Trying to calculate House rebuild cost for insurance

gazzer

I recently changed insurance providers for my home rebuild insurance from Bank of Ireland (who we have our mortgage with) to Zurich.

We had initially insured for €225,000 but that was 2 years ago so this year we decided to insure for €200,000.

Anyway I got a letter from Bank Of Ireland instructing me to get my insurance back up to €225,000.

When I rang them up to question this I was told that they would only accept the word of a surveyor or else I could go onto the Chartered Surveyors website to get a quote from there and print it off and send it into BOI?

I live in Cavan though and there are only a few counties listed on the SCSI website for calculating rebuild cost and Cavan is not one of them.

Has anybody any ideas of other sites I could use to calculate the rebuild cost?

Thanks

BryanF

http://www.bruceshaw.com/communicraft-cms-system/uploads/BS-handbook-2011.pdf

p31

focus_mad

OP, the reinstatement amount is meant to be for the cost of rebuilding the house if it burnt down in th morning.

If say it worked out at 190k then you should alter your insurance accordingly as if you keep your insurance at the bank requested 225k then you will be paying a high insurance premium even though it won't ever cost this.

gazzer

focus_mad wrote: »

OP, the reinstatement amount is meant to be for the cost of rebuilding the house if it burnt down in th morning.

If say it worked out at 190k then you should alter your insurance accordingly as if you keep your insurance at the bank requested 225k then you will be paying a high insurance premium even though it won't ever cost this.

Thats my issue though. We bought the house for €225,000 2 years ago. With the current market I dont think the rebuild cost will be that high which is why when I changed insurance providers I got insurance for a rebuild of €200,000. However BOI wont accept that. They say I have to get a surveyor to value the house or else I have to go onto the Chartered Surveyors website and put calculate the rebuild cost from there. On that site there are only a few counties mentioned though. Cavan isnt one of them

gazzer

BryanF wrote: »

http://www.bruceshaw.com/communicraft-cms-system/uploads/BS-handbook-2011.pdf

p31

Thanks for that link but there are only 5 counties listed there. Should I just use the cheapest per sq metre price to do the calculation? If so it means that the rebuild cost for my 250 Sq Meter house is over €300,000 :eek: We bought the house for almost €100,00 less

Gurgle

OP, You're right in principle but wasting your time.
There's little if anything in the difference to the cost of the policy.

Gurgle

gazzer wrote: »

Thanks for that link but there are only 5 counties listed there. Should I just use the cheapest per sq metre price to do the calculation? If so it means that the rebuild cost for my 250 Sq Meter house is over €300,000 :eek: We bought the house for almost €100,00 less

I guess that's why its called the BS handbook.
My house would cost more to rebuild than it was ever worth

BryanF

gazzer wrote: »

Thanks for that link but there are only 5 counties listed there. Should I just use the cheapest per sq metre price to do the calculation? If so it means that the rebuild cost for my 250 Sq Meter house is over €300,000 :eek: We bought the house for almost €100,00 less

guys your missing something here... its the rebuild costs

it means they have to clear the site and rebuild the same footprint to current standards including all professional fees.. which may be more or less than you bought or built for and has little to with what you feel your house is currently worth..

Gurgle

I'm not missing anything here, they're providing massively exaggerated numbers because they want to give people the 'Bargain' feeling while still profiteering at boom-time margins.

This publication is a brochure / sales pitch not an information leaflet.

BryanF

Gurgle wrote: »

they're providing massively exaggerated numbers because they want to give people the 'Bargain' feeling while still profiteering at boom-time margins.

This publication is a brochure / sales pitch not an information leaflet.

can you provide us with a rebuild 'number' you feel is not exaggerated?

can you offer a more appropriate information leaflet?

Gurgle

BryanF wrote: »

can you provide us with a rebuild 'number' you feel is not exaggerated?

Experience:
I got an extension of 36 sqm built last year and had several quotes of ~€30k.

That's €833 / sqm. While its not the same thing, I think its comparable. There are costs in a new build that don't apply to an extension and vice-versa.

These were detailed itemized quotes. I did also get a few 'multiply size by cost per sq meter' types quotes, which were in the €45k to €60k range.

Logic:
A serviced site is a big chunk of the cost of a home. Rebuilding is starting again from a serviced site, ergo the rebuilding cost must be significantly less than the value of the property.

can you offer a more appropriate information leaflet?

Nope.

focus_mad

OP, if you wish, PM me your house details and I can do an assessment for you as a guide price if you wish.

It's unusual that BOI have said that to you. I did an assessment on my parents' two properties and saved them a large amount on their premium. They are aware however that as construction costs rise, they would in turn have to re-assess the insurance premium.

Gurgle I'm not missing anything here, they're providing massively exaggerated numbers because they want to give people the 'Bargain' feeling while still profiteering at boom-time margins.

This publication is a brochure / sales pitch not an information leaflet.

They are not "massively exaggerated" IMO. I fail to see the profiteering angle if I must be honest.

A typical Reinstatement Assessment would include;


• Normal substructures and foundations
• Superstructures
• Normal services below ground floor slab
• Plumbing and electrical installations
• Heating
• Air conditioning
• Kitchen Fittings, tea stations
• Sanitary fittings and services
• Applied floor, wall, and ceiling finishes and decorations.
• Demolition, shoring, protection and site clearance
• Professional fees and Local Authority planning charges

Additions may also have to be added if the property is a Protected Structure.

Gurgle

Fair enough, I'm not in the trade so will bow to your greater knowledge. I was obviously just very lucky with the builders I've dealt with.

sydthebeat

Gurgle wrote: »

Experience:
I got an extension of 36 sqm built last year and had several quotes of ~€30k.

That's €833 / sqm. While its not the same thing, I think its comparable. There are costs in a new build that don't apply to an extension and vice-versa.
.

€833 per sq m might be a good quote for a builders finish... but wouldnt cover a new house with all decoration, fittings and fixtures.

There is a certain element of "how long is a piece of string" in these things as some houses are bog standard and others are high spec.

On balance the figures quotes should be considered fair.

SRM027

sydthebeat wrote: »

€833 per sq m might be a good quote for a builders finish... but wouldnt cover a new house with all decoration, fittings and fixtures.

There is a certain element of "how long is a piece of string" in these things as some houses are bog standard and others are high spec.

On balance the figures quotes should be considered fair.

Hi,

Can I also add/ask will that also cover alternative accommodation?

My mother not long ago was out due to a fire in the attached house causing damage to hers. The insurance covered the reinstating of the house AND alternative accommodation which she got near to her own home.

The whole process meant she had to rent and store furniture for 9 months, at no cost to her, all under the insurance.

Just a thought and a worth asking about

sydthebeat

this thread is about the 'reinstatement costs' of rebuilding a damaged house.

to be honest i have no idea what is covered under a house insurance policy but id be very surprised if it doesnt cover temporary rent costs

SRM027

Sorry, did not mean to go off topic.

I came across this, might be of some help from RSA In Ireland !!

http://www.rsagroup.ie/RebuildingCalculator/RebuildCost.htm

Thanks

Duffers11

In the process of getting policies for mortgage requirements at d mo. The mortgage is €155k and the value upon completion is €360k as per valued. God forbid anything happened, the banks insist that I must get an insurance with a rebuild cost of €420k. To me this is crazy and when I questioned them on it, they didn't really have an answer, just insisited that it had to be covered for €420k as per the valuer to get the mortgage! What yis think??

sydthebeat

Duffers11 wrote: »

In the process of getting policies for mortgage requirements at d mo. The mortgage is €155k and the value upon completion is €360k as per valued. God forbid anything happened, the banks insist that I must get an insurance with a rebuild cost of €420k. To me this is crazy and when I questioned them on it, they didn't really have an answer, just insisited that it had to be covered for €420k as per the valuer to get the mortgage! What yis think??

whats the size of the house? and location?

Duffers11

sydthebeat wrote: »

Duffers11 wrote: »

In the process of getting policies for mortgage requirements at d mo. The mortgage is €155k and the value upon completion is €360k as per valued. God forbid anything happened, the banks insist that I must get an insurance with a rebuild cost of €420k. To me this is crazy and when I questioned them on it, they didn't really have an answer, just insisited that it had to be covered for €420k as per the valuer to get the mortgage! What yis think??

whats the size of the house? and location?

It's 2700 sq ft in Wicklow. I rang another valuer for a second opinion and they also said that for rebuilding costs is €159 per sq ft for insurance.it just seems crazy considering mortgage only €155k and that's all you'll be covered for, not €420k. I'd be wary as to why its done like this and hope its not something for tax down the line based on valuation etc?

sydthebeat

what the mortgage is doesnt really come into it...

155k for a 2700 hse is only €57 per sq ft.
That is most certainly not realistic to demolish, extract and rebuilt to same finish.

what do you mean "thats all youd be covered for".. who told you this?
whos to say you havent pumped 100k of you own money into this house??

420k for a 2700 hse is €155 per sq ft.

while this may seem excessive, read the thread and see the kind of factors which are taken into account.

Shhh

Op I was in a similar situation last year, I renewed my insurance to cover 10% less than the valuation for rebuild in 2008, The bank wrote to tell me to raise the value insured, I rang to explain, same story they said no... I ignored them and after receiving about 3 more letters I eventually got one saying they updated their records with the new value... I suspect this time ignoring the problem may be a solution!

I'd be interested in hearing from the pros here what the risks are to doing that...(other than of course the risk of being underinsured...which I believe I'm not)

focus_mad

Duffers11 wrote: »

It's 2700 sq ft in Wicklow. I rang another valuer for a second opinion and they also said that for rebuilding costs is €159 per sq ft for insurance.it just seems crazy considering mortgage only €155k and that's all you'll be covered for, not €420k. I'd be wary as to why its done like this and hope its not something for tax down the line based on valuation etc?

Just after a quick calculation, 420k is probably a bit low in IMO.