Your home is likely to be your single biggest asset, and we’ve all read the horror stories about when the unforeseeable happens. Fire, flood, theft, escape of water, subsidence, accidental damage – it can be a costly affair to put things right!
Insuring your home can be a bit of a minefield, even when your requirements seem relatively straightforward!
Firstly, it’s crucial that you have the property insured for its true reinstatement/rebuild cost, not the market value (this is a common mistake). Depending on the type of property, and its location, the market value and rebuild cost can differ quite dramatically.
Listed and period buildings and homes of non-standard construction often cost more to reconstruct than modern homes built using more recent methods and materials. The cost of reinstating period features, employing specialist tradesmen and sourcing traditional building materials can be quite staggering. When assessing your rebuild cost it’s imperative to make an allowance for site clearance costs and professional fees (scaffolding can be incredibly expensive on long restoration projects).
If your home is insured for less than the full cost of rebuilding it, insurers may apply average in the event of a claim. ‘Average’ refers to a common clause often included in a home insurance contract. This clause enables insurers to reduce their liability for the damage in proportion to the amount of under insurance, thus resulting in you receiving less than full value of your insurance claim – potentially leaving you out of pocket!
So how do you calculate the re-build cost of your home?
Accurately calculating the re-instatement cost of your property is essential. If your property is of modern construction you may find the information provided by the Association of British Insurers useful. They also have an on-line calculator which can be a useful tool. See https://abi.bcis.co.uk/ for more info.
If your property is a fairly recent purchase and you had a survey carried out this document may also provide an indicative rebuild cost. For older or listed buildings we recommend seeking professional advice.
Here at Insurewise, we are on hand to guide you through the process of insuring your home. We work with a number of period property specialists and have access to the market-leading insurance products.
Many of the products we use also offer a free reinstatement assessment of your home. Once the property has been appraised by the insurer they will then give guaranteed reinstatement cover, which means that should the sum insured prove to be insufficient in the event of a claim insurer will still cover the cost of repairs in full providing you with peace of mind.
To find out more about how we can help you with your household insurance, email firstname.lastname@example.org or call 01733 325555.
Amy Bridger Cert CII
Household Insurance Account Executive