Did You Know?
It is becoming increasingly common to find out at the time of a claim that a property is under-insured. Barrett, Corp & Harrington who specialise in Insurance Valuations carried our some research for Aviva (formally Norwich Union). In an analysis of their work, they uncovered that the vast majority of premises were under-insured. Martyn Barrett, the Director of Barrett, Corp & Harrington made the following comment:
 
'It is both interesting and worrying .... that the origins of building sums insured are often unknown and shrouded in mystery. A frequent answer, however, is that the sum insured was based on a bank or market valuation. Such an approach is totally inappropriate for insurance purposes and likely to lead to significant under-insurance or over-insurance with resultant consequences'
 
Did you know?
In addition to the normal costs (materials, labour etc) you would associate with having to rebuild a damaged property, the following additional costs will also need to be factored in when deciding on the correct sum insured for your buildings:
 
Removal of Debris. Nowadays with modern materials, the concerns surrounding asbestos, waste legislation and the spiralling cost of disposal, it is suggested that the cost of demolishing and removing the debris following a fire would add over 11.5% to the cost of reinstatement.
 
Architects and Surveyors Fees. It is estimated that architects and surveyors fees would add around 8.5% to the cost of reinstatement.
 
VAT may need to be added.
 
Did you know?
The main impact underinsurance has for Property Owners is that they will he held liable for any shortfall for a property to be reinstated. Property Owners are normally obligated to make sure that a property is insured for the full cost of reinstatement.
 
As well as not covering the full settlement cost, under-insurance can also lead to claims delays while investigations are carried out, which often leads to increased costs.  

What can you do to check if your buildings are adequately insured?

To check that you have adequate insurance to cover the rebuilding sum insured for your home in accordance with that recommended by the Association of British Insurers we recommend that you use the calculator on the Association of British Insurers’ website: http://abi.bcis.co.uk  or contact your local TIC office where our staff will be happy to assist you in recommending your correct rebuilding sum insured or an alternative home buildings policy that offers a blanket sum insured of up to £500,000 thus ensuring that you never suffer from an under insurance valuation in the event of a claim on your buildings providing the rebuilding value of the insured property does not exceed this amount.

Should you require a professional property valuation then please contact your local TIC office as we have negotiated specially agreed competitive rates/ fees with local surveyors who are experts in this field and they will be pleased to contact you to discuss and provide you with a professional valuation of your property.

 If you have any questions or queries relating to your Home Insurance Policy then please contact your local TIC office where our staff will be happy to assist you.