How often does Verisk update Xactimate pricing?

Verisk publishes price list updates monthly. Within that cycle, vendor-specific pricing updates nightly, hourly labor rates update monthly, and general line item prices update when market analysis warrants. The monthly release is the cadence operators should plan their template refreshes around. How many regions does Xactimate pricing cover? Xactimate covers 468 geographic regions across the United States and Canada, with pricing researched independently for each region. This is the reason the same line item can have meaningfully different prices in different markets — the published number is built from local research. How does Verisk decide what price to publish for a line item? Verisk uses cluster analysis on submitted price points across more than 50,000 providers and over 345,000 annual survey points. The methodology identifies the largest cluster of prices for a line item in a region and selects a representative point within that range. The published price reflects the most common recently submitted price. Why does my Xactimate price feel lower than my actual cost on some items? If the published price is consistently below your cost, you are likely either operating in a higher-cost niche than the cluster average, using a higher-quality material than the published reference, or carrying overhead that the published labor rate does not absorb. Each of these is a legitimate basis for a custom price modifier or a documented variance — not a reason to ignore the published price. Can I challenge a Verisk price if I think it is wrong for my market? Yes. Verisk accepts pricing feedback from contractors and uses contractor submissions as part of its survey input. Submitting documented evidence of a price discrepancy can influence the next monthly research cycle. Individual estimates can also include documented variances when the published price does not reflect the actual cost of the specific work.

What changed in Xactimate's 2026 labor efficiency update?

Verisk expanded the labor efficiency architecture from two models to three by adding the Large Restoration/Remodel option. The update was presented in February 2026 and is designed to bridge the gap between service-level work and full rebuild scenarios for mid-sized restoration jobs. When should I use the Large Restoration/Remodel labor efficiency model? Use it for mid-sized jobs that involve multiple trades, multi-week duration, and moderate coordination but do not reach the scale of a full rebuild. Common examples include partial kitchen rebuilds after water loss, multi-room fire cleanup, and large mold remediation projects. How much can the wrong labor efficiency model affect my estimate? Selecting the wrong efficiency model can shift the estimated labor on a job by roughly 10 to 25 percent depending on the scope. On a $30,000 estimate, that is $3,000 to $7,500 of labor either over- or under-stated. The model choice is a meaningful margin lever, not a minor technical detail. Do TPAs accept the new Large Restoration/Remodel model? Yes, but adoption is uneven during the early months after the release. Some reviewers accept the new tier without question, others challenge it. The best practice is to document the reasoning for the model selection in the estimate notes so the choice is defensible if questioned. Where can I learn more about the 2026 Xactimate labor efficiency update? Verisk has published webinar content covering the updated labor efficiencies architecture in detail. The on-demand webinar is the authoritative source for the methodology and selection criteria. Operator-level training providers have also begun including the new tier in their X1 curricula.

How many Xactimate certification levels are there?

There are three certification levels: Level 1 (Fundamentals), Level 2 (Proficiency / Power User), and Level 3 (Mastery). Each level builds on the previous one, but you do not have to take them in sequence — a user can pursue Level 2 without holding Level 1. What score is required to pass an Xactimate certification exam? The passing score is 70 percent. A current Xactimate license is required to take the exam. Once passed, the certification is valid for two years before renewal is required. How much does Xactimate certification training cost? Pricing varies by provider. Third-party providers commonly offer combined Level 1 and Level 2 training in the $650 range, with regional and seasonal variation. Verisk also offers training and exam options directly through its platform. For up-to-date pricing, check the Verisk training site or your preferred third-party provider. Which Xactimate certification level do my estimators need? For most restoration companies, Level 1 is the right baseline for anyone who touches an estimate, and Level 2 is the standard for daily estimators and project managers. Level 3 is appropriate primarily for large-loss commercial estimators or third-party estimating professionals. How often do I need to renew Xactimate certification? Certifications are valid for two years. Renewal requires re-testing at the same level. Plan the recertification cycle into your annual training budget and stagger renewals across team members to avoid bunching the workload.

What is Xactimate Sketch AR?

Sketch AR is the augmented-reality measurement and sketching feature in the Xactimate mobile app. It uses the device camera and motion sensors to capture room dimensions and produce a 2D sketch in the field, with optional 3D cutaway views. The output syncs to the cloud and is available on the desktop estimate immediately. How accurate is Sketch AR? Sketch AR is accurate enough for most residential interior measurements when conditions allow for clean camera tracking. For high-precision requirements (insurance disputes, large commercial losses), traditional measurement is still recommended as a verification step. Devices with LiDAR sensors typically produce cleaner results than camera-only devices. What kind of device do I need for Sketch AR? A modern tablet or phone with a good camera and motion sensors. iPads with LiDAR are particularly well-suited because the dedicated depth sensor improves tracking. Field teams should standardize on capable hardware rather than mixing devices that produce inconsistent results. Can Sketch AR replace traditional measurement entirely? For typical residential interior work in good conditions, Sketch AR can serve as the primary measurement method. For high-stakes jobs, large commercial spaces, dark or heavily damaged environments, or any situation that may end up in dispute, traditional measurement should still be used as either the primary method or a verification step. How long does it take to train field techs on Sketch AR? The technical training is short — most techs are productive within a single training session. The harder change is operational: standardizing the team on a mobile-first workflow rather than leaving it optional. Allow two to four weeks for the new workflow to become muscle memory across the team.

Should restoration salespeople use a written script verbatim?

The framework should be scripted; the delivery should be conversational. Reading a script word-for-word feels robotic and erodes trust. Memorizing the structure and language patterns and delivering them naturally is the goal. How do I train new restoration salespeople on these scripts? Role-play is the fastest training method. Pair new reps with senior staff for ride-alongs, then run weekly role-play sessions where new reps practice handling the toughest objections. Recording actual customer calls (with consent) and reviewing them as a team also accelerates learning. What is a reasonable close rate on residential restoration estimates? Well-trained residential restoration salespeople running emergency mitigation typically close 60-80% of first-on-scene appointments. Reconstruction-only estimates close at much lower rates, often 25-40%, because of the longer decision cycle. Should I quote prices over the phone? Generally no for restoration. Phone pricing without seeing the damage triggers price shopping and locks the rep into a number that may not match the actual scope. The phone goal is to book the on-site appointment, not to quote. How do I handle a homeowner who is getting multiple bids? Address the underlying concern (they want to make sure they're not being overcharged) by walking through your scope line-by-line, explaining what each item does, and offering to review competitor scopes side-by-side. Confidence in your scope and price usually wins more often than discounting.

How much does it cost to start a restoration business?

A realistic startup cost for a one-truck residential restoration company in 2026 ranges from $50,000 to $120,000. The major components are equipment ($20K-$40K), a truck ($25K-$45K), insurance ($8K-$15K first year), licensing and certifications ($2K-$5K), software ($3K-$6K), and working capital to bridge initial receivables ($15K-$30K). How do you start a restoration business? The compressed startup checklist: form an LLC, obtain state contractor license, secure general liability and pollution liability insurance plus workers' comp and commercial auto, complete IICRC WRT certification at minimum, purchase initial equipment package and a service vehicle, set up Xactimate subscription and basic accounting software, build initial referral relationships with local plumbers and insurance agents, establish a Google Business Profile and basic website, and begin marketing through Local Service Ads and direct outreach. How profitable is a restoration business? Healthy restoration companies run 8-15% net profit margin on revenue. Gross margins by service line range from 25-40% on reconstruction up to 50-65% on mold remediation. A well-run $2M restoration company should produce $160K-$300K in net profit. The most profitable operators tend to have strong commercial mix, disciplined supplement workflows, and tight job costing. What is the average revenue of a restoration company? Restoration company revenue ranges enormously. Single-truck residential operators typically run $400K-$1.2M. Established multi-truck residential companies $1.5M-$5M. Companies with significant commercial work or multiple service lines $5M-$25M. Multi-location operators and franchises $25M-$300M+. The industry median is around $1.5M-$2M. How long does it take to scale a restoration company? The typical path from startup to $5M revenue runs 5-10 years for organic growth. Faster growth is possible through acquisition, geographic expansion, or aggressive commercial business development. The most common stalling point is the $1.5M-$2M range, where the founder has to transition from doing the work to leading the team. Companies that successfully make that transition often double again in the following 3-5 years. Can you franchise a restoration business? Yes, the major restoration franchise groups (ServPro, ServiceMaster, BELFOR, Rainbow International, PuroClean, and others) all sell franchise territories. Franchise costs vary widely: initial franchise fees typically $40K-$75K, equipment and startup costs $100K-$300K, and ongoing royalties of 6-10% of revenue plus marketing fees. The franchise vs. independent decision depends on access to commercial work, brand recognition value in your market, and tolerance for ongoing royalty cost.

When should a restoration company hire its first salesperson?

Most restoration owners should add their first dedicated salesperson when their own selling capacity is becoming the growth constraint — typically when the company hits roughly $1.5M-$3M in revenue and the owner can no longer personally handle every estimate. Hiring earlier often means the owner has to manage someone they cannot afford; hiring later caps growth. How long does it take a new restoration salesperson to ramp? A well-onboarded residential rep usually reaches full productivity in 90-120 days. Commercial BD reps typically need 6-12 months to build the pipeline that produces consistent revenue. Companies that expect faster ramps usually see high attrition. Should we pay restoration salespeople on revenue or gross profit? Gross profit-based commission produces better behavioral outcomes (less discounting, better job selection) but requires accurate job costing that many restoration companies do not have. Revenue-based commission is simpler but creates incentive misalignment. Hybrid structures that adjust commission rate based on gross margin tier often work best. How do I prevent salespeople from over-promising on jobs? Strong handoff processes between sales and production, sales accountability for change orders and customer complaints, and compensation structures that include customer satisfaction or production margin metrics all reduce over-promising. Cultural emphasis from leadership on long-term reputation over short-term commission also matters. Do restoration sales contests actually work? Short-term contests can create useful spikes in activity (more appointments, faster follow-up) but should not replace consistent compensation structures. Contests that reward quality metrics (close rate, customer review scores) usually outperform contests that reward pure revenue.

What is a TPA in restoration?

A TPA (third-party administrator) is a company that manages claims on behalf of insurance carriers. In restoration, TPAs handle adjuster assignment, vendor selection, scope review, payment processing, and customer communication. Major restoration TPAs include Sedgwick, Crawford & Company, Contractor Connection, Code Blue, and CCMSI. How do you get on a carrier preferred vendor program? The application process typically requires: 3+ years in business, specific IICRC firm and individual certifications, higher insurance limits than standard, background-checked technicians, 24/7 dispatch capability, monthly KPI reporting, and signing a master service agreement that defines pricing concessions and performance standards. Applications take 60-180 days and often include facility audits and reference checks. Are TPA programs profitable for restoration companies? It depends on cost structure. TPA work typically pays 10-20% less than direct retail work due to pricing concessions, capped overhead and profit, and other restrictions. Companies with lean overhead and high operational discipline can run profitable TPA programs at high volume. Companies with high overhead burden often lose money on TPA jobs while believing they're profitable. What is an MSA in restoration? An MSA (Master Service Agreement) is the contract between a restoration contractor and a TPA, carrier, or commercial customer that governs the relationship — pricing schedules, territory, performance metrics, payment terms, insurance requirements, audit rights, and termination provisions. MSAs should be reviewed by an attorney with restoration industry experience before signing. What percentage of revenue should come from TPA work? Most healthy restoration operators target 30-50% of revenue from TPA and preferred vendor programs. Below that range, the company isn't leveraging program volume; above that range, the company is operationally captive to a few TPAs and vulnerable to program changes, pricing reductions, or termination. How do restoration vendor scorecards work? TPA performance scorecards typically measure response time (minutes to first contact, hours to on-site), customer satisfaction scores, cycle time (days from assignment to completion), scope variance and supplement approval rates, complaint rates, and quality scores from TPA file audits. Top-quartile performers receive disproportionate assignment volume; bottom-quartile performers face reduced assignments and eventual network termination.

How many objections does a typical restoration estimate include?

A typical residential restoration estimate includes 1-3 objections from the customer before signing. Estimates with zero objections often signal the customer is going to "think about it" silently and then go elsewhere — surfacing objections in the room is actually a sign of engagement. Should restoration salespeople memorize objection responses? Memorize the framework, not the words. Word-for-word memorized responses sound robotic. Practiced frameworks delivered conversationally land naturally and protect against improvisation under pressure. What is the most damaging objection-handling mistake? Discounting at the first hint of price resistance. The price objection is usually a value clarity question — answering it with a discount confirms that the original price was inflated and trains the customer to expect discounts on future work. How do I handle objections over the phone before the in-home visit? Most pricing and scope questions on the phone should be redirected to the in-home visit: "I want to give you an accurate answer, and the only way to do that is to actually see the damage. Can we get a project manager out today?" Quoting blind on the phone usually loses the job and the in-home opportunity simultaneously. When should I walk away from a customer rather than handle the objection? Walk away when the customer is asking for scope or pricing that compromises quality (e.g., "skip the dehumidifiers"), demanding discounts that put the job below cost, or signaling distrust that the rep cannot recover. Working unprofitable or unhappy customers damages the business.

How much should a water damage restoration company spend on marketing?

Most healthy restoration companies invest between 5% and 12% of revenue on marketing, with a higher share during the first three years while organic and referral channels are still being built. Companies relying primarily on paid acquisition often run closer to the higher end of that range. Are Google Local Service Ads worth it for water damage? For most water damage restoration companies in mid-sized and major metros, yes. LSAs typically produce a lower cost per lead than traditional Google Ads and the Google Guaranteed badge improves close rates on cold inbound calls. The qualifying process is the main barrier. What marketing channels work best for commercial water damage? Commercial water damage leans more on relationships, MSAs with property management firms, LinkedIn outreach, and association involvement than on paid search. Paid search still matters but a larger share of commercial pipeline comes from offline business development. How long does SEO take for a restoration company? Local SEO results — map pack visibility, branded search, and a handful of city service pages — typically begin to compound in 90-180 days. Building a competitive organic presence on the most valuable water damage keywords in a major metro often takes 12-24 months of consistent content and link building. Should a restoration company hire an agency or build marketing in-house? Companies under roughly $3M in revenue usually get more value from a specialized restoration marketing agency than from an in-house hire, because the talent pool of operators who understand both restoration and digital marketing is thin. Above $5M, an internal marketing leader paired with specialist agencies is often the best mix.

Category: The Restoration Operator’s Playbook

Operational intelligence for restoration owners, GMs, and senior PMs. How the industry’s best companies are thinking about AI, talent, mitigation-to-rebuild handoffs, financial discipline, and end-in-mind operations through 2026 and beyond. Published by Tygart Media as industry intelligence — not marketing.

Xactimate Pricing Methodology: Verisk Research Explained
Xactimate is the most widely used estimating platform in property restoration, and the prices behind it are not invented in a back room. Verisk publishes a documented pricing research methodology that explains how every line item price is built, updated, and released. For restoration operators, understanding the methodology is the foundation of defending your estimates to TPAs, adjusters, and customers.

If you have not read the broader pricing context first, start with our restoration pricing and estimating master guide.

The Research Footprint

Verisk’s pricing research covers 468 geographic regions across the United States and Canada. The data is gathered from a network of more than 50,000 providers of materials, equipment, and labor, generating over 345,000 survey points each year. That research footprint is what makes Xactimate pricing the reference standard for property claims work — no other estimating platform publishes data at that scope.

The practical takeaway for restoration operators is that Xactimate is not “national” pricing dressed up as local — it is genuinely localized to your service area, which means defending your estimate to an out-of-area adjuster is a matter of pointing them to the documented research for your region.

How Cluster Analysis Sets the Number

For each line item in each region, Verisk performs cluster analysis on the submitted price points. The methodology identifies the largest cluster of prices and selects a point within the appropriate range. The published price reflects the most common recently submitted price for that item in that region.

This matters because it explains a recurring estimator complaint: “the price feels low compared to what I would charge.” The Xactimate price is not the highest price or the lowest price — it is the most common price for the same scope of work in the same region. Operators charging meaningfully more than the published price are signaling either a different scope, higher-quality work, or a pricing strategy that needs to be defended on its own terms.

The Update Cycle: What Updates When

Verisk updates Xactimate price lists monthly. Within that monthly cycle, the work is layered:
- Vendor-specific pricing updates nightly for items sourced from individual vendor catalogs
- Hourly billable labor rates update monthly based on the most recent regional research
- General quote prices update monthly with the new price list release
- Material and equipment components update when market analysis indicates a change is warranted
The “when warranted” language is important. Not every line item is freshly surveyed every month — that would not be feasible. Verisk’s methodology is closer to “update when the market moves” than “update on a fixed calendar.” This is why two adjacent monthly price lists can look almost identical for stable categories, then jump for categories where lumber, drywall, or other inputs have shifted.

What This Means for Your Estimating Templates

Restoration companies pulling from Xactimate should refresh their internal estimating templates monthly when the new price list drops. Templates frozen at older pricing produce estimates that get reduced on submission because they are out of step with the current published research.

The same applies to cash work where Xactimate pricing is used as a baseline reference. Cash estimates built off stale price lists give away margin to inflation that the published prices have already absorbed.

How to Read a Verisk Methodology Document

The Verisk pricing research methodology is publicly documented and worth reading at least once for anyone building estimates daily. The document explains how labor rates are weighted, how material prices are sourced, how equipment rentals are priced, and how the cluster analysis selects the published number. Knowing this language gives you a defensible vocabulary when an adjuster questions a line item.

When Xactimate Pricing Is Not the Right Reference

Xactimate pricing is appropriate for the vast majority of standard restoration scope. It is not the right reference for: highly specialized work outside the line item library, custom installations with no comparable market data, art and high-value content cleaning, or unusual structural work where the cluster analysis has thin data. For those scopes, custom estimates or specialty contractor pricing is the correct approach.

Frequently Asked Questions

How often does Verisk update Xactimate pricing?

Verisk publishes price list updates monthly. Within that cycle, vendor-specific pricing updates nightly, hourly labor rates update monthly, and general line item prices update when market analysis warrants. The monthly release is the cadence operators should plan their template refreshes around.

How many regions does Xactimate pricing cover?

Xactimate covers 468 geographic regions across the United States and Canada, with pricing researched independently for each region. This is the reason the same line item can have meaningfully different prices in different markets — the published number is built from local research.

How does Verisk decide what price to publish for a line item?

Verisk uses cluster analysis on submitted price points across more than 50,000 providers and over 345,000 annual survey points. The methodology identifies the largest cluster of prices for a line item in a region and selects a representative point within that range. The published price reflects the most common recently submitted price.

Why does my Xactimate price feel lower than my actual cost on some items?

If the published price is consistently below your cost, you are likely either operating in a higher-cost niche than the cluster average, using a higher-quality material than the published reference, or carrying overhead that the published labor rate does not absorb. Each of these is a legitimate basis for a custom price modifier or a documented variance — not a reason to ignore the published price.

Can I challenge a Verisk price if I think it is wrong for my market?

Yes. Verisk accepts pricing feedback from contractors and uses contractor submissions as part of its survey input. Submitting documented evidence of a price discrepancy can influence the next monthly research cycle. Individual estimates can also include documented variances when the published price does not reflect the actual cost of the specific work.
April 23, 2026
Xactimate Labor Efficiency Models: 2026 Update Guide
One of the most consequential Xactimate updates in recent years arrived in February 2026: Verisk expanded the labor efficiency architecture from two models to three. The new Large Restoration/Remodel option fills a long-acknowledged gap between service-level work and full rebuild scenarios. For restoration operators handling mid-sized losses, the change is meaningful — and using the wrong model is a fast way to mis-price the labor on a job.

This article assumes you understand how Xactimate fits into the broader pricing workflow. For that context, start with our restoration pricing and estimating master guide.

The Old Two-Model Architecture

Before the February 2026 update, Xactimate offered two labor efficiency models: a service-level model for small-scope, single-trade work and a restoration/remodel model for larger rebuilds. The two-tier architecture worked well at the extremes but struggled in the middle.

Mid-sized restoration jobs — partial kitchen rebuilds after water loss, multi-room fire cleanup, large mold remediation projects — did not align cleanly with either model. Estimators routinely made judgment calls or layered manual workarounds to bridge the gap. The result was inconsistent labor pricing across similar jobs, depending on which estimator built the estimate.

What the New Three-Model Architecture Looks Like

The 2026 update keeps the existing service-level and restoration/remodel models and adds a third tier — Large Restoration/Remodel — designed for mid-sized work that involves multiple trades, longer durations, and more complex coordination than a service-level job, but does not reach the scale of a full rebuild.

The practical effect is that estimators now have a defensible, system-supported choice for the work that previously required manual workarounds. This produces more consistent labor pricing across a portfolio of jobs and reduces the audit exposure that comes from improvised efficiency selections.

How to Choose Between the Three Models

The right model selection depends on job characteristics. Verisk’s documentation provides detailed selection criteria, but the field-level shorthand most experienced estimators use looks like this:
- Service-level — single-trade, short-duration, minimal coordination, typical small water mitigation or single-room work
- Large Restoration/Remodel — multi-trade, multi-week duration, moderate coordination, mid-sized fire/water/mold or partial rebuild
- Restoration/Remodel — full rebuild scope, long duration, full general contracting coordination, large losses
The Large Restoration/Remodel tier is the one most likely to be under-used initially because it is new and unfamiliar. Operators should review recent estimates that fell awkwardly between the two prior models and identify which would now fit the new tier.

Why Labor Efficiency Matters for Margin

Labor efficiency in Xactimate is not a discount or a multiplier — it is a coefficient that adjusts labor hours based on the type of work being performed. The same line item carries different labor hours under different efficiency models, because a service-level repair really does take less coordination overhead than a large rebuild.

Selecting the wrong efficiency model on a job can shift the estimated labor by 10 to 25 percent, which is the difference between a profitable job and a job that loses money on labor underestimation.

How TPAs Are Adopting the New Model

TPA programs typically take a quarter or two to fully integrate new Xactimate methodology updates into their audit and review workflows. During the transition, expect inconsistency across reviewers — some will accept Large Restoration/Remodel selections without question, others will challenge them. Documenting the reasoning for the model selection in the estimate notes is the best defense.

What to Update in Your Estimating Process

Three things to update now that the three-model architecture is live: estimating templates should include the new Large Restoration/Remodel option as a standard selection for qualifying scopes, training materials should be refreshed to cover when to use each tier, and audit checklists should include a labor efficiency model review as a standard line item.

Frequently Asked Questions

What changed in Xactimate’s 2026 labor efficiency update?

Verisk expanded the labor efficiency architecture from two models to three by adding the Large Restoration/Remodel option. The update was presented in February 2026 and is designed to bridge the gap between service-level work and full rebuild scenarios for mid-sized restoration jobs.

When should I use the Large Restoration/Remodel labor efficiency model?

Use it for mid-sized jobs that involve multiple trades, multi-week duration, and moderate coordination but do not reach the scale of a full rebuild. Common examples include partial kitchen rebuilds after water loss, multi-room fire cleanup, and large mold remediation projects.

How much can the wrong labor efficiency model affect my estimate?

Selecting the wrong efficiency model can shift the estimated labor on a job by roughly 10 to 25 percent depending on the scope. On a $30,000 estimate, that is $3,000 to $7,500 of labor either over- or under-stated. The model choice is a meaningful margin lever, not a minor technical detail.

Do TPAs accept the new Large Restoration/Remodel model?

Yes, but adoption is uneven during the early months after the release. Some reviewers accept the new tier without question, others challenge it. The best practice is to document the reasoning for the model selection in the estimate notes so the choice is defensible if questioned.

Where can I learn more about the 2026 Xactimate labor efficiency update?

Verisk has published webinar content covering the updated labor efficiencies architecture in detail. The on-demand webinar is the authoritative source for the methodology and selection criteria. Operator-level training providers have also begun including the new tier in their X1 curricula.
April 23, 2026
Xactimate Certification Levels: What Your Team Needs
Xactimate offers three certification levels that progressively cover the platform’s depth. For restoration operators staffing an estimating function, knowing which level each role actually needs is the difference between an over-trained team that costs too much and an under-trained team that produces inconsistent estimates. This guide breaks down what each level covers, what it costs, and how to think about certification across roles.

For broader context on how Xactimate fits into restoration operations, see our restoration pricing and estimating master guide.

Level 1 — Fundamentals

Level 1 covers the foundational use of Xactimate: navigation, project setup, creating estimates, adding line items, and basic sketching. It is designed for users who are new to the platform or want to solidify the fundamentals.

For restoration teams, Level 1 is the right baseline for anyone who touches an estimate at any stage — field techs who capture initial sketches, project managers who review estimates, and ownership who needs to read estimates intelligently. The certification establishes a shared vocabulary across the team and prevents the most common usage mistakes.

Level 2 — Proficiency / Power User

Level 2 builds on Level 1 and goes deeper into the more advanced platform capabilities — complex sketching, custom price lists, advanced reporting, and platform-level configuration. It is the right target for the team members who actually build estimates daily.

For most restoration companies, Level 2 should be the standard for senior estimators, project managers responsible for estimate sign-off, and anyone who configures price lists or custom rules for the company. The depth of Level 2 is what separates an estimator who builds defensible, complete estimates from one who produces work that triggers TPA reductions.

Level 3 — Mastery

Level 3 is reserved for the most complex scopes and is described as appropriate for veteran insurance adjusters with years of field experience handling the most complicated claims. The certification covers the full depth of the platform and the most nuanced estimating scenarios.

For most restoration companies, Level 3 is overkill for the standard estimating workflow. The exception is companies that handle large-loss commercial work, work as TPA program subcontractors with audit responsibilities, or operate as third-party estimating services. For those use cases, Level 3 represents a meaningful credential.

What the Exams Look Like

Each certification level requires passing an exam administered by Verisk. The passing score is 70 percent. A current Xactimate license is required to take the exams. Once achieved, certification is valid for two years before renewal is required.

The two-year renewal cycle matters for staffing planning — certifications are not lifetime credentials, and budgeting for re-certification every two years is part of running a properly trained estimating team.

What Certification Costs

Verisk offers training and exam options directly through its training platform. Third-party training providers also offer Xactimate Level 1 and Level 2 certification preparation, often bundled together. Pricing through major third-party providers tends to land around $650 for combined Level 1 and Level 2 training, with regional variation.

For operators staffing multiple estimators, building a relationship with a single training provider and running team-wide certification cycles is often more cost-effective than ad hoc individual training. Some providers offer group rates and customized training for restoration-specific scopes.

How to Think About Certification ROI

The return on certification investment is not the credential itself — it is the reduction in estimating mistakes, audit reductions, and re-work that comes from a properly trained team. A single avoided $5,000 audit reduction pays for a team’s annual training budget several times over. Companies that under-invest in certification consistently leave more money on the table than they save in training cost.

Recommended Certification Map for Restoration Teams

A practical certification map for a restoration company:
- Field techs and admin staff — Level 1 baseline, refreshed every two years
- Senior estimators and project managers — Level 2 standard, refreshed every two years
- Lead estimator / estimating manager — Level 2 minimum, Level 3 if handling large-loss commercial work
- Owner / executive — Level 1 understanding to read and review estimates intelligently
Frequently Asked Questions

How many Xactimate certification levels are there?

There are three certification levels: Level 1 (Fundamentals), Level 2 (Proficiency / Power User), and Level 3 (Mastery). Each level builds on the previous one, but you do not have to take them in sequence — a user can pursue Level 2 without holding Level 1.

What score is required to pass an Xactimate certification exam?

The passing score is 70 percent. A current Xactimate license is required to take the exam. Once passed, the certification is valid for two years before renewal is required.

How much does Xactimate certification training cost?

Pricing varies by provider. Third-party providers commonly offer combined Level 1 and Level 2 training in the $650 range, with regional and seasonal variation. Verisk also offers training and exam options directly through its platform. For up-to-date pricing, check the Verisk training site or your preferred third-party provider.

Which Xactimate certification level do my estimators need?

For most restoration companies, Level 1 is the right baseline for anyone who touches an estimate, and Level 2 is the standard for daily estimators and project managers. Level 3 is appropriate primarily for large-loss commercial estimators or third-party estimating professionals.

How often do I need to renew Xactimate certification?

Certifications are valid for two years. Renewal requires re-testing at the same level. Plan the recertification cycle into your annual training budget and stagger renewals across team members to avoid bunching the workload.
April 23, 2026
Xactimate Sketch AR: Mobile-First Restoration Workflow
Field measurement has historically been the slowest step in restoration estimating. A tech walks the loss with a tape measure or laser, jots down dimensions, returns to the office, and re-keys everything into Xactimate before the estimate can begin. Xactimate Sketch AR collapses that workflow by moving the measurement and initial sketch into the field, on a mobile device, with cloud sync to the office.

For broader context on how Xactimate fits restoration operations, see our restoration pricing and estimating master guide.

What Sketch AR Does

Sketch AR uses the camera and motion sensors on a tablet or phone to take measurements as the user walks through the loss site. The output is a 2D sketch with dimensions captured directly from the field, plus optional 3D cutaway views that help visualize the interior layout. The data syncs to the cloud and is available on the desktop estimate immediately.

The headline benefit is time. Field measurement that previously took 30 to 60 minutes per loss can be completed in 10 to 20 minutes with Sketch AR, and the office no longer needs a separate sketching step before the line item work begins.

The Mobile-First Restoration Workflow

The mobile-first workflow Sketch AR enables looks like this on a typical water loss:
- Arrival — tech opens the X1 mobile app and creates the estimate shell
- Walkthrough — tech runs Sketch AR through each affected room, capturing dimensions and damage photos tied to specific rooms
- Initial line items — tech adds preliminary line items for obvious scope (extraction, demo, equipment placement)
- Sync — estimate uploads to the cloud before the tech leaves the site
- Office completion — estimator opens the same estimate on desktop, refines line items, runs rules check, prepares for submission
Companies that adopt this workflow consistently report 30 to 50 percent compression in time from loss to estimate submission. That speed flows directly into faster cash flow and improved TPA scoring.

When Sketch AR Is the Right Tool

Sketch AR is well-suited for typical residential interiors with reasonable lighting, distinguishable wall edges, and accessible spaces. It is the right default for most water loss, mold, and partial fire jobs in homes and small commercial spaces.

It is less well-suited for: heavily damaged spaces where wall edges are obscured, dark or smoke-filled environments where the camera cannot track, very large open spaces with limited reference features, or any job requiring precision measurement for dispute defense (where traditional measurement should still be used as a verification step).

Training and Adoption

The technical learning curve on Sketch AR is short — most field techs are productive within a single training session. The harder change is workflow: moving the team from “measure on site, sketch at the office” to “sketch on site, refine at the office” requires deliberate process change.

The most common adoption failure is leaving the workflow optional. Teams that allow some techs to sketch on site and others to defer to office sketching never realize the speed benefits. Standardizing on the mobile-first workflow as the company default is the difference between marginal improvement and dramatic cycle-time compression.

Equipment and Device Considerations

Sketch AR works best on modern tablets with strong motion sensors and good cameras. iPads with LiDAR sensors produce particularly clean tracking. Spec out devices for the field team based on actual job conditions — a $400 tablet that struggles in low light produces worse measurements than a $900 tablet that handles real conditions.

Where Sketch AR Fits in the Larger X1 Workflow

Sketch AR is one of several X1 capabilities that together produce the field-to-office continuity that defines the modern Xactimate workflow. It pairs naturally with cloud-synced estimates, the Line Item Advisor for quick line item suggestions, and customizable rules that catch missed scope items at the point of entry. None of these features stand alone — they reinforce each other.

Frequently Asked Questions

What is Xactimate Sketch AR?

Sketch AR is the augmented-reality measurement and sketching feature in the Xactimate mobile app. It uses the device camera and motion sensors to capture room dimensions and produce a 2D sketch in the field, with optional 3D cutaway views. The output syncs to the cloud and is available on the desktop estimate immediately.

How accurate is Sketch AR?

Sketch AR is accurate enough for most residential interior measurements when conditions allow for clean camera tracking. For high-precision requirements (insurance disputes, large commercial losses), traditional measurement is still recommended as a verification step. Devices with LiDAR sensors typically produce cleaner results than camera-only devices.

What kind of device do I need for Sketch AR?

A modern tablet or phone with a good camera and motion sensors. iPads with LiDAR are particularly well-suited because the dedicated depth sensor improves tracking. Field teams should standardize on capable hardware rather than mixing devices that produce inconsistent results.

Can Sketch AR replace traditional measurement entirely?

For typical residential interior work in good conditions, Sketch AR can serve as the primary measurement method. For high-stakes jobs, large commercial spaces, dark or heavily damaged environments, or any situation that may end up in dispute, traditional measurement should still be used as either the primary method or a verification step.

How long does it take to train field techs on Sketch AR?

The technical training is short — most techs are productive within a single training session. The harder change is operational: standardizing the team on a mobile-first workflow rather than leaving it optional. Allow two to four weeks for the new workflow to become muscle memory across the team.
April 23, 2026
Residential Restoration Sales Scripts That Close Jobs

Residential restoration sales is won or lost in the first 60 seconds of the inbound call and the first 15 minutes of the in-home estimate. Companies that script these moments tightly close at meaningfully higher rates than companies that wing it. This article walks through the call flow, in-home conversation, and closing language that consistently performs in residential restoration sales operations.

This is part of our restoration sales playbook, which covers the full sales motion.

The Inbound Phone Call

The inbound call is the highest-leverage 3-5 minutes in residential restoration. The script needs to accomplish four things quickly: establish empathy and credibility, qualify the situation, create urgency and book the appointment, and prevent the prospect from continuing to call competitors.

The opening should never be “Hi, can I help you?” — it should be a confident, warm greeting that immediately signals competence: “[Company], this is [Name], how can I help you with your water damage today?”

The qualification questions are simple but specific: What is the source of the water? When did it start? How much area is affected? Is the water still active? Is anyone home? What city are you in? These questions both qualify the lead and demonstrate competence to the homeowner.

The booking close: “We can have a project manager on-site in [time]. Can I confirm the address?” — and then the critical ask: “Just so I can let our PM know, are you also calling other companies, or did you decide to go with us?” This last question, asked warmly and without pressure, reduces shopping behavior dramatically.

The In-Home Arrival

The first 60 seconds on-site set the tone for the entire conversation. The sequence that works: introduce yourself, ask permission to enter, ask the homeowner to walk you through what happened in their own words (don’t immediately start inspecting), then transition into a guided inspection together. Skipping the homeowner’s narrative is a common mistake — they need to feel heard before they will trust the recommendation.

The Inspection Walk-Through

Educational narration during the inspection separates restoration sales pros from amateurs. Rather than silently using a moisture meter, the rep should narrate what the readings mean, what category of water it appears to be, what equipment will be needed, and what the timeline looks like. This builds confidence and pre-frames the price.

Presenting the Scope and Price

The scope presentation should happen at the kitchen table, not standing up. The rep should walk through the scope line by line, explain why each item is necessary, address insurance process clearly, and then present the total — without flinching and without immediately offering a discount. The number is the number.

Common price language that works: “Based on what we found, the scope to dry your home down properly comes to [amount]. Most of this will be covered by your insurance policy, and we’ll work directly with your adjuster on the supplements. The out-of-pocket exposure for you depends on your deductible. Does that match what you were expecting?”

Handling the “Let Me Think About It”

The most common objection in residential restoration is the soft delay: “Let me think about it” or “I need to talk to my spouse.” The script that works addresses the underlying concern without applying pressure: “Of course. The one thing I’d mention is that the longer we wait to start drying, the more secondary damage typically occurs. We can have equipment in place today and you can still cancel within 24 hours if you change your mind. What works better for you?”

The Authorization Close

The work authorization signature is the actual close. The handoff language: “Let me get this paperwork started — it just authorizes us to begin the mitigation and lets us bill your insurance directly.” Smooth, confident, and assumes the close. Hesitant closing language (“So… do you want to do this?”) signals uncertainty and triggers second-guessing.

Frequently Asked Questions

Should restoration salespeople use a written script verbatim?

The framework should be scripted; the delivery should be conversational. Reading a script word-for-word feels robotic and erodes trust. Memorizing the structure and language patterns and delivering them naturally is the goal.

How do I train new restoration salespeople on these scripts?

Role-play is the fastest training method. Pair new reps with senior staff for ride-alongs, then run weekly role-play sessions where new reps practice handling the toughest objections. Recording actual customer calls (with consent) and reviewing them as a team also accelerates learning.

What is a reasonable close rate on residential restoration estimates?

Well-trained residential restoration salespeople running emergency mitigation typically close 60-80% of first-on-scene appointments. Reconstruction-only estimates close at much lower rates, often 25-40%, because of the longer decision cycle.

Should I quote prices over the phone?

Generally no for restoration. Phone pricing without seeing the damage triggers price shopping and locks the rep into a number that may not match the actual scope. The phone goal is to book the on-site appointment, not to quote.

How do I handle a homeowner who is getting multiple bids?

Address the underlying concern (they want to make sure they’re not being overcharged) by walking through your scope line-by-line, explaining what each item does, and offering to review competitor scopes side-by-side. Confidence in your scope and price usually wins more often than discounting.

April 23, 2026
Starting & Scaling a Restoration Company: Founder’s Guide

Starting a restoration company is easier than most people think. Scaling one past $2M in revenue is harder than almost anyone admits. The same instincts that get a founder from zero to one truck — hustle, personal customer service, doing whatever it takes — actively block growth past the first ceiling.

This is the complete founder’s guide for 2026: what it actually costs to start, what licenses and certifications you need, the staffing path, the revenue milestones where the operating model has to change, and the operational shifts that separate restoration companies that scale from the ones that stay stuck at the same revenue line for a decade.

The honest startup math

Realistic capital required to launch a one-truck residential restoration company in 2026: $50,000-$120,000. The breakdown: equipment package (dehumidifiers, air movers, HEPA filters, moisture meters, basic tools) $20,000-$40,000; truck (used cargo van or box truck, lettered) $25,000-$45,000; insurance (general liability, auto, workers’ comp, pollution liability) $8,000-$15,000 first-year; licensing and certifications (state contractor license, IICRC WRT for the founder, business setup) $2,000-$5,000; software (Xactimate subscription, basic CRM, accounting) $3,000-$6,000 first-year; working capital reserve to bridge first 90 days of receivables $15,000-$30,000.

Companies that try to start under $40K usually run into cash crisis within six months when insurance receivables stretch beyond 60 days and equipment fails. Companies that overcapitalize at $200K+ often do it by buying gear they don’t need yet.

Legal structure and licensing

Most restoration companies form as LLCs (limited liability companies) for the liability protection and tax flexibility. S-corp election is common as revenue grows past the $250K mark for tax efficiency. A handful of larger operators are structured as full C-corps, particularly those planning institutional capital or eventual sale.

Licensing requirements vary dramatically by state. State contractor licenses are required in most states for general restoration work, often at multiple levels (residential, commercial, mold, etc.). Mold remediation licenses are required in Florida, Texas, New York, Louisiana, and several other states. Asbestos and lead certifications are federal (EPA RRP) and required for renovation in pre-1978 housing. Biohazard or trauma cleanup licensing is regulated state-by-state. The first task for any new operator is a clean inventory of what licenses are required in your state and county.

The certifications you need before you take the first job

Minimum credentials before opening for residential mitigation: IICRC WRT for the founder (and any other technician), state contractor license, EPA RRP certification if any reconstruction work involves pre-1978 properties, OSHA 10 for all personnel. Add AMRT before any mold work, FSRT before any fire work. Add general liability insurance with at least $1M per-occurrence and $2M aggregate; pollution liability with at least $1M; workers’ comp for every employee; commercial auto with full coverage on the truck.

The five revenue milestones (and what changes at each)

Restoration companies hit predictable plateaus. The five milestones and the operational shifts they require:

$0-$500K (the founder phase). The founder does everything: sales, estimating, production, billing, collections. The operating model is “the founder’s calendar.” Limit: the founder’s hours.

$500K-$1.5M (the first hire phase). The founder hires a lead technician and a part-time office or bookkeeper. The operating model becomes “founder + small team.” Limit: the founder is still the only salesperson and project manager. Burnout is the most common reason companies stall here.

$1.5M-$3M (the systems phase). The first dedicated salesperson and a project manager are hired. The founder transitions from doing the work to designing the work. CRM and job management software become essential. Cash management discipline becomes critical because receivables grow faster than cash. Most companies that fail to scale fail here because the founder won’t let go of the work.

$3M-$8M (the multi-truck operation). Multiple production crews, dedicated estimating, formal sales team, in-house training program, controller-level financial oversight. The founder’s job is now strategic — sales leadership, key accounts, growth planning, hiring. Operating model is “leadership team runs the business.”

$8M+ (multi-location or large single-location). Either geographic expansion to additional locations or vertical depth in commercial and large loss work. CFO, dedicated marketing leader, regional managers. Founder transitions to CEO role or owner-investor role.

The hiring sequence that works

The proven hiring sequence for a growing restoration company: first hire, lead technician (so the founder can stop being the only field person); second hire, office administrator or bookkeeper (to handle the receivables and paperwork chaos); third hire, second technician (capacity to run two crews); fourth hire, project manager or estimator (separate the field execution from the field estimating); fifth hire, salesperson (the founder stops being the only salesperson); sixth hire, second salesperson or production manager (depending on growth direction); seventh+, controller, marketing manager, additional crews, dedicated commercial account manager.

The financial discipline most founders skip

The financial systems that have to be in place before $1.5M revenue: monthly P&L review (not just bank balance), aged receivables report (you cannot manage what you don’t measure — and restoration receivables stretch), job costing per project (revenue minus actual costs by job), cash flow forecast looking 90 days out, annual budget with monthly tracking. Companies that scale without these systems usually crash on cash management even when they’re profitable on paper.

The exit options worth knowing

Restoration companies have several viable exit paths. Strategic acquisition by a larger restoration company or franchise group (BluSky, ServiceMaster, ATI, BELFOR, and various PE-backed roll-ups have been active acquirers). Private equity for larger operators (typically $10M+ revenue with strong commercial mix). Internal sale to existing management (with seller financing common). Family transition to children or family members. Typical valuation multiples have been 3-6x adjusted EBITDA depending on size, growth, customer concentration, and commercial mix percentage.

Frequently Asked Questions

How much does it cost to start a restoration business?

A realistic startup cost for a one-truck residential restoration company in 2026 ranges from $50,000 to $120,000. The major components are equipment ($20K-$40K), a truck ($25K-$45K), insurance ($8K-$15K first year), licensing and certifications ($2K-$5K), software ($3K-$6K), and working capital to bridge initial receivables ($15K-$30K).

How do you start a restoration business?

The compressed startup checklist: form an LLC, obtain state contractor license, secure general liability and pollution liability insurance plus workers’ comp and commercial auto, complete IICRC WRT certification at minimum, purchase initial equipment package and a service vehicle, set up Xactimate subscription and basic accounting software, build initial referral relationships with local plumbers and insurance agents, establish a Google Business Profile and basic website, and begin marketing through Local Service Ads and direct outreach.

How profitable is a restoration business?

Healthy restoration companies run 8-15% net profit margin on revenue. Gross margins by service line range from 25-40% on reconstruction up to 50-65% on mold remediation. A well-run $2M restoration company should produce $160K-$300K in net profit. The most profitable operators tend to have strong commercial mix, disciplined supplement workflows, and tight job costing.

What is the average revenue of a restoration company?

Restoration company revenue ranges enormously. Single-truck residential operators typically run $400K-$1.2M. Established multi-truck residential companies $1.5M-$5M. Companies with significant commercial work or multiple service lines $5M-$25M. Multi-location operators and franchises $25M-$300M+. The industry median is around $1.5M-$2M.

How long does it take to scale a restoration company?

The typical path from startup to $5M revenue runs 5-10 years for organic growth. Faster growth is possible through acquisition, geographic expansion, or aggressive commercial business development. The most common stalling point is the $1.5M-$2M range, where the founder has to transition from doing the work to leading the team. Companies that successfully make that transition often double again in the following 3-5 years.

Can you franchise a restoration business?

Yes, the major restoration franchise groups (ServPro, ServiceMaster, BELFOR, Rainbow International, PuroClean, and others) all sell franchise territories. Franchise costs vary widely: initial franchise fees typically $40K-$75K, equipment and startup costs $100K-$300K, and ongoing royalties of 6-10% of revenue plus marketing fees. The franchise vs. independent decision depends on access to commercial work, brand recognition value in your market, and tolerance for ongoing royalty cost.

April 23, 2026
Building a Restoration Sales Team: Hiring & Retention

The transition from owner-led selling to a professional sales team is the hardest organizational shift in a growing restoration company. The owner’s selling style is usually charisma-driven and unsystematized; replacing it with reps who sell consistently requires building a hiring profile, training program, compensation plan, and management cadence that the company has never had. Most restoration companies stall at this transition; the ones that get through it are the ones that scale to $10M+.

This article is part of our restoration sales playbook.

The Hiring Profile

The two profiles that consistently work in residential restoration sales are former in-home services salespeople (HVAC, roofing, solar, pest) and former restoration project managers with strong customer-facing skills. Pure traditional B2B salespeople usually struggle with the in-home dynamic. Restoration technicians sometimes succeed in sales but more often fail because the skill profile is different.

For commercial restoration BD, the profile shifts toward B2B service sales backgrounds — commercial real estate, facility services, commercial insurance, or B2B SaaS reps with patience for long cycles.

Sourcing Sales Talent

The best sourcing channels for restoration sales talent are LinkedIn outreach to in-home services reps in adjacent industries, employee referrals (current sales reps know other sales reps), and industry events. Indeed and ZipRecruiter produce volume but quality is mixed. Recruiting agencies focused on home services sales can accelerate the process for an investment.

The Training Program

The minimum viable training program for a new restoration salesperson includes: 1-2 weeks of ride-along with senior reps observing real calls, role-play sessions covering the inbound script and in-home flow, technical product training on water/fire/mold processes (enough to be credible, not enough to be a technician), CRM and operations training, and a defined ramp period of 60-90 days before full quota.

Companies that throw new reps into the field without structured training see attrition rates above 50% in year one. Companies with structured 60-90 day onboarding typically see attrition under 20%.

Compensation Structures That Work

Residential restoration salesperson compensation typically combines a modest base salary ($40K-$60K depending on metro and experience) with commission on closed revenue (often 5-12% on mitigation, lower on reconstruction). Some operations use sliding commission scales that reward higher gross margin work and disincentivize discounting.

Commercial BD compensation usually pairs a higher base salary ($65K-$100K) with smaller commission on closed MSAs and a residual on account revenue. The longer cycle requires the higher base.

Structures that consistently fail: pure 100% commission (drives short-term behavior and high attrition), salary-only (no upside, attracts the wrong profile), and commission tied only to revenue without any margin or quality metric (produces discounting and bad customer outcomes).

Sales Management Cadence

The management cadence that works includes: daily team huddle reviewing yesterday’s appointments and today’s pipeline, weekly one-on-one with each rep covering pipeline, deal coaching, and personal development, weekly team meeting reviewing key metrics (close rate, average ticket, lead source performance), and monthly business review including compensation reconciliation and quota adjustments.

Retention Practices

Restoration sales rep retention is driven primarily by income predictability, leadership quality, and operational support (good leads, fast estimating tools, clean handoffs to production). Companies that retain reps long-term invest heavily in lead quality, operational efficiency, and middle-management capability — not just in higher commission rates.

Frequently Asked Questions

When should a restoration company hire its first salesperson?

Most restoration owners should add their first dedicated salesperson when their own selling capacity is becoming the growth constraint — typically when the company hits roughly $1.5M-$3M in revenue and the owner can no longer personally handle every estimate. Hiring earlier often means the owner has to manage someone they cannot afford; hiring later caps growth.

How long does it take a new restoration salesperson to ramp?

A well-onboarded residential rep usually reaches full productivity in 90-120 days. Commercial BD reps typically need 6-12 months to build the pipeline that produces consistent revenue. Companies that expect faster ramps usually see high attrition.

Should we pay restoration salespeople on revenue or gross profit?

Gross profit-based commission produces better behavioral outcomes (less discounting, better job selection) but requires accurate job costing that many restoration companies do not have. Revenue-based commission is simpler but creates incentive misalignment. Hybrid structures that adjust commission rate based on gross margin tier often work best.

How do I prevent salespeople from over-promising on jobs?

Strong handoff processes between sales and production, sales accountability for change orders and customer complaints, and compensation structures that include customer satisfaction or production margin metrics all reduce over-promising. Cultural emphasis from leadership on long-term reputation over short-term commission also matters.

Do restoration sales contests actually work?

Short-term contests can create useful spikes in activity (more appointments, faster follow-up) but should not replace consistent compensation structures. Contests that reward quality metrics (close rate, customer review scores) usually outperform contests that reward pure revenue.

April 23, 2026
Restoration Insurance Programs: TPA & Vendor Network Guide

The insurance ecosystem in restoration is its own universe with its own language: TPAs, carriers, preferred vendor programs, MSAs, scorecards, audits, performance guarantees, network certifications. Most restoration owners have a vague sense of what these programs are and a stronger opinion about whether to join them, often without knowing the actual economics.

This is the complete operator’s guide to restoration insurance programs in 2026: what TPAs actually do, how carrier preferred vendor programs work, what MSAs require, the real margin economics, and the framework for deciding which programs deserve your application.

The four players in the insurance restoration ecosystem

Every insurance restoration job involves up to four parties. Understanding which is which is the first step to navigating the system.

The carrier is the insurance company that issued the policy and pays the claim — State Farm, Allstate, USAA, Liberty Mutual, Travelers, Nationwide, Farmers, Progressive, Chubb, and dozens of regionals. Carriers either have in-house claims handling or contract claims management out to TPAs.

The TPA (third-party administrator) is a company that manages claims on behalf of carriers — Sedgwick, Crawford & Company, Contractor Connection, Code Blue Restoration Services, CCMSI, ESIS, and others. TPAs handle adjuster assignments, vendor management, scope review, payment processing, and customer communication on behalf of the carrier.

The vendor network is a managed roster of restoration contractors that the carrier or TPA assigns work to. Some networks are operated by TPAs (Contractor Connection is the largest); some are operated directly by carriers (Allstate Premier Service, USAA STARS).

The independent adjuster is a contracted adjuster (not a carrier employee) hired to assess specific claims, often for catastrophe events or to supplement carrier capacity. Independents work for IA firms like Eberl, Pilot Catastrophe, and Crawford.

What a TPA program actually requires

Joining a major TPA vendor network typically requires: a multi-year track record in restoration (most require 3+ years), specific IICRC certifications (firm-level plus individual technicians for relevant service lines), insurance coverage at higher limits than standard (often $2M+ general liability, $1M+ pollution liability, $1M+ professional liability), background checks and drug testing for technicians, vehicle and uniform standards, technology compatibility (use of TPA-approved estimating and reporting platforms), 24/7 dispatch capability with documented response time SLAs, monthly reporting and KPI tracking, and a signed master service agreement that defines pricing, scope, performance standards, and termination conditions.

The application process typically takes 60-180 days, includes facility audits, reference checks, and may require a probationary period of supervised job assignments before full network status.

The pricing economics of TPA work

The honest economics: TPA work pays less than direct retail work. Most TPA agreements include some form of pricing concession — typically 10-20% off published Xactimate pricing, restrictions on overhead and profit, capped supplements, or fee schedules that cap certain line items. The trade-off is volume and predictability: a vendor in good standing on a major TPA network may receive 30-100+ assignments per month depending on territory.

The math that matters: net margin per TPA job, after pricing concessions, after the operational overhead of TPA-required reporting and SLAs, and after slower payment terms (45-90 days is common). Companies that profitably run TPA programs typically have lean overhead, disciplined estimating, and the operational scale to absorb the lower per-job margin with higher volume. Companies with high overhead burden often lose money on TPA jobs they think are profitable.

Major TPAs and vendor programs to know

Contractor Connection (subsidiary of Crawford & Company) is the largest restoration vendor network, managing claims for many major carriers including Allstate, Liberty Mutual, and others. Network membership is tightly managed with strict performance standards and capacity targets.

Code Blue Restoration Services is a major restoration-specific TPA serving multiple carriers, with significant residential mitigation volume.

Sedgwick is one of the largest TPAs overall, serving commercial and residential property claims for many major carriers. Sedgwick’s vendor network is more decentralized than Contractor Connection’s.

Crawford & Company operates both adjusting services and Contractor Connection, with significant CAT (catastrophe) capacity.

Allstate’s Premier Service Program is a direct-from-carrier preferred vendor program for water mitigation and reconstruction.

USAA STARS is USAA’s preferred vendor program serving its policyholder base.

State Farm Premier Service is State Farm’s similar program (formerly Service First).

Numerous regional and specialized TPAs exist — Sedgwick CCMSI, Cunningham Lindsey (now Sedgwick), various large loss specialty firms, and carrier-specific direct programs.

Master Service Agreements (MSAs)

An MSA is the contract that governs the relationship between the contractor and the TPA or carrier. Key MSA terms to scrutinize: pricing schedule (Xactimate concession amount, capped line items, fee schedules); territory definition (geographic scope, exclusivity provisions, right of first refusal); performance metrics (response time SLAs, completion timelines, scorecard targets); payment terms (net days, retention, hold-back provisions); insurance and indemnification requirements; termination provisions (notice periods, performance-based termination, transition obligations); customer ownership (whether you can market to customers post-job, whether the carrier owns the customer relationship); audit rights (TPA rights to review your job files, scope, photos, and pricing).

MSAs are negotiable in some areas (especially territory and performance metrics) and rarely negotiable in others (pricing concessions, audit rights). Operators should have an attorney with restoration industry experience review any MSA before signing.

The decision framework: which programs to join

Whether to join a TPA program depends on four factors. Operational capacity: do you have the SLA capability, technology stack, and management bandwidth to meet program requirements? Market lead flow: is your direct lead generation strong enough that you can be selective, or do you need TPA volume to fill the calendar? Cost structure: is your overhead lean enough to make money at the program’s pricing concessions? Strategic mix: what percentage of revenue comes from TPA programs vs. direct? Most healthy operators target 30-50% TPA revenue mix — enough volume to leverage operations, not so much that the company is captive to a single TPA’s decisions.

How to win at TPA performance scorecards

Once on a TPA network, performance metrics determine assignment volume. The metrics that matter on most scorecards: response time (minutes from assignment to first contact, hours to first on-site), customer satisfaction scores (post-job surveys), cycle time (days from assignment to job completion), scope variance (how often supplements are needed and whether they’re approved), complaint rate (formal customer complaints per 100 jobs), quality scores (file documentation, photo quality, scope accuracy on TPA audits). Top-quartile performers on these metrics receive disproportionate assignment volume; bottom-quartile performers get reduced assignments and eventual termination.

Frequently Asked Questions

What is a TPA in restoration?

A TPA (third-party administrator) is a company that manages claims on behalf of insurance carriers. In restoration, TPAs handle adjuster assignment, vendor selection, scope review, payment processing, and customer communication. Major restoration TPAs include Sedgwick, Crawford & Company, Contractor Connection, Code Blue, and CCMSI.

How do you get on a carrier preferred vendor program?

The application process typically requires: 3+ years in business, specific IICRC firm and individual certifications, higher insurance limits than standard, background-checked technicians, 24/7 dispatch capability, monthly KPI reporting, and signing a master service agreement that defines pricing concessions and performance standards. Applications take 60-180 days and often include facility audits and reference checks.

Are TPA programs profitable for restoration companies?

It depends on cost structure. TPA work typically pays 10-20% less than direct retail work due to pricing concessions, capped overhead and profit, and other restrictions. Companies with lean overhead and high operational discipline can run profitable TPA programs at high volume. Companies with high overhead burden often lose money on TPA jobs while believing they’re profitable.

What is an MSA in restoration?

An MSA (Master Service Agreement) is the contract between a restoration contractor and a TPA, carrier, or commercial customer that governs the relationship — pricing schedules, territory, performance metrics, payment terms, insurance requirements, audit rights, and termination provisions. MSAs should be reviewed by an attorney with restoration industry experience before signing.

What percentage of revenue should come from TPA work?

Most healthy restoration operators target 30-50% of revenue from TPA and preferred vendor programs. Below that range, the company isn’t leveraging program volume; above that range, the company is operationally captive to a few TPAs and vulnerable to program changes, pricing reductions, or termination.

How do restoration vendor scorecards work?

TPA performance scorecards typically measure response time (minutes to first contact, hours to on-site), customer satisfaction scores, cycle time (days from assignment to completion), scope variance and supplement approval rates, complaint rates, and quality scores from TPA file audits. Top-quartile performers receive disproportionate assignment volume; bottom-quartile performers face reduced assignments and eventual network termination.

April 23, 2026
Restoration Sales Objections: Field-Tested Responses

Restoration sales objections fall into a small number of repeating patterns. The same five or six concerns surface in nearly every estimate, and the difference between a 40% close rate and a 70% close rate is largely whether the rep has rehearsed responses to these objections or is improvising in the moment. This article walks through the objections that come up most often and the language that consistently moves the conversation forward.

This article is part of our restoration sales playbook.

Objection 1: “Your Price Is Too High”

The price objection is rarely about price in isolation. It is usually about value clarity, comparison shopping, or insurance confusion. The response that works opens with curiosity, not defense: “Help me understand what you’re comparing it to” — then tailor the response to what surfaces.

If the customer has a competitor quote, walk through the scope line by line and identify what is missing in the lower bid (almost always something is). If the customer is reacting to the absolute number, reframe around insurance: “Most of this will be covered. Your out-of-pocket exposure is your deductible. The rest is between us and the carrier.”

Objection 2: “Let Me Think About It”

The soft delay is the most common objection in residential restoration. It usually means the customer has unstated concerns. The response: “Of course. What’s the main thing you want to think through?” — then handle whatever surfaces. If they truly cannot articulate a concern, the urgency framing often works: “I understand. The main thing I’d mention is that the longer we wait to start drying, the more secondary damage typically occurs. We can have equipment running in two hours and you can still cancel within 24 hours if you change your mind.”

Objection 3: “I Need to Talk to My Spouse”

This is a legitimate concern that should not be steamrolled. The response: “That makes total sense. Is your spouse available to FaceTime now? I’m happy to walk them through what we found.” If FaceTime is not possible, schedule a specific follow-up time before leaving — never an open-ended “let me know.”

Objection 4: “I’m Going to Wait and See if It Dries Out on Its Own”

This is the most expensive customer mistake in restoration. The educational response: “That’s a fair instinct. The challenge is that what looks dry on the surface usually isn’t dry inside the wall cavities and subfloor. Within 48-72 hours, that hidden moisture typically grows mold, which becomes a much more expensive remediation later. Let me show you the moisture readings behind the drywall.” Then take a meter reading on camera.

Objection 5: “My Insurance Won’t Cover This”

Often the customer is wrong about coverage, and the response is education: “Most homeowner policies cover sudden water damage from internal sources — would you mind sharing what your adjuster has said specifically?” If coverage truly is denied, transition to discussing scope reduction or financing options.

Objection 6: “I Don’t Trust You / I’ve Never Heard of Your Company”

Trust objections are rarely stated this directly but often signal through hesitation, intense scrutiny, or refusal to sign authorization. The response is credibility evidence: review counts and links, BBB rating, IICRC certifications, years in business, photos of recent jobs in their neighborhood, and offers to provide references. The defensive response (“Why don’t you trust me?”) fails. The confident response with proof works.

Objection 7: “Can You Give Me a Discount?”

The response that protects margin: “I appreciate the ask, but our pricing is set based on what it actually costs to do this work properly. What I can do is walk through the scope and see if there are any line items you’d want to remove — though I’d advise against cutting any of the drying equipment because that’s where the secondary damage risk lives.” Discounting on demand trains customers to ask every time and eats margin across the entire customer base.

Frequently Asked Questions

How many objections does a typical restoration estimate include?

A typical residential restoration estimate includes 1-3 objections from the customer before signing. Estimates with zero objections often signal the customer is going to “think about it” silently and then go elsewhere — surfacing objections in the room is actually a sign of engagement.

Should restoration salespeople memorize objection responses?

Memorize the framework, not the words. Word-for-word memorized responses sound robotic. Practiced frameworks delivered conversationally land naturally and protect against improvisation under pressure.

What is the most damaging objection-handling mistake?

Discounting at the first hint of price resistance. The price objection is usually a value clarity question — answering it with a discount confirms that the original price was inflated and trains the customer to expect discounts on future work.

How do I handle objections over the phone before the in-home visit?

Most pricing and scope questions on the phone should be redirected to the in-home visit: “I want to give you an accurate answer, and the only way to do that is to actually see the damage. Can we get a project manager out today?” Quoting blind on the phone usually loses the job and the in-home opportunity simultaneously.

When should I walk away from a customer rather than handle the objection?

Walk away when the customer is asking for scope or pricing that compromises quality (e.g., “skip the dehumidifiers”), demanding discounts that put the job below cost, or signaling distrust that the rep cannot recover. Working unprofitable or unhappy customers damages the business.

April 23, 2026
Water Damage Restoration Marketing: Proven Channel Guide

Water damage restoration is unlike almost any other home service. The buying decision happens in minutes, not weeks. The customer is panicked, often dealing with an active leak or flood, and they will hire whoever shows up first with credibility. Marketing for water damage restoration is therefore less about persuasion and more about presence — being visible at the exact moment a homeowner or property manager opens their phone and types “water damage near me.”

This guide covers the full channel stack that profitable water damage restoration companies use to capture that demand and build a referral engine that keeps producing between emergencies. For the broader strategic context, see our complete restoration marketing guide, which sits above this article in the hub-and-spoke architecture.

Why Water Damage Marketing Is Different

Three structural realities shape every marketing decision in this category. First, intent is overwhelmingly bottom-funnel. Almost no one searches “water damage restoration company” out of curiosity. They search because they have a problem. That collapses the funnel and rewards channels that intercept high-intent searches.

Second, the competitive set is dominated by Google. Google Search, Google Maps, Local Service Ads, and Google Business Profile collectively account for the majority of net-new water damage leads in most metros. If a restoration company is not visible across all four, it is competing for table scraps.

Third, insurance and TPA dynamics shape lead economics. A water damage job paid through a carrier preferred vendor program has a different margin profile than a cash retail job sourced from Google. Marketing has to be tuned to the mix the operator actually wants.

The Five Channels That Drive Most Water Damage Leads

1. Google Local Service Ads (LSAs)

LSAs sit at the top of the search results page above traditional paid ads and the map pack. For water damage queries, LSAs produce leads at a cost per acquisition that is typically lower than Google Ads in most markets, though margins vary by metro. The Google Guaranteed badge is a meaningful conversion lever for cold homeowners. Setup requires background checks, license verification, and insurance documentation — friction that becomes a moat once cleared.

2. Google Ads (Search)

Traditional pay-per-click on emergency keywords (“water damage restoration,” “flooded basement,” “burst pipe cleanup”) remains the workhorse channel for most restoration companies. Campaign structure matters enormously here. Single-keyword ad groups, hyperlocal geo-targeting, call-only ads after hours, and aggressive negative keyword lists separate profitable accounts from money pits.

3. Google Business Profile and the Map Pack

Map pack visibility is essentially free traffic, but it is also the most competitive surface in local search. Ranking in the three-pack for “water damage restoration [city]” requires consistent NAP citations, a steady stream of authentic reviews with keyword-rich responses, regular GBP posts, geo-tagged photo uploads, and proximity to the searcher.

4. Organic SEO and Content

Organic search is a longer-term play but produces the cheapest leads at scale. Service pages targeting “[service] in [city]” combinations, neighborhood landing pages for high-value zip codes, and educational content answering insurance and restoration process questions all stack into a moat that competitors struggle to replicate.

5. Insurance Adjuster and Plumber Referrals

Marketing is not only digital. The most profitable restoration companies invest heavily in offline relationships with adjusters, plumbers, property managers, and real estate agents. A single plumber referral relationship can produce more revenue than a full year of paid search.

Budget Allocation: Where to Put the First Marketing Dollar

For a restoration company spending under $5,000 per month on marketing, the priority order is usually: GBP optimization first (it is free), then LSAs (lowest CAC for verified businesses), then a tightly scoped Google Ads campaign on emergency keywords, then organic content investment. Social media and display should generally come last in the water damage category because intent is too immediate for those channels to convert efficiently.

For companies spending $10,000-$50,000 per month, the channel mix expands to include programmatic display for retargeting, YouTube for brand awareness in target zip codes, and a content marketing operation that produces 4-8 SEO-targeted pieces per month.

Tracking and Attribution

Water damage marketing fails when leads cannot be tracked back to source. Every campaign should use call tracking numbers (CallRail, CallTrackingMetrics, or WhatConverts), every form should fire a conversion event, and every job should be tagged in the CRM with its origin channel. Without this, marketing decisions are guesses.

Frequently Asked Questions

How much should a water damage restoration company spend on marketing?

Most healthy restoration companies invest between 5% and 12% of revenue on marketing, with a higher share during the first three years while organic and referral channels are still being built. Companies relying primarily on paid acquisition often run closer to the higher end of that range.

Are Google Local Service Ads worth it for water damage?

For most water damage restoration companies in mid-sized and major metros, yes. LSAs typically produce a lower cost per lead than traditional Google Ads and the Google Guaranteed badge improves close rates on cold inbound calls. The qualifying process is the main barrier.

What marketing channels work best for commercial water damage?

Commercial water damage leans more on relationships, MSAs with property management firms, LinkedIn outreach, and association involvement than on paid search. Paid search still matters but a larger share of commercial pipeline comes from offline business development.

How long does SEO take for a restoration company?

Local SEO results — map pack visibility, branded search, and a handful of city service pages — typically begin to compound in 90-180 days. Building a competitive organic presence on the most valuable water damage keywords in a major metro often takes 12-24 months of consistent content and link building.

Should a restoration company hire an agency or build marketing in-house?

Companies under roughly $3M in revenue usually get more value from a specialized restoration marketing agency than from an in-house hire, because the talent pool of operators who understand both restoration and digital marketing is thin. Above $5M, an internal marketing leader paired with specialist agencies is often the best mix.

April 23, 2026

Category: The Restoration Operator’s Playbook

The Research Footprint

How Cluster Analysis Sets the Number

The Update Cycle: What Updates When

What This Means for Your Estimating Templates

How to Read a Verisk Methodology Document

When Xactimate Pricing Is Not the Right Reference

Frequently Asked Questions

How often does Verisk update Xactimate pricing?

How many regions does Xactimate pricing cover?

How does Verisk decide what price to publish for a line item?

Why does my Xactimate price feel lower than my actual cost on some items?

Can I challenge a Verisk price if I think it is wrong for my market?

The Old Two-Model Architecture

What the New Three-Model Architecture Looks Like

How to Choose Between the Three Models

Why Labor Efficiency Matters for Margin

How TPAs Are Adopting the New Model

What to Update in Your Estimating Process

Frequently Asked Questions

What changed in Xactimate’s 2026 labor efficiency update?

When should I use the Large Restoration/Remodel labor efficiency model?

How much can the wrong labor efficiency model affect my estimate?

Do TPAs accept the new Large Restoration/Remodel model?

Where can I learn more about the 2026 Xactimate labor efficiency update?

Level 1 — Fundamentals

Level 2 — Proficiency / Power User

Level 3 — Mastery

What the Exams Look Like

What Certification Costs

How to Think About Certification ROI

Recommended Certification Map for Restoration Teams

Frequently Asked Questions

How many Xactimate certification levels are there?

What score is required to pass an Xactimate certification exam?

How much does Xactimate certification training cost?

Which Xactimate certification level do my estimators need?

How often do I need to renew Xactimate certification?

What Sketch AR Does

The Mobile-First Restoration Workflow

When Sketch AR Is the Right Tool

Training and Adoption

Equipment and Device Considerations

Where Sketch AR Fits in the Larger X1 Workflow

Frequently Asked Questions

What is Xactimate Sketch AR?

How accurate is Sketch AR?

What kind of device do I need for Sketch AR?

Can Sketch AR replace traditional measurement entirely?

How long does it take to train field techs on Sketch AR?

The Inbound Phone Call

The In-Home Arrival

The Inspection Walk-Through

Presenting the Scope and Price

Handling the “Let Me Think About It”

The Authorization Close

Frequently Asked Questions

Should restoration salespeople use a written script verbatim?

How do I train new restoration salespeople on these scripts?

What is a reasonable close rate on residential restoration estimates?

Should I quote prices over the phone?

How do I handle a homeowner who is getting multiple bids?

The honest startup math

Legal structure and licensing

The certifications you need before you take the first job

The five revenue milestones (and what changes at each)

The hiring sequence that works

The financial discipline most founders skip

The exit options worth knowing

Frequently Asked Questions

How much does it cost to start a restoration business?

How do you start a restoration business?

How profitable is a restoration business?

What is the average revenue of a restoration company?

How long does it take to scale a restoration company?

Can you franchise a restoration business?

The Hiring Profile

Sourcing Sales Talent

The Training Program

Compensation Structures That Work