The Complete Guide to Xactimate (2026)

Xactimate is the industry-standard estimating software for property insurance claims, built by Verisk (formerly Xactware). It uses a proprietary, region-specific pricing database updated monthly with current material and labor costs. Every major insurance carrier in the United States and Canada uses Xactimate, and estimates are exchanged in ESX file format through XactAnalysis. If you're an adjuster, contractor, public adjuster, or supplement company working insurance claims, Xactimate is the required tool.

This guide covers everything about Xactimate in one place - what it does, how it works, who needs it, and how it fits into the claims process.

What Xactimate Is

Xactimate is estimating software built specifically for property insurance claims. It was created by Xactware, which is now owned by Verisk Analytics. The software does one thing very well: it lets you build detailed, itemized repair estimates for damaged properties using standardized pricing data.

Every major insurance carrier in the United States and Canada uses Xactimate. It's the shared language between carriers, adjusters, and contractors. When a carrier's adjuster writes an estimate and a contractor writes a supplement, they're both working in the same software, using the same line items, and referencing the same pricing database. That standardization is why Xactimate dominates the industry.

Who Uses Xactimate

Understanding who uses Xactimate and why helps make sense of how the software fits into the claims ecosystem.

Insurance Carriers

Every major carrier - State Farm, Allstate, USAA, Travelers, Liberty Mutual, and dozens of others - uses Xactimate as their primary estimating tool. When a claim is filed, the carrier's adjuster writes the initial estimate in Xactimate. The carrier's claims system is built around Xactimate data. Their pricing databases, their review workflows, their supplement processes - all Xactimate.

Staff Adjusters

Staff adjusters are employees of insurance carriers. They inspect damaged properties and write estimates in Xactimate. The estimate they produce becomes the carrier's initial offer for the claim. Staff adjusters typically specialize in certain damage types (wind/hail, water, fire) and work in specific geographic regions.

Independent Adjusters

Independent adjusters (IAs) work for adjusting firms that contract with carriers. When storm season hits and carriers get overwhelmed with claims, they deploy IAs to handle the volume. IAs use Xactimate the same way staff adjusters do - inspect, estimate, submit. They're especially common after hurricanes, hailstorms, and other large-scale weather events.

Public Adjusters

Public adjusters work for the property owner, not the carrier. They write their own Xactimate estimates, review the carrier's estimate, and negotiate on the policyholder's behalf. A PA who knows Xactimate well can go line-by-line with the carrier's adjuster and point to exactly where the estimate is short.

Restoration Contractors

Contractors who work insurance claims - roofing, water restoration, fire restoration, general contracting - use Xactimate to write supplements, verify adjuster estimates, and submit revised scope through XactAnalysis. For contractors, Xactimate is the tool that turns "the adjuster missed items" into a documented, priced, submittable request for additional payment.

Supplement Companies

Supplement companies specialize in writing supplements on behalf of contractors. They receive the adjuster's estimate, compare it to the contractor's field documentation, identify missed scope, and write the supplement in Xactimate. This is their core business, and they live in Xactimate all day.

How Xactimate Works

At its core, Xactimate is a database-driven estimating tool. Here's how the pieces fit together:

The Pricing Database

Xactimate's pricing database is updated monthly and covers material costs, labor rates, and equipment charges for every region in the US and Canada. When you add a line item for "Remove and replace 3-tab shingle roofing," Xactimate pulls the current price for that item in your specific region.

This is the feature that makes Xactimate the industry standard. Everyone is working from the same pricing data. When a contractor and an adjuster disagree about a line item, they're disagreeing about quantity or scope - not about whether the price per square is correct. The database settles the pricing question.

Prices are region-specific and date-specific. A price list from Dallas in January 2026 will have different material costs than one from Miami in March 2026. This matters when you're reviewing an adjuster's estimate - if they used an outdated price list, line item prices may be lower than current rates.

Line Items

Line items are the building blocks of every Xactimate estimate. Each line item represents a specific task or material:

• A category code (what type of work it is)
• A description (what exactly is being done)
• A quantity (how much - square feet, linear feet, each)
• A unit price (from the pricing database)
• A total (quantity x unit price)

Line items are organized into categories and trade groups. Roofing items go in the roofing category. Drywall items go in the drywall category. This organization matters because it affects how the estimate is reviewed, how supplements are evaluated, and whether overhead and profit is justified (more trades involved = stronger case for O&P).

Sketch

The Sketch module is Xactimate's built-in drawing tool. You use it to create floor plans, roof diagrams, and elevation views of the property. Sketch isn't just for visual reference - it's how Xactimate calculates areas and quantities.

When you draw a room in Sketch and mark the walls that need drywall replacement, Xactimate automatically calculates the square footage based on your dimensions and wall heights. The line items pull their quantities from the Sketch. Change a room dimension in Sketch, and every related line item updates automatically.

This is also where many estimators struggle. Sketch has a learning curve. Drawing accurate rooms, adding doors and windows in the right locations, handling multi-story properties, and creating roof diagrams with the correct pitch and geometry takes practice. It's the area where certification training provides the most value.

Macros and Templates

Macros are groups of line items that you save and reuse. If you frequently estimate water damage in a bathroom, you can create a macro with all the standard line items (demo wet drywall, dry the structure, treat for mold, rebuild drywall, texture, paint) and apply that macro to any new estimate with one click. This saves significant time on repetitive estimates.

Templates work similarly but at the project level. You can create a template with standard claim information, default settings, and pre-loaded macros for specific damage types.

Reports and Output

Xactimate generates detailed reports from your estimate. The standard output includes:

• A summary page with claim information and totals
• A detailed line item breakdown by category
• Sketch drawings (floor plans, roof diagrams, elevations)
• Depreciation schedule showing RCV and ACV per item
• Photo pages if photos were attached

You can export these reports as PDFs for sharing with homeowners, carriers, or other parties. You can also export the entire project as an ESX file for sharing the editable version.

Xactimate Desktop vs. Xactimate Online

Xactimate comes in two versions:

Xactimate Desktop

The traditional installed version that runs on Windows. You install it on your computer, download price lists locally, and work offline. This is the version most experienced estimators grew up on. It tends to perform better for complex Sketch work and large estimates because it runs locally rather than through a browser.

Xactimate Online (XOL)

The browser-based version that runs in your web browser. No installation required. Your projects are stored in the cloud. You can access your estimates from any computer with an internet connection. This version is gaining adoption because it's easier to deploy across teams, works on Mac (since it's browser-based), and always runs the latest version.

Both versions produce the same ESX files and use the same pricing databases. The choice between them usually comes down to personal preference, IT requirements, and whether you need to work offline.

XactAnalysis: The Workflow Layer

XactAnalysis is the companion platform to Xactimate. If Xactimate is where you write the estimate, XactAnalysis is where the estimate goes after you write it.

XactAnalysis handles:

• Assignment distribution. Carriers push claim assignments to adjusters through XactAnalysis. The adjuster receives the assignment, inspects the property, writes the estimate in Xactimate, and submits it back through XactAnalysis.
• Estimate review. Carriers review submitted estimates in XactAnalysis. They can approve, request revisions, or reject estimates through the platform.
• Supplement processing. When a contractor or PA submits a supplement, it flows through XactAnalysis. The carrier's review team can compare the supplement to the original estimate side by side.
• Quality control. XactAnalysis has built-in review rules that flag potential issues in estimates - unusual line items, pricing anomalies, missing information. This is the carrier's quality check before approving payment.

XactNet is the underlying network that connects Xactimate to XactAnalysis. When you submit an estimate from Xactimate, it travels over XactNet to reach the carrier's XactAnalysis instance. Think of XactNet as the highway and XactAnalysis as the destination.

The Insurance Claims Workflow in Xactimate

Here's how a typical insurance claim flows through the Xactimate ecosystem, start to finish:

1. Claim Filed

The policyholder files a first notice of loss (FNOL) with their carrier. The carrier creates a claim in their system.

2. Assignment Distributed

The carrier pushes an assignment through XactAnalysis to an adjuster (staff or independent). The assignment includes the claim information and any initial documentation.

3. Field Inspection

The adjuster inspects the property. They document damage, take measurements, photograph everything, and assess the scope of loss.

4. Estimate Written

Back at their desk (or in the field with a laptop), the adjuster builds the estimate in Xactimate. They draw the Sketch, add line items for all damage they observed, apply the regional price list, calculate depreciation, and generate the report.

5. Estimate Submitted

The adjuster submits the completed estimate through XactAnalysis. The carrier reviews it. If approved, the carrier issues payment to the policyholder based on the estimate total (minus the deductible).

6. Contractor Receives the Estimate

The policyholder hires a contractor. The contractor receives the adjuster's estimate - usually as a PDF. The contractor reviews the estimate against their own field assessment of the damage.

7. Supplement (If Needed)

If the contractor identifies damage or scope of work the adjuster missed, they write a supplement. This means opening the adjuster's estimate in Xactimate (from the ESX file), adding the missing line items, documenting the additional scope, and submitting the supplement through XactAnalysis or directly to the adjuster.

If the contractor only has a PDF and needs the ESX file, they can request it from the adjuster or use a tool like CapOut to convert the PDF and send it directly to their Xactimate account. CapOut also generates production-ready outputs from the same upload: profit breakdowns by trade, material and labor orders, and an AI Claim Assistant for building documented responses to denied line items.

8. Supplement Review and Payment

The carrier reviews the supplement. They may approve it, partially approve it, or deny it. If approved, additional payment is issued. If denied, the contractor or PA can provide additional documentation, escalate the dispute, or invoke the appraisal clause.

9. Recoverable Depreciation

On replacement cost policies, the carrier initially pays the ACV (replacement cost minus depreciation). After repairs are completed, the policyholder submits proof of completion and the carrier releases the recoverable depreciation - the remaining funds to bring the payment up to the full replacement cost value.

Key Xactimate Concepts

These are the concepts every Xactimate user needs to understand:

RCV vs. ACV

Replacement Cost Value (RCV) is the full cost to repair or replace damaged property with materials of like kind and quality. Actual Cash Value (ACV) is the RCV minus depreciation. On a replacement cost policy, the carrier pays ACV first, then the recoverable depreciation after repairs are completed.

Depreciation

Depreciation in Xactimate reduces the value of items based on their age and condition. Each line item can have a depreciation percentage applied. The depreciation schedule shows the RCV, depreciation amount, and ACV for every line item. Understanding depreciation is essential for contractors because it directly affects the initial payment amount.

Recoverable depreciation is the portion the policyholder can recover after completing repairs. Non-recoverable depreciation is money the policyholder cannot get back, regardless of whether repairs are completed. The policy language determines which applies.

Overhead and Profit

Overhead and profit (O&P) is the markup that covers the general contractor's business expenses and profit margin. In Xactimate, it's typically 10% overhead + 10% profit on the net claim amount. O&P is one of the most disputed items in insurance claims - carriers often try to exclude it, while contractors argue it's a legitimate cost of multi-trade repair projects.

The Supplement Process

A supplement is a revised estimate that adds scope or adjusts line items from the original adjuster's estimate. Supplements are the primary mechanism for contractors to get additional payment for work the adjuster missed. The supplement process requires careful documentation, accurate line item additions, and supporting evidence (photos, measurements, building code references).

Getting Started with Xactimate

If you're new to Xactimate, here's the practical path:

1. Get Access

You need a Xactimate subscription. Contact Verisk for pricing. If you work for an adjusting firm or a large contractor, your employer may provide access. If you're an independent contractor or PA, you'll purchase your own subscription.

2. Learn the Basics

Start with the fundamentals: navigating the interface, creating a project, entering claim information, adding line items, and generating a report. Don't jump into Sketch until you're comfortable with the basics.

3. Master Sketch

Sketch is where the learning curve is steepest. Practice drawing rooms, adding doors and windows, creating multi-story structures, and building roof diagrams. Start with simple rectangular rooms and work up to complex layouts. This is the skill that separates competent Xactimate users from everyone else.

4. Get Certified

Xactimate certification (available at Levels 1, 2, and 3 through Verisk) validates your skills and opens doors for employment and credibility. Level 1 covers fundamentals, Level 2 covers advanced usage, and Level 3 is for trainers and expert-level users. See our complete guide to Xactimate certification for details on each level, costs, and preparation tips.

5. Build Your Workflow

Once you're comfortable with the software, build efficiency into your process. Create macros for common damage scenarios. Set up templates for the claim types you handle most often. Learn keyboard shortcuts. These optimizations compound over time and significantly reduce the time you spend on each estimate.

When You Don't Need Full Xactimate

Here's a question worth asking: do you actually need to master Xactimate, or do you need to solve a specific problem?

If you're a contractor who receives PDF estimates from adjusters and needs them in an editable format to review scope and write supplements, you have two paths:

1. Learn Xactimate, get a subscription, and re-key the PDF data into a new project. This is the traditional path. It works, but it's expensive (subscription cost) and time-consuming (re-keying takes hours per estimate).
2. Use an estimate-to-production platform. CapOut converts PDFs and sends them directly to your Xactimate account in seconds. From the same upload, you get trade-level profit breakdowns, context-aware material and labor orders with real-time margin updates, and an AI Claim Assistant that writes cited responses when adjusters deny line items. You still need Xactimate to open and edit the ESX, but you skip the hours of manual data entry and gain production planning tools in the process. CapOut is free to start with 300 tokens and no credit card required.

The answer depends on your volume and your role. If you're writing estimates from scratch daily, invest in Xactimate training and certification. If you're primarily converting PDFs and reviewing adjuster scope, the conversion path saves significant time.

Xactimate Resources

Here are additional resources for deepening your Xactimate knowledge:

• Xactimate Certification: Levels, Cost & How to Get Certified - Complete breakdown of all 3 certification levels
• Xactimate Pricing: Complete Breakdown (2026) - Subscription tiers, costs, and how to choose
• Xactimate Training: Best Courses, Certification and Free Resources - Training options by format and budget
• Xactimate Free Trial and Getting Started Guide - How to access and test the software
• Xactimate Line Item Cheat Sheet: Most Common Codes - The codes you need for every estimate
• What Is an ESX File? - Everything about Xactimate's native file format
• PDF to ESX: The Complete Conversion Guide - Methods for converting PDFs to Xactimate format
• O&P in Insurance Claims - How overhead and profit works and how to fight denials
• Recoverable Depreciation Explained - Understanding depreciation in insurance estimates
• Xactimate Glossary Entry - Quick reference definition and overview

Xactimate is the tool that makes insurance restoration work. Whether you're an adjuster writing the initial estimate, a contractor fighting for proper scope, or a PA negotiating on behalf of a homeowner, the software is at the center of the process. Understanding it deeply gives you an edge in every claim you touch.