not get paid, and homeowners routinely accept a scope with items simply missing rather than wrong.

How the Pricing Works

Xactimate is not a contractor's opinion of price — it is a database. Verisk publishes regional price lists updated monthly and specific to your ZIP code, covering material and labour costs for thousands of individual tasks.

Each task is a line item with a code, a unit of measure, and a unit price. The estimate multiplies quantity by unit price and totals it. So the argument is almost never about the *rate* — the rate is the published rate for your area this month. The argument is about quantity and inclusion: how many square feet, how many days, and which line items appear at all.

That reframing is the most useful thing on this page. Do not fight the prices. Fight the scope.

Line Items You Should See on a Water Claim

Equipment lines are usually the largest part of a mitigation estimate, and they are per unit, per day — so the two numbers that matter are how many machines and how many days. Check them against the affected area and the drying class assigned.

What Gets Left Out — Check for These

This is where homeowners lose money quietly. Common omissions:

• Detach and reset — toilets, vanities, cabinets, baseboards and door casings have to come off and go back. These are separate line items and are frequently missing.
• Contents manipulation — moving and protecting your belongings, versus a full pack-out
• Antimicrobial application
• Containment and PPE on any Category 2 or 3 loss
• HEPA air scrubbing, and negative air where remediation is involved
• Debris removal and disposal, including dump fees
• Floor protection on the path crews walk
• Final cleaning after reconstruction
• Sales tax on materials
• Matching and continuity of finish — where a discontinued floor or tile means the repair cannot stop at the damaged area

Take your contractor's estimate and the adjuster's estimate and compare them line by line, not total to total. The gap is almost always a handful of missing items rather than a pricing disagreement.

Overhead and Profit — the "Ten and Ten"

O&P is 10% overhead plus 10% profit, the margin a general contractor earns for coordinating a job. On a water claim it can be a meaningful sum, and insurers do not always include it.

The widely used industry rule of thumb: if the job requires three or more trades, general contractor coordination is reasonably necessary and O&P should be paid. A water loss touching plumbing, drywall, painting, flooring and electrical clears that bar comfortably.

Be clear-eyed about its status, though: the three-trade rule is an informal convention, not law. It appears in no standard policy language, most states do not treat it as the legal test, and Verisk — which makes Xactimate — does not endorse it. It is widely used and widely criticised as arbitrary.

That does not make it useless. "This job needs three or more trades, so it needs a general contractor, so O&P applies" is a recognised argument that adjusters deal with routinely, and it is a reasonable one to make in writing. Just do not expect it to be treated as a rule you can enforce.

ACV, RCV, and the Cheque You Might Not Know You're Owed

On an RCV policy the sequence is: the carrier pays ACV first, you complete the repairs, you submit invoices, and the carrier releases the recoverable depreciation.

A lot of homeowners never claim that second payment. They receive the first cheque, assume it is the settlement, and leave the balance with the insurer. If your estimate shows recoverable depreciation, that is money you are owed on completion — put a reminder in your calendar.

Note also that most policies impose a deadline for completing repairs and claiming it, commonly a year or two from the loss.

Disputing or Supplementing

1. 1Ask for the complete line-item estimate, not the summary page. You want every line, with quantities and unit prices.
2. 2Have your contractor write their own Xactimate estimate. Two documents in the same format compare cleanly, and this is the single most effective step.
3. 3Submit a supplement — a written request to add missing scope, with photographs, moisture readings and the contractor's estimate attached. Supplements are routine, not confrontational, and adjusters process them constantly.
4. 4Escalate if it stalls — a supervisor, then the appraisal clause in your policy, which is a binding process where each side hires an appraiser and an umpire resolves the difference. It is faster and cheaper than litigation and exists precisely for scope disputes.
5. 5A public adjuster works for you rather than the carrier, typically for a percentage of the settlement. Worth considering on large or stalled claims, less so on small ones.

If the claim is denied outright rather than underpaid, that is a different process. For getting the most out of a claim being paid, see maximising your settlement.

Bottom Line

Xactimate prices are regional published rates and are rarely worth arguing about — the money is in scope. Request the full line-item estimate, have your own contractor write one in the same format, compare line by line, and look specifically for detach-and-reset, containment, disposal, tax and matching. Then check whether recoverable depreciation is being withheld, and diary the date you can claim it.