Be careful not to under-insure your building
Clients often under-insure their buildings as they don’t consider the following factors that impact rebuilding costs:
• Building parts and labour costs
• Transportation costs
• Costs related to planning and construction
• Debris removal and site clearance
• Contractor profit margins.
To help clients make sure their buildings are adequately insured it is best to discuss the current building costs with a builder who knows your area. Remember to take into account your boundary walls, outbuildings as well as paved areas.
Buildings sum insured should be reviewed every year at policy anniversary. Buildings costs are subject to inflation and clients need to make sure they are covered for the replacement value at the time of rebuilding their house, which may be at the end of the year (for example, 12 months from the current date).
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