Commercial roof warranties – are they fact or fiction, are they good or bad, and more importantly – are they even worth the paper they are printed on?
By: Curtis Liscum, RRC, RRO
Senior Consultant
Are commercial roof warranties just "marketing tools" offered by roofing material manufacturers or installing roofing contractors to sell roofing products and roofing projects, or are they an essential part of a roofing project?
Understanding Commercial Roof Warranties
All commercial roof warranties, available from various roofing material manufacturers, are different. They may have similar coverage, terms, limitations, and exclusions, but it is imperative to read a specimen copy very closely and understand the coverage, limits of liability, list of exclusions, and the owner's responsibilities. Warranties can provide limited assurances to the owner indicating the roof will perform as intended and can be an integral part of the building risk management plan but are of most value if the true benefits and limitations of the documents are understood.
A commercial roof warranty is a contractual relationship between the warrantor and building owner and therefore, like any contract, the terms and conditions of the contract can be subject to negotiation. Warrantors may "easily" negotiate some terms (like legal jurisdiction), but other terms (like hail damage coverage) may come at a considerable cost or require changes in the roof's construction.
There are two types of warranties in the commercial low-sloped roofing business, expressed and implied. The commercial roof warranty is an example of an expressed warranty, it expressly defines the extent of responsibility and the limits of liability of the warrantor. Implied warranties are defined by the Uniform Commercial Code (UCC). According to the UCC, for every manufactured product brought to market, the manufacturer implies that the product is fit for its intended use.
In the case of a commercial roof warranty, two different entities may provide a warranty: the roofing material manufacturer and the installing roofing contractor. The roofing material manufacturer's warranty is the expressed warranty discussed and may have warranty terms from 5 to 25+ years, with the most common terms of 10 or 20 years. The installing roofing contractor's warranty is short-term (2 to 5 years) in duration and will generally only repair the roof to make it watertight if the causing problems are associated with the contractor's installation workmanship.
Most commercial roof warranties provide remedies for watertightness, provided the cause of the leak is a covered event. Warranties do not stop or prevent leaks. Warranties are reactive in remedy and not a replacement for a proactive preventive maintenance program.
Most standard commercial roof warranties only cover products sold or authorized by the roofing material manufacturer, and in most cases, only cover the roof and flashing membrane and products listed on the warranty. Generally speaking, commercial roof warranties cover leaks that develop due to a workmanship or product defect, provided that the roof is installed by a roofing material manufacturer's authorized contractor.
All warranties are different and, as previously discussed, contractual terms may be negotiated. Here is a list of some of the common exclusions and limitations of commercial roof warranties:
- Roof design
- Installing contractor improper workmanship
- Catastrophic events
- Damage
- Moisture intrusion other than a leak
- Incompatible materials or substances
- Change in building occupancy
- Unauthorized repairs or modifications
- Lack of positive drainage
A commercial roof warranty will stipulate exactly what remedies a building owner is entitled to if a covered event occurs and will include the statement that "the stated remedy is your sole and exclusive remedy" for the covered claim. Warranties cover leaks so therefore the common remedy is to repair the covered component (roof and flashing membrane) to stop the leak.
Warranty Terms
As previously discussed, warranty terms are negotiable. Commercial roof warranties can be modified using addenda or riders. Adding addenda or riders to a warranty may require changing the roof components such as selecting thicker membranes, durable cover boards, additional membrane plies, or increased attachment. A few of the common addenda or riders are as follows:
- Increased wind speeds
- Hail protection
- Total system to include all materials Installed within the roof
Commercial roof warranties may require that the owner perform several functions to maintain the validity of the warranty. Some of these include the following:
- Payment for material installed
- Warranty execution
- Use of an authorized contractor
- Using approved repairs
- Prior acceptance of modifications
- Timely notification of leaks
- Performance and documentation of maintenance
- Providing free, unlimited roof access
Warranty Durations
There are several durations and forms of warranty available on the market today and they are changing constantly. The most common is the standard labor and material warranty. This warranty will provide a remedy to repair a leak caused by a covered event. This form of warranty commonly covers the waterproofing membrane but can also include other components if included by addendum or rider. This warranty covers leaks caused by product manufacturing defects and contractor workmanship.
Regularly this warranty has an NDL (no-dollar-limit) monetary limitation. This implies that the warrantor has no monetary limit on the cost of the remedy for the repair of a leak by a covered event. Contrarily, warranties can include monetary limitations or penal sum limitations.
Warranty durations vary by roof system type, roof components, and market requirements. Typical durations are from 5 to 20 years with some roofing material manufacturers offering warranties with durations over 25 years. Installing roofing contractor warranties are commonly for 2 years, with some offerings of 5 to 10 years. Warranty duration is not an indication of roof performance but is a form of limited insurance for a covered roof leak.
Types and Fees
Most of this article has been centered around a commercial roof warranty offered by a roofing material manufacturer. However, it is common on roofing projects that the installing roofing contractor is required to provide a warranty directly to the building owner in addition to the warranty offered by the roofing material manufacturer. The common differences are that this warranty coverage is generally shorter in duration (2 to 10 years) and that the warranty not only covers leaks but also workmanship defects.
Warranty fees are not insignificant and can add thousands of dollars to the cost of a roofing project. It is common practice in the industry for roofing material manufacturers to offer material warranties at no cost. Although installing roofing contractor's warranties have value, their fee is almost always included in the installation cost of the roof system. When you compare the warranty fee to an investment for annual preventative maintenance, the commercial roof warranty fee is much less. However, as we discussed, roof maintenance is an owner requirement of most commercial roof warranties.
A commercial roof warranty may be considered by some as a part of their overall building risk management plan, and therefore any strategy must be reviewed and implemented as a part of that overall plan. The most common approach is to include a long-term (20-year) commercial roof warranty from the roofing material manufacturer as part of the project. Included would be a shorter-term (2-year) warranty from the installing roofing contractor. Although this approach is used on thousands of roofing projects each year, it does have some shortcomings:
- The commercial roof warranty is subject to the myriad of terms, conditions and limitations of the expressed warranty.
- This approach does not engage the installing roofing contractor in any long-term responsibility for their workmanship.
- This approach may include duplicate premiums for events already covered by property insurance.
- With this strategy, there is no coverage from the designer of record for the quality of the design.
An alternate strategy may be to have each project team member be responsible for their portion of the low-sloped commercial roofing project. The following are suggestions for consideration:
As a part of the project, obtain a long-term (20-year) material warranty from the roofing material manufacturer to cover leaks associated with a material defect.
Obtain a mid-term (10-year) warranty from the installing roofing contractor to cover leaks associated with installation workmanship.
To close the "design" gap, use insured architects/engineers/consultants (A/E/C) with experience and knowledge in roof design.
Establish a comprehensive annual roof preventive maintenance program to review and maintain the roof.
Finally, as a part of the building risk management plan, review and understand the property insurance for coverage during significant weather events.
Regardless of the commercial roof warranty strategy implemented, it is imperative that as a functional part of the overall building risk management plan, the commercial roof warranty is reviewed and the terms, conditions, and limitations are understood. Warranties can provide limited assurances to the owner that the roof will perform as intended, but only if you understand the true benefits and limitations of the documents.
--
This article is a truncated version of a previously written three-part series. If you are interested in learning more, please check them out: