It is important to ensure that a building has the correct type of insurance in place. A building that is under-insured can leave an owner exposed to extra costs should they need to make a claim.
When insuring a building, the insurance company will want to know an accurate cost for rebuilding the property in the event it was sufficiently damaged to have to completely rebuild it. This is in the event of an insured event such as a fire, explosion, subsidence, flooding etc. A Reinstatement Cost Assessment (RCA) is required to fully assess the cost of rebuilding a property, including additional costs such as demolition and any associated professional fees. A detailed report is produced and concludes with a declared figure for rebuilding the property to the same standard as it currently stands.
Silver Grey can undertake Reinstatement Cost Assessments for you on a wide range of properties. Please contact us if you require any further advice or would like to book in a Reinstatement Cost Assessment.
A Reinstatement Cost Assessment (RCA) is an appraisal of property for insurance purposes for the purpose of calculating the cost of rebuilding a property to the same standard as it is at the date of the RCA.
It is necessary in order to ensure a property owner insures their property for the correct amount. For example, if a property was destroyed and the owner made a claim to rebuild it, if the rebuild value declared at the point of insurance was 25% lower than the actual rebuild cost, the insurance company would only pay 75% of the cost. So, if the rebuild cost was £1,000,000, the owner would only receive £750,000 from their insurance company. A substantial amount of money to find at an already stressful time!
It is recommended by the Royal Institution of Chartered Surveyors that a Reinstatement Cost Assessment be carried out every three years.
The size and location of the building in question is assessed and considered. Cost data that is regularly updated from the Royal Instruction of Chartered Surveyors (RICS) is then used to calculate the rebuild cost. Other factors such as demolition works, professional fees and VAT are also factored in to the calculations.