Tariffs are a big part of current economic conversations. As some tariffs and decisions change day-to-day, we know restorers have questions. We turned to Cotality expert Jay Thiers, Vice President of Pricing Analysis and Delivery, to help bring some clarity to the situation. Below is his take on how the current tariffs are already impacting restorers and what can be expected in the coming months.
Do you have any questions on pricing and the current market that you want answered? Email us at [email protected].
1. How are current and proposed tariffs impacting the cost of key materials restorers rely on, such as lumber, drywall, and roofing materials?
Based on the initial tariffs impacting Mexico, China, and Canada, Cotality has estimated up to a 10% increase on several major categories of building materials, including wood products, concrete, steel products, and appliances. Cotality is actively monitoring material costs and is beginning to see some regional cost increases flow through to the supply chain, which will begin to be reflected in construction pricing within the next quarter.
2. Are there specific materials or products that you expect to see the biggest price increases on due to tariffs?
Cotality is anticipating potential larger increases to wood products and steel products. Appliances and other electronics-based goods may also see larger impacts if the proposed higher-percentage tariffs on Chinese goods are carried through.
3. What are some key things restorers should know about the current economy in Q1 of 2025?
Consumer sentiment continues to decline, amongst economic uncertainty relating to inflation and tariffs. In addition, there is some risk of stagflation, where bouts of increased inflation occur, but wages remain stagnant or even decline. There is some evidence that this is occurring within parts of the Canadian economy. Restorers may also expect to see additional increases in vehicle and equipment acquisition costs, absent any policy reversal to lower material tariffs.
4. What can restorers do if their insurance payouts aren’t keeping pace with rising material costs?
Restorers can rest assured that carriers utilizing Cotality claims and underwriting solutions are provided with the latest material prices, sourced daily and updated monthly throughout the United States by a team of Data Intelligence professionals. Yes, we also source material daily for Canada.
5. Beyond cost increases, have tariffs affected the availability of materials commonly used by restoration professionals? Are certain items taking longer to source?
Cotality has not been made aware of or observed any supply chain logistic issues that would specifically impact the restoration community.
6. Are there any projections for how tariffs might continue to affect the industry in the next 6-12 months?
Price increases and inflationary processes related to tariff policies are likely to unevenly impact almost all industries across the next 6-12 months and then level off, absent any intervening events. Inventory costs and associated inventory turnover will be highly dependent on sourcing mix, regional supply and demand, and other microeconomic and macroeconomic trends, including interest rate sensitivity.
Jay Thies
Jay Thies has 25 years of experience in financial services, insurance carrier, and insurtech, as well as 18 years of claims background. Most recently, Jay spent more than 10 years with Liberty Mutual Insurance in a variety of corporate claims strategy and claims estimating roles. Based remotely in Massachusetts, Jay joined Cotality in March 2023 to lead the Pricing Analysis & Delivery department, which is responsible for the research, analysis, and publishing of construction pricing data that is used to power Cotality Claims, Underwriting, and Government Solutions.
Jay received his MBA from Nichols College and his Bachelor’s degree in Business and Economics from Worcester State University. Jay also has CPCU, AIC, AIC-M, and ARM insurance designations and is an Eagle Scout. Jay has been married to his wife Trini for 12 years and has two dogs. Jay enjoys working on cars in his spare time and prides himself on being able to repair just about anything he can get his hands on.
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