Homeowners overspending on buildings insurance

3rd October, 2005

Homeowners who are confused about the worth of their house in relation to buildings insurance could be overspending by as much as £600 per year.

Most Brits reportedly assume that the cost of rebuilding a property and the market value of a home are the same figure.

However, insuresupermarket.com says that the two values are usually different.

It explains that while property values may have soared in recent years, the cost of building materials has not matched this rise, so the price of a re-build should be substantially less than the market value.

This common mistake can cost up to £600 per annum, so over the course of a lifetime this adds up to an incredible amount of money.

'Just because the market value of your property has soared through the roof in recent years doesn’t mean your buildings insurance cover need do the same,' said Richard Mason, director of insuresupermarket.com.

'Unless you've just bought your property, and read through your surveyor's report carefully, many homeowners have no idea of the rebuild cost of their home. It’s an easy mistake to assume the rebuild cost and market value will be the same, but as our example shows, this could cost you more than £600 in unnecessary buildings insurance premiums - and that’s just over the course of one year,' he added.

 

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