Most brokers believe that UK buildings sums insured are inaccurate, with the majority estimating that commercial and high-net-worth household properties are either “severely” or “very” underinsured.
Online rebuild cost assessment service Insuranceshortfall.com questioned 100 brokers at this year's 2017 BIBA Conference and Exhibition, which took place in Manchester earlier this month.
Almost three quarters of brokers (72%) said they believed that most commercial properties were either “very” or “severely” underinsured, at between 60% to 80% (or less) of their correct value. More than half (55%) estimated that high-net-worth properties were either “very” or “severely” underinsured. Overall, only 16% of brokers said they thought buildings were normally covered for the right amount, while 13% said they believed properties were over-insured.
“Most brokers’ estimates of overall levels of underinsurance appear to be reasonably accurate,” said Trevor Smith, Director of Rebuild Cost Assessment Ltd, the ‘regulated by RICS’ company behind Insuranceshortfall.com. “We recently reviewed just over £1 billion worth of household and commercial buildings and found that overall they were insured for just 63% of the correct amount to rebuild.”
Trevor added: “Of course, what is worrying about this situation is that it means too many policyholders are facing potential claims disputes arising from under-insurance.”
Insuranceshortfall.com offers a unique online service to both policyholders and brokers designed to significantly reduce, where possible, the cost of obtaining an independent professional assessment of rebuild cost on properties. Its InsurTech ‘Broker Zone’ online platform also makes it far quicker and easier for brokers to arrange rebuild cost assessments on behalf of their clients.
Peter Robinson, Managing Director of brokers Prizm Solutions, commented: “The simple fact is, we as brokers just do not know when it comes to sums insured on buildings. The only real answer is to use a scientific method of calculation through a professional organisation. Only then can we provide the right answer to our clients and get them insured correctly.”
Peter added: “I really am very impressed with the service we receive from Insuranceshortfall.com. It’s a superb facility which helps us to address the massive problem of underinsurance among householders and SMEs.”
For more information visit www.insuranceshortfall.com/brokers