Buildings insurance rebuild value, is this right?

deliberately

Have you paid for your own survey? If rebuilding cost isn't on the report, go back to the surveyor and ask. You may have to pay for it. Otherwise insurance companies can estimate it for you from your postcode, building type (e.g. detached, terrace etc), size (no of bedrooms) and age. When you fill in an on-line application, there's usually a facility for working this out. Lastly, ask your new neighbour who is living in a similar property what value their insurance is based on.

Alec

The surveyors, insurers and mortgage companies use the RICS ABI/BCIS House Rebuilding Cost Index -

If you think the surveyors behaved unreasonably check their terms of engagement and get a standard copy from any industry associations the surveyor belongs to (eg RICS -

Isn't there a piece of legislation which says quotes must be provided in writing, when requested ? Presumably that would have to contain the sum insured. This sounds like dodgy practice to me - I'd ask them for a quote in writing then launch a complaint if they fail, or fail to give the sum insured.

hth

Daytona

try

this is what we give people at work if they want to know the rebuild cost and we and they dont know what it is!

James

Sadly this is standard Halifax practice and may be connected with the fact that they often just rely on 'drive by' valuations these days and that many people fail to keep their cover up to date.

the answer is not to go to the trouble of trying to estimate a reinstatement cost but to just look at one of the 'bed-room' rated policies which have no maximum re-instatement cover.

In message , Mark Hula writes

If you pay for the cheapest inspection, many lenders no longer call it a valuation, and do not include the surveyors valuation in there report to the borrower. They just tell you if, and how much, they will lend.

If they give you a quote for insurance, it is just that, a quote for insuring the building to their satisfaction.

By not giving a valuation or rebuilding cost, they are no longer leaving themselves open to being sued if the figures were wrong.

Their reports tell you, in no uncertain terms, that you should get your own survey which, at the time of making your application, would be available from the same surveyor.

"Richard Faulkner" wrote

So ... if the borrower is happy not to get their own survey done, and decides to get buildings insurance "elsewhere", how does the lender let them know whether they are happy that the insured value is sufficient?

I mean, if the lender's (secret) number is rebuilding costs are 100K, and the borrower tells them that they are getting insurance for 90K, will they say "nope, not enough"? Or would they be happy with the house being under-insured (I suspect not!).

Hence, why doesn't the borrower simply follow this course of action:

1. Tell lender they're insuring for [insert 50% of house price]; 2. Lender says "not enough"; 3. Tell lender they're insuring for [insert 60% of house price]; 4. Lender says "not enough"; ... [n]. Tell lender they're insuring for [insert X% of house price]; [n+1]. Lender says "OK!!".

I had the opposite situation, back in 1978, where the mortgagee wanted me to insure it for 20% above the purchase price. They were told in no uncertain terms that this was nonsense, since the price included the cost of the land, and the house itself had been no more than 75% of the total. In the end they settled for a rebuilding cost of 80% of the purchase price, which was still probably over the top but safe.

Nowadays the land could well be 50% or even more of the value.

Contacted Halifx again, said call the valuer. Valuer says contact Halifax. They claim that the rebuild value *doesn't exist* i.e. they simply don't have one. So what worries me is I *pick* a rebuild value (perhaps using one of the on-line programs as suggested) then when I exchange they could complain the property is under insured!!!!. I got put through to over 7 people, with no help what-so-ever!, all I need to be given is 1 NUMBER!!!. Sigh.....guess I shall decide what the rebuild cost is myself.

>

Why not try

rebuild%20cost%20matrix%20Mar%202003.pdf ?

It's not, by definition, "nonsense" for rebuilding costs to exceed purchase price. The former has to include the costs of removing whatever is left after whatever disaster has befallen the house, for a start. It is calculated on the basis of floor area, construction style, and prevailing rebuilding rates (which you can guarantee are a darned sight more than building rates due to the distress nature of the contract). The purchase price is a purely market driven entity, although if it falls far enough the site will be ripe for redevelopment.

[I sense you may have been referring to a new build. Even so, you have to factor in the site clearance costs and the difference between build and rebuild rates.]

I was. However you may also like to consider that demolition to ground level and rebuilding would not entail re-doing the foundations or groundworks.

The current indicated rebuilding rate suggests that the cost for our house would be about 1/3rd of the selling price.

But if there is a serious failure of the foundations they will need redoing.