Research consistently shows that around 80% of UK homes are under-insured for buildings insurance. That's a staggering figure — and it means that in the event of a major loss, hundreds of thousands of homeowners would face a shortfall between their insurance payout and the actual cost of rebuilding. Here's what you need to know.
The Critical Difference: Market Value vs. Rebuild Cost
Your buildings insurance should be based on the rebuild cost of your property — the cost of demolishing what remains and constructing an equivalent replacement from scratch. This is almost always different from your property's market value.
In many parts of Basingstoke and Hampshire, market values are high relative to rebuild costs — meaning if you insure for market value, you're likely over-insuring. But in areas with expensive or unusual building types (Victorian terraces, thatched cottages, listed buildings), rebuild costs can actually exceed market values significantly.
Using market value as the basis for your buildings insurance premium is a common mistake — and one that can leave you badly exposed when you need to make a claim.
Why Are So Many Homes Under-Insured?
There are several common reasons:
- Using market value — The most common error. People insure for what the house would sell for, not what it would cost to rebuild.
- Never updating the figure — Construction costs have risen significantly in recent years, particularly following supply chain disruptions. A rebuild cost assessment from 10 years ago will be woefully out of date.
- Using an online calculator — Generic online calculators don't account for the specific characteristics of your property: its age, construction type, fixtures and fittings, or any unusual features.
- Extensions and improvements — If you've added an extension, kitchen or bathroom since you last reviewed your insurance, your rebuild cost will have increased.
What's Included in a Rebuild Cost?
A professional rebuild cost assessment considers:
- Demolition and site clearance costs
- External walls, foundations and substructure
- Roof structure and coverings
- Internal walls, floors and ceilings
- All fixtures and fittings (kitchens, bathrooms, etc.)
- Windows and external doors
- Services (heating, plumbing, electrical)
- Outbuildings and boundaries (where included in cover)
- Professional fees (architect, structural engineer, etc.)
- VAT on construction costs
The total is expressed as a rebuild cost per square metre multiplied by the gross internal floor area of the property.
When Should You Get a Rebuild Cost Assessment?
We recommend getting a professional rebuild cost assessment:
- When buying a new property
- Every 3–5 years for ongoing review
- After major works, extensions or renovations
- When renewing buildings insurance if you're unsure of the current figure
- For listed buildings, unusual construction, or properties with high-specification finishes
What Does It Cost and How Long Does It Take?
A professional rebuild cost assessment by a RICS registered valuer is typically completed within a few days of instruction, with the report delivered within 3–5 working days. Costs are modest relative to the protection it provides — typically starting from around £150–£250 for a standard residential property.
For properties that already have a RICS homebuyer report or building survey, the rebuild cost can often be incorporated into that survey — ask us about this when requesting your quote.
Get a Rebuild Cost Assessment in Basingstoke
Our RICS registered valuers provide rebuild cost assessments across Basingstoke and Hampshire. For full details of our valuation services, see our property valuation page, or contact us for a free quote.
