News Article

You Really Cannot Ignore Rebuild Cost Inflation!

A number of factors have coincided to mean that rebuilding costs have hit record highs and the risk of underinsurance is now greater than ever.

You cannot afford to ignore rebuild cost inflation!

Your sums insured have to be adequate for your businesses to survive a major loss.

Underinsurance has always been an issue for insurers and policyholders.

The Association of British Insurers suggests 20% of household policies are underinsured whereas various professional valuation services suggest that figure rises to 60-70% of commercial risks due to the complexities of commercial covers.

Common Indicators that you may be underinsured include:

• The building has not had a professional valuation within the last three years and/or hasn’t had the appropriate index linking applied.
• The building is listed, made of quarried stone or certain non-standard construction methods.
• The building is in a remote location or with restricted or difficult access.
• The property is finished to a significantly higher standard than normal.
• The property has modern eco-friendly construction or green energy features.
• The Business Interruption indemnity period is only 12 months.
• You haven’t factored in costs for outbuildings, car parks, driveways, gates, fences, boundary walls, paving or lighting.
• You haven’t factored in costs such as professional fees, site clearance or access costs. This could extend the rebuild period which needs to be factored into the Business Interruption cover.

For more information about protecting your company against underinsurance please contact Nigel Kennedy on 07951 120328 or email nkennedy@reesastley.co.uk

Source Arch Insurance

 

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