FORTIFIED Roof ROI Calculator for Commercial Property
A FORTIFIED roof costs more than a standard one, and the credit meant to offset it is set in each carrier's filing. Enter the contractor's bid and the credit you were quoted, and see what the credit has to be for the roof to pay back inside your hold.
Condo board on the Alabama Gulf Coast? How Gulf Shores and Orange Beach associations think about FORTIFIED. Own a coastal hotel? Gulf Coast hotel insurance.
- The break-even credit for payback inside your hold
- Payback and NPV at the credit you were quoted
- Value sensitivity at your cap rate, labeled as modelled
- How the case moves if the quote moves
No email required to see your results. Nothing is transmitted until you ask.
Step one
Your roof quote and your carrier's credit
Every field is yours to fill in. Nothing is prefilled, because the credit is whatever your carrier quotes in writing and the roof cost is whatever your contractor bids. It all runs in your browser, with no account.
Optional: if the carrier also offers a lower deductible
A carrier may offer a deductible adjustment alongside the credit. Enter how much less you would retain in one damaging storm, and your own view of the odds. The result counts that expected value toward payback and NPV, but not toward NOI or value.
Add the roof cost, the premium, and your hold period.
Those three numbers are enough to show the break-even credit: the discount your carrier would have to give you for the upgrade to pay for itself within your hold. Add the quoted credit to see payback and NPV.
What credit does a carrier give for a FORTIFIED commercial roof?
It depends on the carrier. Each insurer files its own rating plan, and the credit can vary by designation (Roof, Silver or Gold), by whether it applies to the wind portion of the premium or the whole premium, and by the property. The calculator starts empty because no typical number would be accurate.
Get the credit in writing, by designation, on your actual schedule, before the roof contract is signed. Ask what premium it applies to, whether it is a credit on the wind premium or the total, and whether a deductible adjustment comes with it. Then run those numbers here.
Does Alabama require a credit for FORTIFIED commercial property?
Alabama requires insurers to file one. Ala. Code §§ 27-31D-1 and 27-31D-2, as amended by Act 2015-313, direct insurers to submit an actuarially justified rating plan for owners who build or retrofit an insurable property to the listed standards, including the IBHS Fortified Commercial Standard. Section 27-31D-3 defines insurable property to include commercial property.
The adjustment applies only to policies with wind coverage. It may apply to the wind portion of the premium, or to the total premium if the insurer does not separate wind out, and it applies only to the improved property. Insurers may also offer deductible adjustments. The statute does not set a percentage, and it does not require the same adjustment for code-built property as for FORTIFIED property.
The coverage language reaches owners in “any county contiguous to the Gulf of Mexico and Mobile Bay,” which in Alabama means Baldwin and Mobile. The Act took effect for commercial property there at renewals on or after January 1, 2016. It also sets a January 1, 2018 start for the state's other counties, but the text leaves unclear how far the requirement reaches inland, so ask the carrier what it files for your county. This summarizes the Act as enacted in 2015; confirm the current codified text with counsel before relying on it.
What did the Alabama Department of Insurance say about the size of the credit?
On December 23, 2016, the Alabama Department of Insurance announced Bulletin 2016-07, describing wind mitigation discounts for FORTIFIED residential and commercial structures of 35% to 60% on the hurricane portion of the premium and 20% to 35% on the other wind portion.
Treat it as a 2016 range from a press release. It is not a mandated amount, and it applies to portions of the wind premium, not the whole policy. We could not retrieve the bulletin text itself, and what your carrier files today is what counts. None of these figures prefill the calculator.
Which commercial buildings can earn a FORTIFIED designation?
IBHS FORTIFIED Commercial has three levels. Roof protects the roof system. Silver adds protection for vulnerable and often overlooked components. Gold requires the entire structure to be tied together in a continuous load path. Eligible building types include multifamily buildings not governed by the International Residential Code, hotels, retail, franchise locations, schools and mixed-use properties.
IBHS also runs FORTIFIED Multifamily, which covers new construction, renovation and re-roofing. For a Gulf Coast association, the Gulf Shores and Orange Beach condo page covers where FORTIFIED fits in the rest of the program.
What does this calculator count, and what does it leave out?
It counts the premium credit you enter and, if you add it, the expected value of a lower deductible at your own odds. Only the premium credit changes NOI, so only the premium credit feeds the value sensitivity (annual NOI change divided by your cap rate). That figure is a modelled sensitivity. It is not an appraisal, and a buyer or lender may weigh a roof very differently.
It leaves out fewer or smaller roof claims, easier renewals and any change to rents or occupancy. It assumes the credit holds for the whole hold on today's premium, which no carrier promises. The cost field is the extra cost over a standard replacement, so enter it as the difference between two bids, not the whole re-roof. For the deductible side of a wind program, use the wind deductible calculator and read how a wind deductible buy-down is built.
One funding note. The Strengthen Alabama Homes grant program covers owner-occupied, single-family primary residences, so it does not apply to commercial property (ALDOI Rule 482-1-159-.02).
What does the deductible retain?
A percentage wind deductible applies per location, to insured value. See what one storm retains across your schedule.
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Named storm and hail capacity, deductible buy-downs, and parametric structures for coastal and hail-belt schedules.
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The calculator tests a quote. Getting that quote in writing, by designation, from the carriers that write your roof and wind takes more work. Send the schedule over, or just the renewal date.
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