Is it normal for a contractor to charge an up-front fee for providing a written building estimate, bid or quote that is required by the insurance company?
No it is not, unless the contractor is so busy he cannot afford to do it for free. More and more insurance contractors are charging for their time because they have no assurance that they’re going to get the job, and they are busy already. Paying for an estimate is not unreasonable but the charge should be fair, whether it’s by the hour or a percentage of the estimate amount (2% to 5%). Some contractors will agree to waive the estimating fee if they are awarded the job.
Because an insurance estimate demonstrates the cost to repair the building, whether complete or not, whether correct or not, it is what is needed to establish the value of the loss and the cost of repairs.
The estimate may be preliminary and or incomplete, but it will establish the basis of any potential demand and/or claim adjustment going forward. The insurer will also reserve the right to reject it outright. You may benefit by having representation from a public adjuster and or an attorney if you believe you are being ignored or treated unfairly. Make sure the claim advocate you are considering has been vetted carefully (or recommended by someone you trust).