12 May 2022

When should you get a building valuation on your rental and why?

By Kevin Meek New Business Senior Account Handler

Keeping your rental properties protected with the right buildings insurance is just part and parcel of being a landlord – offering a safety net that if disaster strikes and your property is damaged or destroyed, you’ll have the funds to rebuild it.

But did you know the rebuild cost and the market value of a property are very different? This means it’s all too easy to underinsure your rental, and this could cause some serious problems if you need to claim.

Don’t worry, at Protect My Let, we’re here to help. So let’s run through the different types of property valuation, how to calculate rebuild cost and why booking a rebuild valuation should be on your to-do list.

What your building ‘sums insured’ actually means – and why it matters

Most building insurance policies have a total ‘sums insured’ value – which represents the maximum amount your insurer will pay out in the event of a claim. Crucially, this amount needs to cover demolition in the event of total loss, the full reinstatement cost of the building and any extra structures, like your boundary walls, to make sure there’s enough cover to fund the rebuilding of your property from scratch if it’s completely destroyed, for example by fire.

If you don’t have enough cover (i.e. you’re underinsured), not only will you have a shortfall when it comes to rebuilding your property, but your insurer is also entitled to apply what’s called a ‘law of average’ and reduce what they do pay out proportionately. This could leave you even more out of pocket.

What’s important to understand is that rebuilding your property is likely to cost much more than you paid for it – especially as the costs of building materials and labour has gone up over time.

So rather than relying on your initial mortgage valuation from when you first bought the place or making a rough estimate based on the current property market, instead you need to calculate an up-to-date rebuild cost. This is the only way to make sure you have the correct figure on your insurance policy – and that’s where a rebuild valuation comes in.

What’s a rebuild valuation and when should I get one?

A rebuild valuation, or buildings insurance valuation, is a service carried out by a chartered surveyor to give you an accurate idea of what it would cost to rebuild your whole property if it was completely lost.

It’s different to a property valuation for a mortgage lender – when a property is assessed to see if it’s worth the purchase price in the current market – and different from a survey, which is more of a ‘health check’ of a property to identify any problems, usually before a purchase.

As a rule, you should consider having your property evaluated every three years but due to the pressures of the pandemic, many insurers now need you to have one within the last 12 months to account for the higher prices of materials and labour.

Plus you should consider getting an up-to-date valuation whenever you make significant alterations to the property, for example a loft conversion or extension, as this will impact the costs of reinstatement.

So if you haven’t had your property building valuation calculated recently, or you’ve made some significant changes to your rental in the meantime, you should really get one booked in sooner rather than later.

How do I arrange a valuation and how much do they cost?

There are a range of ways you can arrange a building valuation – you can either hire a surveyor to view your house in person (the more expensive option) or you can get an online valuation from a dedicated supplier.

Here at Protect My Let, we work with Barrett Corp & Harrington (BCH) who have extensive experience in rebuild valuations and offer top quality service. They provide hassle-free e-valuations that are designed to establish an accurate rebuild value of your property in a fraction of the time – and, for Protect My Let customers, at a fraction of the cost.

That’s because we’ve discounted the price to just £105 + VAT for our customers – to help make it easier for our valued landlords to make sure their insurance is enough for their needs.

Give us a ring to find out more

If you’re renting out a property and you haven’t had a recent building valuation, then give us a call. You’ll talk to one of our friendly team (we’re real people, not robots) who will be able to help you out and get you a quick and easy buildings insurance valuation done (at a discount).

Plus, we’ll be able to give you expert advice on the best ways to protect your rental too. Because that’s what we’re here for. Just call 01206 655899.

House with cloud

Need to speak to someone about landlord insurance?

You can find further useful information, get in touch with a member of our team, or submit an enquiry on our landlord insurance page.



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