Assessment of rebuild-value for Buildings Insurance

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    #16
    Originally posted by quarterday View Post
    Anniebea :

    As regards rebuilding revaluations for fire policies, in my view, three yearly is too frequently for the cost of a valuation to be added to the service charge. In general it is in your interest to have a valuation done, albeit more occasionally, perhaps once per decade; and I am of the view that three yearly is unnecessarily frequent.
    Glad to see someone who agrees with me - see post. It seems to be gospel according to the various universities.
    Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

    Comment


      #17
      Originally posted by anniebea View Post

      In my lease in the lessors covenants it states to pay all existing and future rates assessmnets and outgoings now and hereafter imposed or payabale in respect of the Reserved property.

      I assume that the Common areas of the building are part of the reserved property - ie they belong to no lessee then surely any risk assessment in repect of the common areas is the responsibility of the lessor ie freeholder and this clause says they are responsible. Should they also be responsible for the electric test for the electrics that are in the common area.
      What you have seen is correct, however reading other parts of the lease you will find an obligation to meet these charges, eg tenants covenants to pay service charge, perhaps listed or set out in a further schedule. Sadly you have to read the lease front to back and then again to put all the parts together.

      Unfortuantely this is how leasehold property works you look after your flat and pay a share towards the rest that you use/benefit from.
      Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

      Comment


        #18
        Originally posted by funkster View Post
        What is the best way to go about assessing rebuild-value for Buildings insurance purposes?

        Leaseholders in this block of 4 flats are in the final stages of taking over Freehold by enfranchisement, and I have been trying to get quotes for new Buildings Insurance.

        I found out from the Managing Agent the estimated rebuild-value used for Buildings Insurance, which I was told is also the sum insured. Through a broker, I got several quotes from major insurers which are very considerably lower than what we currently pay.

        However, when I mentioned the subject to a couple of surveyors (in connection with another matter), they said the rebuild-value/sum assured, and hence the quotes, sounded much too low.

        It therefore appears we should get a new, independent assessment of the re-build value so that we do not end up under-insuring.

        The two surveyors mentioned could provide this, in conjunction with a report about the general structure of the building (which some leaseholders want : - the other matter I had initially phoned to discuss).

        As the OP, I would like to return to my original question as above.

        I have now had a professional rebuild valuation done for a fairly modest fee as it was part of a structural survey of the entire building.

        This gives the rebuild valuation as 1.65 million, as opposed to 320,000 we are currently insured for by the freeholder, from whom we are trying to separate, so it appears we have been drastically under-insured for many years.

        Still, I am a rather taken aback by the size of the valuation. That's not only because it is several times more than our current insurance, but also several times more than the nearest "model" I can find on the BCIS rebuilding cost calculator, which gives a figure of about 500,000. I realize that calculator states it is not intended for blocks of flats; however, the figure is also about a million more than the "rough rule of thumb" of multiplying internal square footage of about 3000 square feet by 200, as recommended by poster Quarterday and also another surveyor I asked.

        On the other hand, yet another surveyor I asked about this recommended simply insuring the building for its full market value, supposedly about 2 million.

        So I feel rather confused by all this, and since the surveyor didn't show any calculations and I can't discuss it with him till next week, I thought I would just ask here if the figure of 1.65 million as a suitable rebuild-value for a mid-Victorian 6 storey property in central London roughly squares with the experience of others (granted that more details are needed).

        Comment


          #19
          Well market value has nothing to do with rebuilding costs so ignore that.

          The House building table does not take account of simple things like there is 1 or 2 bathrooms and 1 kitchen per apartment rather than the usual 1 per house.

          The rate used is variable simply due to quality, to the cost of site clearance and rebuild in a terraced scheme with little or no access is very different to a detached one, nor can it take account of local factors such as the nearby tube line soil make up mature trees and a host of other more technical issues.

          Take it up with the surveyor when they return, but in the meantime put the freeholder on notice, and talk to your lender to increase the cover they have short term, just in case there is an incident.
          Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

          Comment


            #20
            advice

            i live in a block of six flats we are lease holders who all own share of freehold. we have managing agent who tells us it is a legal requirement from the insurance company that we have to do have an insurance revaluation every 3 years, and a health and safety risk assessment is another legal requirement. is this all true or are they just trying to rip us off for other services.
            cheers jon

            Comment


              #21
              Insurance Rebuild Valuations

              Hi betty7091

              There's no legal requirement to have a rebuild valuation done. It's possible that the insurers have made it a contractual requirement that one is done - very unlikely. However if one hasn't been done for a long time it would be prudent to arrange.

              H&S risk assessment is a legal requirement and should especially include Fire and Asbestos risk assessments.

              Ask the managing agent to get 3 quotes.

              Hope that this helps.

              Comment


                #22
                thanks jon

                Comment


                  #23
                  Originally posted by paulb67 View Post
                  Hi betty7091

                  There's no legal requirement to have a rebuild valuation done.

                  H&S risk assessment is a legal requirement and should especially include Fire and Asbestos risk assessments.

                  Ask the managing agent to get 3 quotes.

                  Hope that this helps.
                  Hold that is a reckless mistatement. There are

                  1: Contractual obligations to insure which if not explicit such as full reinstatement value, are implied.

                  2: The landlord or person in control has a legal obligation and duty of care to ensure that any obligation is met.

                  The only way to assess is to have a revaluation.
                  Based on the information posted, I offer my thoughts.Any action you then take is your liability. While commending individual effort, there is no substitute for a thorough review of documents and facts by paid for professional advisers.

                  Comment

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