A new report by The Society of Chartered Surveyors (SCSI) highlights that some homeowners are overpaying for their house insurance.

The overpayments may be because they are paying for more cover than they can claim in the event that they need to rebuild their home.

The SCSI are warning that some homeowners are confusing market value with rebuilding costs and overpaying for insurance cover they will not need, while some may not have enough cover.

Rowena Quinn, Chair of the SCSI Communications Committee and Managing Partner of Hunters Estate Agents, said that she has spoken with clients who were carrying 50% more home insurance cover than they could ever claim and overpaying on their insurance premium as a result.  

Ms. Quinn said that the most common mistake that homeowners made was to confuse the market value of a property with its rebuild cost.

The Society has today launched the latest edition of its annual Guide to House Rebuilding Costs. 

The guide highlights that the average 3 Bed semi-detached (1,023 sq.ft) house in Donegal is €85,000, but the rebuilding cost based on the SCSI House Rebuilding Guide is €117,000. 

In contrast, a similar property in Dublin could sell for €350,000, but has a rebuild cost of €181,000.

Kevin Brady, Chair of the SCSI Construction Cost and Indices Committee said “Increases seen in Dublin and Cork are directly linked to the increase in construction activity seen year on year in Dublin and recently in Cork. However regionally, outside of these areas, rebuilding costs have remained static.”

“Having the correct reinstatement value will not only make certain that you are not over or under insuring your property but will also avoid over-payment when it comes to your home insurance premium.  The guide covers the rebuilding of estate type houses with standard finishes.” He added.

Source: www.businessworld.ie