How to Work Effectively with Insurance Adjusters on HVAC Claims

When an HVAC loss occurs — storm damage to rooftop units in Houston, a compressor burnout in Miami, or vandalism to a packaged rooftop unit in Los Angeles — the way you interact with the insurer’s adjuster can determine whether your client’s claim is paid quickly and for the right amount. This guide, written for HVAC contractors operating in the USA (with specific, practical tips for Texas, Florida and California markets), explains how to prepare, negotiate, and document HVAC claims to maximize recovery while avoiding common pitfalls.

Quick overview: why adjuster relations matter

• Adjusters control scope and settlement amounts. Their inspection, estimates, and depreciation calculations largely determine what the carrier pays.
• HVAC-specific knowledge closes gaps. Many adjusters are generalists; contractors who explain system specifics, code upgrades, and manufacturer constraints can secure fairer settlements.
• Documentation reduces disputes and litigation. Complete, timely evidence shortens the cycle and increases recoveries.

Typical costs and price benchmarks (U.S. HVAC market)

Knowing realistic replacement and repair ranges gives you leverage in discussions.

• Central AC replacement (residential): $3,500 – $8,500 depending on tonnage and efficiency. Source: HomeAdvisor/Angi (https://www.angi.com).
• Commercial rooftop unit (RTU) replacement: $8,000 – $35,000+ depending on tonnage, single vs. multi-split, and curb requirements. Source: HomeAdvisor/Angi (https://www.angi.com).
• Average small-business HVAC contractor insurance costs: General liability for HVAC contractors often ranges from $700–$2,500/year, depending on payroll, revenue, and state. Source: Insureon (https://www.insureon.com/small-business-insurance/hvac-contractors).
• Typical claims administrator names you’ll encounter: Sedgwick and Crawford & Company are among the large third-party administrators often assigned by carriers.

References:

• Insureon — HVAC contractor insurance guidance: https://www.insureon.com/small-business-insurance/hvac-contractors
• Angi (HomeAdvisor cost guides) — HVAC installation and replacement costs: https://www.angi.com

Before the adjuster arrives: prepare like a pro

1. Secure the scene and preserve evidence.
   • Photograph serial numbers, model/serial plate, control wiring, and full-system photos from multiple angles.
   • Save maintenance records, service logs, and invoices that show age and prior repairs.
2. Create a pre-inspection packet (digital + hard copy).
   • Job sheet with client contact, property address, date/time of loss.
   • Equipment schedule: make/model/serial, original install date, capacity (tons), and last maintenance.
   • Estimate using your standard software and a materials list.
3. Understand the policy basis: RCV vs ACV vs Replacement.
   • Residential owner policies often pay Actual Cash Value (ACV) first (depreciated), then Replacement Cost Value (RCV) after proof of repair/replacement.
   • Commercial policies may differ — confirm limits and endorsements.
4. Get multiple vendor quotes for high-value items.
   • For RTUs > $15k, provide 2–3 competitive quotes to avoid lowball valuations.

During the inspection: tactics that win claims

• Be present and cooperative. Introduce yourself as the contractor, not the public adjuster. Offer to explain technical details.
• Lead with facts, not opinions. Demonstrate cause of loss (e.g., lightning surge, wind-blown debris) with photos and instrumentation where possible (multimeter logs, pressure readings).
• Point out code and efficiency upgrades. If local code (e.g., Title 24 in California or local Miami-Dade code) requires an upgrade, explain incremental cost and cite code section.
• Use manufacturer pricing and OEM parts lists. Present line-item manufacturer MSRP or distributor quote when arguing for specific part pricing.
• Document functional loss. If unit runs but with reduced capacity or high refrigerant loss, record load test numbers and explain long-term performance/efficiency loss.

Common adjuster arguments and rebuttals

• Argument: “Pre-existing wear caused failure.”
  Rebuttal: Provide recent maintenance records, a failure analysis, or evidence of acute triggering event (storm photos, meter spike).

• Argument: “We’ll only pay depreciation/ACV.”
  Rebuttal: Show invoice for replacement and request RCV once the work is complete. Cite policy language for RCV or ordinance & law coverage for code upgrades.

• Argument: “Material/labor pricing is inflated.”
  Rebuttal: Provide competitive bids, manufacturer quotes, and local market pricing (e.g., Los Angeles RTU market or Houston rooftop crane fees).

Table: Adjuster Expectations vs. Contractor Deliverables

Handling estimate software and supplements

• Adjusters commonly use Xactimate or Symbility. If your invoice deviates, map line items clearly.
• Submit supplements promptly with photos and explanation for additional scope discovered after removal.
• Keep a change-order log and get signed acceptance for concealed conditions (corrosion, asbestos, duct rot).

Money, timelines, and recovery strategies

• Progress draws: For large commercial replacements, negotiate interim draws (e.g., 50% on material, 40% on installation, 10% on final).
• Depreciation releases: For RCV claims, submit paid invoices and a demand for depreciation within the carrier’s required timeframe (typically 30–60 days).
• Subrogation: If a third party caused the loss (defective rooftop curb installed by GC, vandalism, or vehicle collision), document for potential subrogation. See Subrogation 101 for HVAC Firms: Recovering Costs After Third-Party Fault.

When to escalate or involve counsel

• If the carrier denies coverage or lowballs despite strong evidence, consider:
  • Requesting appraisal or independent engineer review.
  • Filing a demand letter and preparing for litigation. See When to Hire Counsel: Litigation vs Settlement Strategies for HVAC Insurance Claims.
• Use mediation as a cost-effective alternative for disputes under $50,000 — see ADR options: Mediation and Alternative Dispute Resolution for HVAC Insurance Disputes.

Practical scripts and documentation checklist

• Sample opening to adjuster: “Hi, I’m [Name] with [Company]. I installed/maintained this system and will walk you through the failure evidence, serial plate, service history, and competitive replacement quotes. Can I share our pre-inspection packet?”
• Essential attachments to submit within 48 hours:
  • Photos (wide, close-up, serial plate)
  • Service history and invoices (last 3 years)
  • Manufacturer plate/spec sheet
  • Itemized estimate and 2–3 vendor quotes for high-cost items
  • Structural/cost impacts (curb, crane, electrical upgrades)

Avoid these common pitfalls

• Don’t delay documentation — adjusters cite “lack of proof” if evidence arrives late.
• Don’t accept verbal denials; get coverage position and reason in writing.
• Don’t rely solely on oral promises about supplements — confirm in email.

Final checklist before invoicing

• Confirm carrier authorization or documented coverage position.
• Obtain signed change orders for extra scope.
• Submit final invoice, paid receipts (for RCV release), and a request for depreciation recovery.
• If pursuing subrogation, preserve chain of custody for evidence and liaise with the carrier’s subrogation unit.

Useful external resources

• Insureon HVAC insurance guide: https://www.insureon.com/small-business-insurance/hvac-contractors
• Angi (HomeAdvisor) HVAC cost guides: https://www.angi.com

Internal resources for deeper reading:

• Step-by-Step Claims Handling for HVAC Contractors: What to Do After an Accident or Theft
• Subrogation 101 for HVAC Firms: Recovering Costs After Third-Party Fault
• When to Hire Counsel: Litigation vs Settlement Strategies for HVAC Insurance Claims

Working effectively with adjusters is a mix of technical clarity, strong documentation, and smart negotiation. For HVAC contractors in Houston, Miami, Los Angeles or nationwide, the right preparation turns adjuster visits from risky unknowns into predictable outcomes that protect your margins and your client relationships.