Home Insurance

N

Nanor

Registered User
Messages
21
Hi,

I am in the process of buying a 3-bed semi. My BOI mortgage adviser informed me that I needed to wait until the valuer responded with his report before I could apply for home insurance.

Now the valuer has responded saying I need €260 rebuild cover and i'm paying €280 for the house.

Is this normal? It seems like a lot for a rebuild but am I required to go with the value he says?

thanks.
 
Normally the valuer specifies the rebuild insurance so you will probably have to go with this. If house was destroyed you wouldn't have to buy the site but you would have site clearance costs so it isn't always an awful lot cheaper than purchase price. When it's a semi there is risk of damage to the attached house too in the case of fire for example.
 
Check out the Chartered Surveyeor rebuild cost guide.

http://www.scsi.ie/

The price you are paying is irrelevant. The rebuild cost is the estimated cost of
rebuilding the house in the case of complete destruction in a fire, including
site clearance, architect fees, all contents and fixing damage to the attached house.

If you believe that 260K is not correct, based on the scsi figures, you could ask for a breakdown of what the valuer based this figure on.
 
you could just over insure if you are that worried but the price you are paying is irrelevant.

We are taking out a mortgage at the moment and our rebuild valuation is 5k above the price we are paying
 
well i suppose you could be buying something at a very low price...

but 260K to rebuild a 3-bed semi (1100 sq yard) seems like a lot to me to be honest.
 
But one must remember the thing called the average clause in Insurance. This means that if a property is insured for half the correct value and the property is destroyed by fire, the Insurance only pays out half the value. So therefore work out how much the rebuilding costs might be, and add an extra amount for finishes such as kitchen, bathrooms and built in furniture.
 
Also there are examples where the building cost exceeds the purchase cost of a property. i.e. you could not build a house for the price they are selling at. Even ignoring the value o the site.
 
But for Insurance purposes and finance purposes it's the rebuilding costs that are important. Incidentals do not matter in Insurance -- that's the whole purpose of it.
 
DingDing said:
Also there are examples where the building cost exceeds the purchase cost of a property. i.e. you could not build a house for the price they are selling at. Even ignoring the value o the site.
Click to expand...

Yes,
you should be insured for the amount that it would cost to reinstate your house to its current condition in the event of a fire.

Whether you bought the house at 2007 prices or 2012 prices is irrelevant.
 
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