Is your property underinsured?

As many as 9 out of 10 properties in the UK are insured for the wrong amount, what are the potential consequences of underinsurance and how can PIB Insurance Brokers help you to avoid them?

Is Your Property Underinsured?

Is your property underinsured?

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What is underinsurance and what are the consequences?

Property underinsurance occurs when a property is insured for less than the total cost to rebuild it. If your property is found to be underinsured following a damage claim, insurers could reduce the value of the claims settlement proportionately in line with the amount of underinsurance or in a worst-case scenario consider the under insurance to be materially misleading and refuse to pay any of the claim.

Common causes of underinsurance

  • Building sum insured mistakenly based on the market value of your property, or a mortgage valuation. For insurance purposes your building sum insured should always be based on the rebuilding cost.
  • Where a property has never been professionally valued for insurance purposes or the valuation has not been reviewed in the past three years.
  • You have altered or extended the property but not subsequently reviewed your buildings sum insured.
  • The rebuilding value of your property should cater for costs such as professional fees, site clearance and the replacement costs of periphery items such as gates, fences or car parking areas and any other items as included within the definition of buildings under your insurance policy.


How we can help?

We have partnered with Royal Institute of Chartered Surveyors (RICS) accredited specialist companies who offer rebuild cost assessment options to suit your specific needs. There are two forms of assessment available:


Site survey

A site survey involves a visit to the premises and is the most accurate means of valuing property for insurance purposes. This method should particularly be considered where there are multiple buildings or where the construction is non-standard or where properties have listed status.


Desktop assessment

A desktop assessment utilises satellite imagery and multiple data points to produce a comprehensive report without anyone visiting the premises. A desk top assessment offers a cost-effective option for less complex buildings.


Whatever the selected assessment method, if you own or are responsible for insuring your property it is vital that it is insured for the correct amount. This will ensure you are not underinsured or even over insured and minimise the risk to your business in the event of a claim being made.

To find out more, please contact your local branch of PIB Insurance Brokers.