Pros and cons of Xactimate

Xactimate is one of the most commonly used estimating tools in the insurance industry.

Most insurance adjusters have used Xactimate to create cost estimates. It’s accepted everywhere for several reasons, but it also has flaws. How useful is it actually?

An overview of Xactimate

Xactimate was created to give insurers a tool to make their claim estimating easy. Some contractors also use it, especially if they work with multiple insurance companies.

When someone submits a claim, an adjuster using this program can generate a scope of work in a much shorter time than usual. The software can be accessed from several different platforms and allows adjusters to gather loss information and estimate project costs. It’s relatively easy to use and doesn’t require much training to start.

The pros

Xactimate has broad backing from insurance companies. Its widespread use means most contractors and adjusters are used to it. There is a huge database of possible line items to reference, and the program communicates well with other platforms that insurers regularly use.

It’s also good for finding industry-standard, average rates for work and materials. The pricing is regularly updated with new estimates.

The cons

There are some downsides to using this software, though. It’s very dependent on the correct pricing information being available and the correct line items being chosen, and training can vary, leading to inaccurate estimates.

Pricing can also be significantly off depending on factors like supply shocks, local ordinances, historical homes, or high-value areas. Labor and materials fluctuate more than the platform can adjust for, and that can lead to inaccurate estimates—usually on the low side, not the high side.

Xactimate is useful, but something like lump sum pricing is a better match for most projects. That’s why we use lump sum here at Palladium Roofing. Accurate pricing and realistic scope of work are the best solutions for homeowners, insurance companies, and contractors.