CoverMapWhy underinsurance happens
Rebuild costs and replacement values tend to drift upward with inflation and construction cost increases, but many homeowners never revisit their sum insured after first setting up a policy. Over several years, a figure that was once accurate can fall well behind real rebuild costs — sometimes by tens of thousands of pounds.
Buildings: rebuild cost, not market value
Your buildings sum insured should reflect what it would cost to demolish and rebuild your home from scratch, including materials, labour and professional fees — not what the property would sell for. These two figures can differ substantially, especially in areas with high land values but average construction costs.
Contents: genuine replacement cost
Add up what it would actually cost to replace every item in your home at today's prices, not what you originally paid or what the items are worth secondhand. It's easy to underestimate this, particularly for accumulated items like clothing, kitchenware and electronics.
How to check and fix it
- Use an online rebuild cost calculator (often provided free by insurers) rather than guessing or using the property's market value.
- Do a rough room-by-room contents inventory at replacement value, updating it every couple of years or after a major purchase.
- Review your sum insured at every renewal, not just when you first take out the policy.
- Flag any high-value single items (jewellery, electronics, art) that may need separate specified cover above the standard single-item limit.