Many of us are accustomed to estimating the value of our contents when reviewing our home insurance, but how confident are you that you’ve correctly estimated the costs for rebuilding your home?

Unless it’s your profession, it may not be something you’re very familiar with, but it’s the homeowner’s responsibility to make sure the chosen insured amount is enough to cover the cost of a disaster. This is known as the ‘sum insured’, and it’s the maximum amount that an insurance company will pay out.

For particularly high-value, larger or more unusual homes, calculating an accurate rebuild sum can be challenging.

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In the event of needing to rebuild part, or all, of your property and the sum insured is too low, you could be required to make up the shortfall, which could be thousands of pounds.

Key considerations

So how can you make your way to a confident rebuild value? Here are some of the things to look out for and consider to help prevent underinsurance of your building:

  1. Be mindful of mortgage valuations and market values as neither of these are indications of what it will cost to reinstate the property and are therefore likely to be an inaccurate estimate for rebuilding costs.
  2. Listed buildings status or a conservation area location may require additional permissions and specialist craftsmen and materials.
  3. The property’s construction materials - for example, stone or non-standard materials such as ‘green’ or ‘high tech’ can be unique and difficult to obtain.
  4. Extensive outbuildings, garages, store sheds, brick walls, courtyards, driveways and even tennis courts need to be included in the valuation.
  5. The age of the property.
  6. The fixtures and fittings within the property and any recent extensions, alterations or refurbishments.
  7. The location and access to the building and site.

If you are in any doubt as to the accurate rebuild value of your property, please consult a surveyor.

It’s worth knowing that…

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Provided you have a valuation that’s no more than three years old, and you insure your building for the amount advised by the buildings valuation provider, NFU Mutual Bespoke Home Insurance provides ‘underinsurance protection’ for your building which can help you by covering the full cost of repairs or reinstatement following any damage to your building, even if it’s more than the amount it’s insured for. And if your property is a listed building, we’ll pay up to 125 per cent of the insured rebuilding cost.

To find out more about NFU Mutual Bespoke Insurance call 0808 231 2820, or search: NFU Mutual Bespoke Home Insurance 

The National Farmers Union Mutual Insurance Society Limited (No.111982). Registered in England. Registered office: Tiddington Road, Stratford-upon-Avon, Warwickshire CV37 7BJ. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. A member of the Association of British Insurers.