Can You Get Recoverable Depreciation While a Supplement Is Still Open?

You finished the roof. The homeowner is happy. Your crew has moved on to the next job. But thousands of dollars are still sitting inside the insurance claim because one or two supplemental items haven’t been approved yet. That creates a frustrating situation: work that has already been completed is effectively waiting on work that is still under review.

A depreciation release form functions as a practical operational link. It gives the carrier documentation supporting the release of recoverable depreciation associated with completed work.

Imagine the approved roof scope is $18,000 and the carrier is holding $6,500 in recoverable depreciation. The roof is complete, but the contractor has also submitted a $1,100 supplement for decking and code-related items. If the carrier treats the entire claim as one unresolved file, that $6,500 may remain outstanding while the $1,100 supplement is being reviewed.

The goal is to separate the completed, undisputed work from the supplemental items that are still being reviewed: “This work is complete and ready for depreciation release; these additional items remain open.”

How Recoverable Depreciation Works (The Gap Between ACV and RCV)

Most replacement-cost claims are not paid in one check. The carrier typically pays the Actual Cash Value first and holds back recoverable depreciation until the required work is completed and documented.

Instead, the payments take place in two clear stages:

• Actual Cash Value (ACV): The carrier initially pays the depreciated value of the covered property, based on factors such as age and condition. This first payment is the replacement cost less depreciation (and the homeowner’s deductible).

• Recoverable Depreciation: The withheld depreciation is generally released after the covered repairs are completed and the required documentation is submitted. The carrier generally releases recoverable depreciation after receiving documentation showing that the covered repairs were completed, subject to the terms of the policy and claim.

RCV - Depreciation = ACV

ACV + Recoverable Depreciation = RCV

Simplified illustration only. Deductibles, policy limits, prior payments, supplements, and other claim-specific adjustments can affect the actual payment calculation.

When One Open Item Holds Up the Rest of the Claim

In the best scenario, you finish the work, submit the invoice, and then get the check for the recoverable depreciation. In practice, disagreements about extra materials, unforeseen decking repairs, or code upgrades often delay the entire payment process:

• Everything gets tied together: Some carriers or claim workflows may keep depreciation processing tied to unresolved supplement items.

• A small dispute can hold up a large payment: A small dispute over a $300 ridge cap supplement can delay the release of $8,000 in recoverable depreciation for work that has already been completed. Maybe the carrier agrees that the roof replacement is complete but is still reviewing a ridge-cap measurement, code item, or decking charge. From the contractor's perspective, those unresolved items shouldn't necessarily prevent payment on thousands of dollars of completed, undisputed work.

• The homeowner gets caught in the middle: From the homeowner’s perspective, the job looks finished when the crew leaves. An outstanding balance weeks later can be confusing—especially when the reason is an insurance item they may not fully understand.

The Purpose of a Depreciation Release Form

A depreciation release form clearly draws the distinction between the scope items that have been settled and supplemental items still being reviewed. It documents which portions of the approved scope have been completed and supports a request for the related recoverable depreciation to be released.

• It separates completed work from disputed work. The carrier can see which approved items have been completed without treating unresolved supplement items as settled.

• It supports a cleaner depreciation request. The contractor can document completion of the undisputed scope while the supplement continues through review.

• It creates a clearer paper trail. Everyone can see what has been completed, what has been invoiced, what has been paid, and what remains open.

Best Practices and Considerations Regarding the Language

Because the document deals with an active insurance claim, the language needs to be precise: 

• Don't promise payment: You must not promise or suggest that submitting the form will guarantee carrier approval or immediate payment. It should be presented simply as proof that the work has been completed and that the line items have been reconciled.

• Don't accidentally waive the supplement: Make it clear that releasing the depreciation for work that has been completed does not resolve or waive supplemental items that are still being reviewed by the adjuster.

• Document facts, not arguments: State what work was completed, what amount is being requested, and which supplemental items remain unresolved. The document should clarify the status of the claim, not try to pressure the adjuster into a decision.

When appropriate, the documentation should also make clear that the depreciation request relates only to completed work and is not intended to resolve or waive supplemental items that remain under review.

Carrier requirements vary by insurer, policy, and jurisdiction. Contractors should confirm the documentation required for each claim and avoid language that could unintentionally release or waive unresolved items.

Supplements, depreciation requests, collections, and carrier follow-up all compete for the same back-office time. When those processes fall behind, cash flow usually feels it first.

Veristra helps roofing contractors manage the administrative side of insurance restoration, from Xactimate estimating and supplement follow-up to accounts receivable and collections.

You build the roofs. We help keep the paperwork and money moving.