How Do BCIS Index-Linking Tables Work?
- Amy Lillington
- May 10, 2022
- 2 min read
Index-linking can be a complex area of building insurance, particularly when using BCIS tables to adjust a sum insured over time. I’m often asked how these tables should be applied correctly, especially by brokers who want to ensure they are illustrating rebuild cost movement accurately.
Here’s a clear explanation of how BCIS index-linking works in practice.
What Are BCIS Index-Linking Tables?
BCIS (Building Cost Information Service) tables track changes in construction costs over time. Insurers and brokers may refer to them when considering how rebuild costs have moved between renewal periods.
They provide percentage adjustments that reflect changes in building costs across a 12-month period.
However, it is important to remember that BCIS tables are not a substitute for a professional rebuild cost assessment. They are a guide to cost movement, not a method of calculating an accurate rebuild value.
How Should the BCIS Table Be Applied?
When using the BCIS tables for indexing a rebuild value, the correct approach is to apply the “on-year” percentage.
This means:
Take the figure for the month of renewal.
Use the percentage increase shown for the preceding 12 months.
Apply that percentage to the current sum insured.
You do not divide the annual movement across 12 individual monthly adjustments. Instead, you use the full on-year percentage relevant to the renewal month.
What If You Need to Apply More Than One Year of Indexation?
If index-linking needs to be applied over multiple years, the on-year percentage should be used at each renewal point.
Each year’s indexed figure is then added to the previous total. This ensures the adjustment reflects compounded cost movement over time.
Why This Matters
Construction costs can fluctuate significantly. If index-linking is misunderstood or applied incorrectly, the sum insured may fall behind true rebuild costs.
While BCIS tables help illustrate cost movement, they do not account for:
Individual property characteristics
Non-standard construction
Professional fees and demolition costs specific to a property
Regional variations
For this reason, a professional rebuild cost assessment remains the most reliable way to ensure a property is insured for the correct amount.
Watch Amy explain it all
Still unsure? Amy explains how we handle these cases and why it’s important to take a tailored approach when needed.
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