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With construction costs continuing to rise, many property owners could be unknowingly underinsured. If your building has not been professionally reassessed in recent years, the cost of rebuilding it may now be significantly higher than the figure stated on your insurance policy.
An inaccurate reinstatement value can leave owners facing a substantial financial shortfall following a major loss. On the other hand, overestimating the value could mean paying more for insurance than necessary. A Reinstatement Cost Assessment (RCA) helps ensure your property is insured for an appropriate rebuilding cost, providing confidence that adequate funds would be available if the worst were to happen.
The reinstatement value of a property is not the same as its market value. Instead, it reflects the cost of rebuilding the property from scratch, including associated external works and site infrastructure where applicable. As material prices, labour costs and construction inflation continue to fluctuate, these figures can quickly become out of date.
For this reason, industry best practice recommends:
At GFW, we provide Reinstatement Cost Assessments for residential, commercial and mixed-use properties across the UK. Depending on the property and the information available, assessments can be carried out through either a physical inspection or a desktop review.
A physical assessment involves a site inspection and measured survey, allowing our Building Surveying team to accurately assess the property’s size, construction and specification.
Where suitable information is already available, a desktop assessment can be undertaken using floor plans, supporting documentation and any previous assessments. This can offer an efficient way to review insurance values without the need for a site visit.
For commercial property owners and landlords, obtaining an up-to-date Reinstatement Cost Assessment is not only good risk management, but the cost of the assessment itself may also be recoverable from tenants, depending on the terms of the lease.
Our assessments are prepared in accordance with the RICS Guidance Note – Reinstatement Cost Assessments of Buildings (3rd Edition) and are reported on a Day One basis. Each assessment includes consideration of anticipated rebuilding periods and provides a robust figure to support insurance arrangements.
Whether you own a family home, an investment property, commercial premises or a mixed-use building, an up-to-date Reinstatement Cost Assessment can help ensure your insurance cover keeps pace with changing construction costs and provides the protection you expect when you need it most.
To discuss a Reinstatement Cost Assessment or request a quotation, contact James Thompson and the GFW Building Surveying team.
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