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If you would like us to introduce you to any of the RICS surveyors discussed below, please get in touch.

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Rebuild Cost Assessment Survey Reports

An often overlooked obligation of an insured property owner is to provide the correct declared value (the cost to reinstate a building if it were completely destroyed).

There have been some worrying statistics published over the years including research by the Royal Institution of Chartered Surveyors (RICS) in the last few years which estimated that 80 per cent of commercial properties in England and Wales were underinsured and in many examples it wasn't simply a case of being slightly underinsured. There can be some significant variations, which begs the question, why? Some possible reasons are discussed below.

• The cost of instructing a property surveyor to conduct a survey may not be factored into the acquisition budget.
• The purchaser of a property might believe it safe enough to rely on the value the vendor insured the property for.
• It may be something as simple as an administrative oversight.
• It may be that the broker has not explained the risk to the client of not getting it right.
• And last and probably worst, a misplaced belief that the insured has the option of declaring a lower declared value to save money.

Whatever the reason, if there is a property claim the insurer's loss adjuster may establish that there is underinsurance and may apply the average condition which will in turn leave the insured out of pocket (as they will have to make up the difference to ensure full reinstatement).

So what's the solution? It's very simple - budget for and conduct regular reinstatement cost assessments (RCAs) by an RICS qualified property surveyor to establish the correct declared value in time for the insurance renewal. Many property investors have an ongoing programme of RCAs for peace of mind.

There are three important benefits of having an RICS surveyor provide you with an RCA and declared value.

1. You know how much your building costs to reinstate, the value being neither too high (which would result in a premium too high and waste money) nor too low (when you would be underinsured).
2. You may be able to benefit from a waiver of the average clause in your property policy if the RCAs are done frequently enough (as determined by the insurance policy).
3. If there is not waiver of average clause and the insurer decides to apply average because it thinks the declared value is too low, then you may have a legitimate legal claim for compensation against the surveyor that provided you with the valuation.

If you are not sure who to use to conduct an RCA valuation to establish the c orrect declared value of your property, or your current surveyor has quoted you a fee that seems too high, Sirelark can point you in the direction of several RICS qualified surveying firms that may be able to help including the following:

• Rebuild Cost Assessment (National coverage)
• Cardinus (National coverage)
• Pick Everard (National coverage)
• Watsons Property (East Anglia coverage)