How Insurance Estimates Work: Xactimate Explained for Homeowners
What is Xactimate?
Xactimate is the industry-standard estimating software used by insurance companies, contractors, and public adjusters to price repair work. It contains a database of thousands of line items covering every type of construction material and labor task. Each line item has a price based on local market rates that are updated monthly.
When your adjuster writes an estimate, they are selecting line items from this database and entering quantities.
How to read your estimate
Your Xactimate estimate is organized by room or area. Within each room, you will see individual line items with a description, quantity (measured in square feet, linear feet, or each), unit price, and total. For example, you might see 'Remove and replace drywall, 1/2 inch, 150 SF, $2.
85/SF, $427. 50. ' Each line item represents a specific task or material in the repair.
What commonly gets left out
Adjusters build estimates by selecting which line items to include. Items can be left out intentionally or accidentally. Common omissions include overhead and profitWhat Is Overhead & Profit (O&P) in Insurance Claims?Overhead and Profit (O&P) is a standard markup added to insurance repair estimates when a project requires three or more different types of contrac...
Read more →, contents manipulation (moving furniture), appliance disconnectAppliance Disconnect and Reconnect Labor: Is It in Your Estimate?When your kitchen or laundry area needs repairs, appliances must be disconnected, moved, and reconnected. This labor is a standard line item in Xac...
Read more →/reconnect, texture matchingDrywall Texture Matching: Why Your Repaired Walls Should Look RightAfter drywall is repaired or replaced, the texture on the new section needs to match the rest of the wall or ceiling. Texture matching is a skilled...
Read more →, full-room paintingFull-Room Painting After Repairs: Why Patching Is Not EnoughWhen walls are repaired after water damage, fire, or other covered losses, the repainted patch rarely matches the surrounding wall. Most insurance ...
Read more →, subfloor replacementSubfloor Replacement After Water Damage: What You Need to KnowWhen water saturates your flooring, it often damages the subfloor underneath. Subfloor replacement is one of the most commonly omitted items in wat...
Read more →, and code upgradesBuilding Code Upgrades in Insurance ClaimsWhen your home is opened up for repairs, existing construction that does not meet current building codes may need to be upgraded. This is covered u...
Read more →.
If a task is needed for the repair but has no line item in the estimate, it is missing and needs to be added.
How pricing works
Xactimate prices are based on local market data and are updated regularly. They include material cost and labor cost for each line item. The prices represent a fair market rate for the work in your specific area.
If a contractor tells you the Xactimate price is too low for a particular item, they may be right, Xactimate prices do not always keep up with rapidly changing material costs or specialized labor markets.
What to do
Ask your adjuster for a copy of the full Xactimate estimate. Read through each line item and compare it to the actual scope of work needed. Look for missing items by walking through the damaged area room by room and listing everything that needs to be done.
If items are missing, ask your adjuster to add them. If you are not comfortable reviewing the estimate yourself, a public adjusterWhen Should You Hire a Public Adjuster for Your Insurance Claim?A public adjuster is a licensed professional who represents you, the homeowner, in your insurance claim. Unlike the company adjuster who works for ...
Read more → or experienced contractor can review it for you.
See how this applies to your property
Upload photos of your damage and get a detailed analysis showing exactly where your estimate may fall short.