What is a reinstatement cost?
What the figure includes, how insurers use it and why accuracy matters.
What is a Reinstatement Cost Assessment?
How a professional assessment establishes an appropriate Declared Value.
The RCA lifecycle
Why and when to review your reinstatement value.
We offer two levels of professional reinstatement assessment, depending on the type and complexity of your property.
Desktop Valuation from £172.50 – Ideal for straightforward commercial properties
On-Site Valuation from £450 – Recommended for larger or more complex sites
Both include the key costs insurers expect: demolition, site clearance, rebuild costs, external works, and professional fees. VAT can be factored in where required.
We’ll help you choose the right approach — and ensure your insurance reflects the true cost of reinstatement.
Let’s say your building has a true rebuild cost of £1,000,000, but your policy’s Declared Value is £700,000. That’s 30% underinsured.
If you suffer a fire causing £200,000 worth of damage, the insurer may only pay £140,000 — leaving a shortfall of £60,000 that you’ll need to cover.
It’s a hidden risk that only becomes visible when it’s too late. But it’s easily avoided with a current valuation.
Your Declared Value is the estimated cost to rebuild your property at the start of the policy. The Sum Insured is this figure plus an uplift to account for inflation and market conditions during the policy term. Insurers use the Declared Value as the basis for calculating your premium.
Because insurance covers the cost to rebuild, not the price someone would pay to buy the property. Market value depends on location, demand, and use — none of which reflect demolition, construction, and professional fees required after a total loss.
We recommend a professional review at least every three years, or sooner if you’ve carried out works or costs have significantly changed. Construction prices have risen sharply in recent years, so even recent policies may already be out of date.
Insurers may apply the ‘average clause’, reducing your payout proportionally. For example, if you’re 30% underinsured, they may only pay 70% of any claim — even if it’s a partial loss. That could leave you thousands out of pocket.
For many buildings, a desk-based valuation is accurate and cost-effective. However, complex sites or mixed-use properties may benefit from a site visit for greater precision. We’ll help you choose the best option.
Yes. We only arrange reinstatement cost assessments through professional valuation firms regulated by RICS. The resulting independent assessment provides insurers with a robust basis for establishing an appropriate Declared Value and can help reduce the risk of underinsurance and the application of average.
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Brownhill Insurance Group Limited is authorised and regulated by the Financial Conduct Authority, registration Number 306131.
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Send us your name, email and telephone number and we will call you back. For immediate service, contact a member of the Commercial Insurance Team on 020 8658 4334.
Send us your name, email and telephone number and we will call you back. For immediate service, contact a member of the Private Client Team on 020 8658 4334.