40 Years in the making!
Well, it had to change at least once.
All my professional life I’ve said one thing has never changed and that is the rates charged for standard construction buildings insurance and they were, per £1,000 rebuild sum insured:
£1.50 for Residential property
£2.00 for residential let property
£2.50 for purpose-built blocks of flats
£3.00 for shops with residential flats above
£3.00+ for high fire hazards, restaurants, takeaways, chip shops, furniture stores etc….
These rates have held firm for the last 40 years, but now that is all changing. Some rates ae going up by as much as 100% dependent on area and construction. So, what’s causing all this:
- Worldwide property rates woefully low and claims costs are increasing year on year.
- 5 Major storms since December 2019
- Insurers Solvency Margins – having to reserve more capital, so claims pot is reduced
- Cost of International Re-Insurance used to spread risk, rising rapidly
- Lowest investment rates in history means nothing to offset claims costs
- Personal Injury claims increasing with ever higher awards, so insurers reserves depleted
- Covid 19 was the icing on the cake, already estimated at £5 Billion in UK alone
Since then, Brexit has increased labour and material costs, especially in the construction industry, with the cost of steel, concrete and timber the worst, so rebuild costs are also increasing at the same time. The war in Ukraine can only lead to further instability about the supply of raw materials.
So, what can you do about property insurances you hold:
- Make sure you get a new rebuild costing, if you’re underinsured any claim will be reduced by this percentage, the responsibility lies with you, not the insurer. Do it now don’t wait until renewal of your insurance.
- Don’t wait to the last minute to review your insurances and make sure you get your renewal quote early. In most cases there is no reason why you shouldn’t get it at least 2 weeks before.
- Approach alternate broker for terms and ask for formal quotes. This is the best way to get maximum market coverage as brokers may have 20 different insurers to compare.
If you’d like to know more please just get in touch for an #openhonesttransparent review
Call 029 20 470 375 or email firstname.lastname@example.org #becauseaccidentshappen to nice people all the time.