Why is reinstatement cost different from market value?

Reinstatement cost is the cost to rebuild the building to the same specification including professional fees, demolition, and site clearance. Market value includes land value and location premium. For insurance, reinstatement cost is the correct basis; market value may underinsure or overinsure.

What is average in property insurance?

The average (or co-insurance) clause proportionally reduces claim payments if the sum insured is below reinstatement cost. If sum insured is 80% of reinstatement cost, the insurer pays only 80% of each claim. Annual reinstatement cost reviews prevent underinsurance.

Reinstatement Cost Index × Rebuild Rate Calculator

Calculate property reinstatement (rebuild) cost for insurance sum insured purposes: floor area (m²) × RICS/BCIS rebuild rate (per m²) + professional fees (10–15%) + debris removal + planning costs.

Statute of Limitations

Incident / Event Date

Claim Type

⚖ For informational purposes only. Not legal advice. Consult a licensed attorney for your specific situation.

How to Use

Enter the values for the scenario you are assessing. Calculate property reinstatement (rebuild) cost for insurance sum insured purposes: floor area (m²) × RICS/BCIS rebuild rate (per m²) + professional fees (10–15%) + debris removal + planning costs. Use the reinstatement cost result to inform your calculation.

Reinstatement Cost Index × Rebuild Rate Calculator

Statute of Limitations

How to Use

Frequently Asked Questions

Why is reinstatement cost different from market value?

What is average in property insurance?