29 August 2025
How Insurance Brokers Add Value with Co-Branded Rebuild Reports
7 August 2025
Average Clause in Insurance: What It Means, How It Works & Why It Matters
29 August 2025How Insurance Brokers Add Value with Co-Branded Rebuild Reports
7 August 2025Average Clause in Insurance: What It Means, How It Works & Why It Matters
29 August 2025Understanding the Insurance Reinstatement Valuation
How To Avoid the Average Clause Penalty With Insurance
The Reinstatement Cost of the Property Matters More Than You Might Think
Let’s get one thing straight: when disaster strikes, your insurance policy better have your back. But here’s the kicker - if your property’s insured value isn’t spot on, you might be in for a nasty surprise. Enter the insurance reinstatement valuation - the unsung hero of property protection. It’s not just a number; it’s a safeguard against financial loss, claim disputes, and the dreaded Average Clause.
Whether you're a homeowner, landlord, or business owner, getting your house valuation for insurance right is critical. That figure, often mistaken for market value, is the cost to rebuild from scratch, including bricks, mortar, fittings, labour, and professional fees.
At Exactum, we often see clients fall into the underinsurance trap. That’s why we’re making it our mission to demystify the process.
Let’s Clear This Up: What Does It Actually Mean?
A proper insurance reinstatement valuation is your financial seatbelt. It estimates the cost to rebuild your property on a like-for-like basis, factoring in current construction rates. This is NOT the market value of your home or building - it’s a completely separate beast.
Think:
- Demolition and site clearance
- Architect and engineer fees
- Labour and materials (subject to inflation)
- Compliance with modern building regulations
A rebuild cost that's too low could trigger the Average Clause, which allows insurers to reduce payouts proportionally if the sum insured is underestimated. That’s why a Rebuild Cost Assessment, either desktop or on-site, is more than a nice-to-have; it’s essential.
When Should You Get an Insurance Reinstatement Valuation?
There’s no fixed rule, but these red flags are solid reasons to act:
- Major refurbishments or extensions
- A new property purchase
- Insurance policy renewal
- Inflation spikes or supply chain disruptions
- Local authority upgrades or changes to building codes
- Local authority upgrades or changes to building codes
If any of these sound familiar, don’t wait. It could be the difference between full protection and a costly shortfall.
Questions and Answers
Is Market Value the Same as Reinstatement Value?
No. Market value includes land and local demand; reinstatement value reflects the cost to rebuild the physical structure only. Insuring for market value could lead to overpayment, while underestimating rebuild cost risks underinsurance.
What is the Average Clause in Insurance?
The Average Clause reduces your claim payout if you're underinsured. For example, if you're insured for 50% of the actual rebuild cost, you’ll only receive 50% of any claim - even for partial damage.
How Do I Calculate My House Value For Insurance?
Use a professional Rebuild Cost Calculator or commission a full Rebuild Cost Assessment. Online tools can help, but for accuracy, a RICS-compliant report from providers like Exactum is ideal.
How Often Should a Reinstatement Valuation Be Updated?
Experts recommend reviewing your valuation every 3–5 years - or immediately after renovations, extensions, or market shifts in construction costs.
Can Landlords and Businesses use Reinstatement Valuations?
Absolutely. Commercial, rental, and mixed-use properties all require precise reinstatement valuations to avoid exposure and protect investment value.
Do I Need a Reinstatement Valuation if I Haven't Made Changes to my Property?
Yes - construction costs fluctuate regularly. Even without property alterations, the rebuild value can increase due to inflation, material scarcity, or regulatory changes. Regular reviews are essential.
Can I Do a Reinstatement Valuation Myself?
You can try using online calculators, but they offer general estimates. For accuracy and insurance compliance, it's best to use a professional service like Exactum.
Common Mistakes That Lead to Underinsurance
Despite good intentions, many property owners unknowingly undervalue their buildings when arranging cover. Here are the usual suspects:
- Using market value instead of rebuild cost
- Skipping valuations for years on end
- Overlooking outbuildings, garages, or high-end fittings
- Assuming insurers will cover any shortfall automatically
- Misjudging demolition, debris removal, or architectural fees
These oversights can all lead to shortfalls that trigger the Average Clause. The fix? A detailed, up-to-date insurance reinstatement valuation from professionals who know what to look for.
How Exactum Helps You Get It Right
At Exactum, we’re on a mission to stop underinsurance in its tracks. Our Rebuild Cost Assessments are fast, accurate, and RICS-compliant - meaning they follow the industry gold standard.
We offer:
- Desktop assessments for fast, affordable reporting
- Site-based surveys for complex or bespoke properties
- Volume packages for landlords and portfolio owners
- Co-branded broker services for insurance partners
Our reports are easy to read, tailored to the property, and turned around quickly - often in under 10 working days. They’re backed by robust methodology, using BCIS cost data and real-world insights. And because we cut the jargon, you and your insurer know exactly where you stand.
Need to stay ahead of inflation? Concerned your building isn’t covered properly? Just want peace of mind? That’s what we’re here for.
Ready to Protect What Matters?
Beyond individual property assessments, Exactum also supports:
- Portfolio audits for landlords with multiple properties
- Insurance brokers looking to add value and reduce client exposure
- Commercial premises where rebuild complexity is high
All our work is designed to give you clarity, confidence, and compliance.
Take the next step with Exactum:
Don’t gamble with guesswork. Get a professional valuation and secure your property with confidence.
Take the next step with Exactum:
- Request a rebuild cost assessment
- Explore our services
- Speak with our team for tailored advice
For homeowners, landlords, and business owners alike - Exactum is here to help you get it right. Every time.
Call 0800 028 0695 and talk to our friendly team today.
