How to Find Building Codes in Your Area

Building code data has never been automated

Building codes automated - for the first time ever

Key pieces of information that need to be obtained for the average roof claim such as roofing codes, local tax rates and local permit fees still require a phone call to a local municipality to gather accurate information. That costs millions of hours per year in wasted time for adjusters, contractors and municipal employees. In the era of data and APIs, this type of inefficiency is incomprehensible and a major problem. It is a result of underinvestment in information digitization by local municipal governments throughout the US over the last twenty years.

The gap in readily available data leads to trust issues, increased settlement times, increased loss costs and less productive employees. It also creates frustration amongst contractors and adjusters who generally lack the time and training needed to do research that most of them do not want to do anyways.

With the revolution in digital automation of roofing data and roofing codes now upon us, claims departments can enjoy annual savings of tens of millions of dollars in both loss costs and loss adjustment expenses. Today it is more important than ever for homeowners, insurers, and property adjusters to consider adopting better tools and practices to counter the twin adverse trends of rising catastrophic storms and increasing roof labor and materials costs.

What is the cost of the lack of technology?

Wasted time is wasted money

According to the Insurance Information Institute, annual homeowners’ losses in 2018 were around $55 billion dollars, while from 2013-2017, annual wind and hail damage accounted for just over 30% of all residential homeowner’s losses leading to homeowners losses from catastrophic damage of approximately $19 billion. According to the Insurance Institute for Business and Home Safety (IBHS), roof-related damage is responsible on average for an estimated 70-90 percent of total insured residential catastrophic losses. When using historical averages, a reasonable estimate for average annual roof losses is between $12.3 billion and $15.8 billion.

Despite huge investments in insurance technology over the last five years, multiple components of both the underwriting and claims processes in property insurance remain stuck in manual gear with uncertainties about how and when they will ever be automated. One of the most glaring such problems is processing roofing claims where local jurisdiction and codes are administered by municipalities that either cannot afford to make their data accessible to the public or do not know how to do so effectively. The net result of this underinvestment is additional adjustment costs borne by the insurers as their adjusters and external contractors go back and forth endlessly to determine the right jurisdiction, roofing codes, and payment amounts.

Finally, there is an easier way now available for both insurers and their partners to streamline the process, ensure that it accounts for local laws and ordinances, and achieve both lower loss costs and lower adjustment costs.

The negative effects of a manual process

Current information available through widely distributed estimating systems does not go far enough to provide key data needed to create an efficient and streamlined roofing claims process for both adjusters and contractors.

Hidden roofing codes, unknown jurisdictional authorities, complex manufacturer specifications, and numerous local tax rates and permit fees all contribute to inefficient processing of roof claims. Online municipal information is often outdated or non- existent which means municipalities have to be called to get accurate information. There is also no guarantee that the information received from a local municipality is accurate either.

Time

When you're working with outdated processes, the time it takes to get what you need to move forward with your roofing project and claim is extremely frustrating.

Without updating your technology there is no way around this process. Even if you work within one neighborhood, there is research required to verify the jurisdiction and to verify that there are no changes within the local roofing codes.

Money

The longer each code pull takes, the more money is being left on the table.

Not only are you dealing with the cost from the time it takes for someone to do the work, you are also losing out on moving the project forward and putting money in your pocket.

Trust

Key stakeholders need to have a certain amount of trust with everyone involved with the claim process. Anyone involved in the industry knows how many different rules & regulations there are when a new claim comes through.

You need to make sure every line item claimed is backed up with documentation and without the data, there is no way to determine between fact & fraud.

Productivity

When you pull codes manually you don't just lose out on productivity with the time it takes to obtain the codes.

You also begin to lose employee productivity due to frustrations that employees may have. Finding codes can sometimes be a tough process and when an inevitable error occurs you need to spend time going back to research the correct codes.

Friction

Without having automated, accurate reports, contractors can feel taken advantage of when they try to justify line items.

This creates underlying angst between the people involved in doing the work and the people processing the claims. Having quick accurate information can help prevent this from ever happening.

Simplifying roofing code research

With savings in loss costs and loss adjustment expenses combined, the homeowners insurance industry could save over $1 billion annually while simultaneously helping their adjusters and contractor partners avoid frustration, save time, get clear answers and save out on recurrent overpayments due to systematic errors in code identification and managed services implementation.

By digitizing the following key data for 28,547 municipalities in the United States, OneClick Code is pioneering automated roofing code identification and permitting processes:

Roofing codes
Municipal jurisdiction authority
Material tax
Manufacturer specifications

The resultant data set eliminates millions of hours spent by adjusters and contractors required in the claims process by putting the information where it belongs: at the user’s fingertips.

Claims departments responsible for settling roofing claims can enjoy enormous potential loss adjustment expense reductions and loss cost savings through quickly considering a very simple set of questions:

How many roof claims do we settle on average each year?
What percentage of those claims require roofing code research
and review of contractor estimates?
What is the average time required by an adjuster to research roofing codes and review contractor estimates?
What is our average adjuster hourly pay rate?

The process to research the roofing codes and review contractor estimates is more involved than it may seem, including but not limited to the following steps:

Reviewing supplement
Identifying jurisdiction
Searching for roofing codes
Finding the municipality phone number
Recording these actions in a claims log
Adding line items specific to code
Calling the contractor to discuss approved items
Reviewing and processing payment
Downloading and uploading related information

Altogether this typically requires just shy of 120 minutes (two hours) of the adjuster’s time. Moreover if there is a supplemental request by the contractor and it is denied in full or in part it may be requested again. Such an additional request can add anywhere from 30 to 60 minutes to the process each time an adjuster reopens a claim to review a supplemental request and it is not uncommon for this process to repeat three or four more times after the initial request. Associated labor costs aside, there is no real measure for the amount of frustration experienced by the adjuster or contractor in such a process. To fully appreciate that frustration, we recommend trying to work tomorrow without your mobile phone or computer.

Using a data driven solution instead, this entire initial process takes less than five minutes and any resubmission less than one minute resulting in hours of savings each time. It also eliminates or greatly reduces the frustration experienced by the adjuster and contractor during the initial submission and any subsequent reopening by the adjuster. Most importantly, a data driven approach provides defensibility for the position taken, eliminating ambiguity and underpinning acceptance by all stakeholders. Such clarity increases the fidelity of the indemnity process and by definition reduces the possibility of fraud.

Data sourcing processes should be designed around three key values/principals:

RELEVANT
Related to settling roofing claims

RELIABLE
Straightforward answers to the most commonly asked and important questions (such as whether a local code requires a roof to include drip edge, valley liner, or iced water shield in eaves)

PRACTICAL
Updated consistently to ensure accuracy

OneClick Code targets municipalities based on what the Census Bureau calls CBSA’s (Core Based Statistical Areas). A CBSA is a U.S. geographic area defined by the Office of Management and Budget (OMB) that consists of one or more counties (or equivalents) anchored by an urban center of at least 10,000 people, plus adjacent counties that are socioeconomically tied to the urban center by commuting. 95% of the US population lives within 919 CBSA’s which encompasses 1,811 Counties. Within those counties are a further 28,547 local municipalities. Of the 28,547 municipalities, 12,593 issue their own permits. The remaining municipalities require permits, however they submit to the Jurisdictional Authority of an adjacent Municipality or County to obtain those permits. Additionally, municipalities may choose to outsource permit processing to third-party private companies. OneClick Code has developed a patented process for enabling the geolocation of an address in its geographically defined Jurisdiction of Authority in order to ensure data accuracy.

OneClick Code personnel contact each of the 12,593 permit issuing municipalities on an annual basis or semi-annual basis to collect and verify roofing code and sales tax data for digitization involving at least 3,000 different types of documents. Anytime there is a major storm (hurricane, severe storm, etc.), OneClick Code calls the local municipalities within 72 hours to ensure codes are updated for the ensuing claims process.

When working to find the correct sales tax estimation, it is important to know that there are often multiple rates per zip code, county, and/or city. Determining tax rates based solely on zip codes will result in inaccuracies. To ensure accuracy, it is necessary to pull the sales tax information based on an address’ geolocated latitude and longitude, and not simply the zip code or the city which can lead to incorrect input rates and a possible notice from the local tax collector.

At the core of OneClick’s patent pending building code solution is determining the correct municipal jurisdiction, i.e. given a US postal address, what local government has legal authority over that property. There are more than 40,000 individual jurisdictions within the US, each with a varying degree of legal authority. Determining which jurisdiction has authority for a particular address involves a two-step approach.

The first step being to geocode a particular address, where a precise latitude and longitude is assigned. Jurisdictional boundaries are represented as shapes on a map. Provided a latitude and longitude coordinate, the jurisdiction(s), or shape(s), that contain(s) the coordinate can be assessed.
The second step is to determine which jurisdiction that contains the property has legal authority to adopt and enforce building codes. This is a manual process consisting of various levels of communication with each jurisdiction throughout the country while taking into consideration the various nuances each state or municipality might have. This communication entails deciphering if each jurisdiction adopts and enforces building codes or if another jurisdiction has the authority to do so.

For example, does a particular city enforce building codes within its city limits or does the county that houses the city enforce the codes?
Additionally, situations may arise where a municipality’s building code does not require something yet the code also states a manufacturer’s specifications take precedence. In cases like this OneClick provides the ability to select a specific manufacturer and product line in order to determine the final requirements.

As we continue to collect building codes throughout the US accuracy and data integrity remain our top priorities. Given the unique nature of the data OneClick collects, software was developed in-house in order to effectively and efficiently gather this information. This bespoke application helps to prevent basic errors as well as providing verification for certain contact data points. In addition, when collected data is flagged as potentially erroneous, it enters into a review process where a senior building code analyst confirms the information before publication.

OneClick Code has gathered and maintains the only database containing this information. Each municipality is contacted at least once per year to gather or confirm pertinent contact and building code information.
Severe storms are also tracked by OneClick Code and any municipality that is affected by a storm is contacted within 72 hours of the storm to verify any and all contact and code information.
Defensibility is key to OneClick’s success such that during the data collection process OneClick attempts to gather verifiable evidence from each municipality backing up certain code items, in particular the requirement of an ice barrier.

In the last two decades, the combination of the rapid rise in severe convective storm (SCS) frequency and severity and skyrocketing roofing costs have created a toxic environment that is punishing homeowners and property insurers’ alike.

Between 2001 and 2017, there was a 7.5 percent per annum rise in claim severity and 3.3 percent per annum rise in frequency that combined to produce a growth of total loss, or SCS claims inflation, of 11 percent.
Sales among privately held roofing contractors increased 13.5 percent and 15 percent in 2017 and 2016, respectively while the average profit margin for roofing contractors grew 4 percent annually from May 2014 to May 2018.

Incredibly in 2022, no one in the roofing value chain can confidently answer how much it should precisely cost to replace a roof. Below we highlight a hypothetical example of where an incorrect set of roof data inputs can swing the claim payout by 21%. Perhaps most astonishing in this example is the fact that the payment could be wrong in either direction, i.e. the insurer may end up paying too much or too little based on the data as depicted.

How data is bringing roof adjusting into the 21st century