Roughly nine in 10 households have underestimated the amount of cover they need on their property insurance to rebuild their property10. This under insurance could leave homeowners seriously out of pocket in the event of a fire or other unforeseen event damaging their property.
The insurance value of a property isn’t based on its mortgage valuation or a percentage of its market value – it’s based on how much you would need to rebuild the home from scratch, including the cost of clearing the site. Rebuilding costs have shot up by 18% in a year, largely due to an increase in the cost of materials such as insulation (up by 62%), windows (49%) and plasterboard (46%). These soaring prices have resulted in the average three-bed semi-detached home now costing £53,000 more to rebuild than it would have in February 2022.
*Building Cost Information Service, 2023
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