Xactimate O&P: What It Is, Why Carriers Fight It, and How Florida Contractors Can Win
Xactimate overhead profit disputes in Florida are one of the most common — and most winnable — billing fights restoration contractors face. If you’ve been doing restoration work for more than a few months, you’ve already run into it: you include O&P in your estimate, the adjuster removes it, and you either accept the reduction or spend hours arguing about it.
At Precision Estimates, our billing team fights O&P disputes on Florida restoration claims every day. This guide explains exactly what Xactimate overhead profit is, why you’re entitled to it, and how to document your claim so denial becomes much harder.
What Is Xactimate Overhead Profit in Florida Restoration Claims?
In Xactimate, overhead and profit is a percentage markup applied to the total cost of a restoration project. It covers two things:
- Overhead: The real business costs of running a restoration company — insurance, vehicles, equipment, office staff, licensing, software, marketing. These are legitimate costs not captured in individual line item labor rates.
- Profit: The return a business owner earns on the risk, capital, and management effort invested in a project.
The standard Xactimate overhead profit markup is 10% overhead and 10% profit — commonly called “10/10” or “20% O&P.” This is the industry standard, recognized by virtually every insurance carrier in the country. According to Xactware (a Verisk company), O&P is built into the Xactimate platform as a standard component of complete restoration estimates.
The question is not whether Xactimate overhead profit exists — it does. The question is when carriers are obligated to pay it.
Why Carriers Fight Xactimate Overhead Profit in Florida
Argument 1: “O&P is only for reconstruction, not mitigation”
The carrier’s position is that Xactimate overhead profit applies only when a general contractor is coordinating a complex reconstruction project involving multiple trades — not when a single mitigation company is performing drying and demolition. There is some technical basis for this argument in certain policy interpretations, but it is applied far too broadly as a blanket rule.
Argument 2: “The contractor is not acting as a general contractor”
Carriers sometimes argue O&P is only owed when you’re coordinating subcontractors on a full reconstruction project. Again, this is applied incorrectly in most Florida claims where the restoration company is managing multiple aspects of the loss.
When You Are Entitled to Xactimate Overhead Profit
The clearest entitlement to Xactimate overhead profit in Florida exists when you are managing multiple trades or subcontractors, coordinating between the property owner, the carrier, and multiple service providers, managing both mitigation and reconstruction phases, or holding a Florida general contractor license. Our claims management team documents all of these factors on every eligible job.
How To Document an O&P Claim Carriers Can’t Easily Deny
Document your coordination role in writing
Create a project coordination log for every job — a dated record of every coordination action. Every adjuster call, every property owner interaction, every subcontractor you coordinated. This demonstrates you are managing a project, not just performing a single trade service — and that coordination function justifies Xactimate overhead profit.
Include O&P explicitly in your Xactimate estimate
Don’t bury it. Include it with the correct line item and reference it in your scope narrative. Make the adjuster specifically acknowledge and deny it rather than quietly remove it from their version.
Respond to denials with a formal position letter
When a carrier denies your Xactimate overhead profit claim, send a formal written response stating your position, attaching your coordination log, and asking them to cite the specific policy exclusion language they’re relying on. Most field adjusters apply O&P denials based on general practice, not specific policy language — and when you ask for the specific language, it forces coverage team involvement, which often changes the outcome.
The Numbers Behind O&P Recovery
If your company does $150,000 per month in restoration work, a 20% O&P markup is $30,000. If you’re consistently failing to collect it, you’re leaving $10,000 to $20,000 per month on the table. Over a year, that’s a real number — and it’s why Xactimate overhead profit disputes are worth fighting professionally.
Precision Estimates includes O&P recovery in our standard billing process for every Florida restoration contractor we work with. Schedule a free consultation and let us show you how much you’re losing on O&P alone.
Stop Leaving Money on the Table
Precision Estimates handles your Xactimate estimating, supplement writing, billing, and full claims management — Florida-wide, performance-based, zero upfront cost.
