Insurance Replacement Valuation Report

Why An Accurate Insurance Replacement Valuation Matters

The Australian Institute of Quantity Surveyors (AIQS) advises all residential, commercial, strata-titled, and industrial properties have regular insurance replacement valuations for insurance purposes.

Even if a physical inspection is not possible, AIQS recommends a desktop assessment to ensure the property is properly covered. An accurate valuation process is crucial to determining fair sums insured and avoiding potential financial pitfalls. Valuations should include both the hard and soft costs of reconstruction, such as professional fees and cost escalations.

Not getting an up-to-date valuation can result in:

• Underinsurance: If the sum insured is too low, the owner will be out of pocket for any shortfall in repair/replacement costs.
• Overinsurance: If the sum insured is too high, the owner pays too much premium.
• Breach of co-insurance clause: Most commercial policies have a co-insurance clause that allows insurers to reduce payouts if the property is underinsured.

How Often Should You Get a Valuation?

The cost of rebuilding a property can change significantly over time due to inflation, updated building codes, and market changes. With that in mind, the Australian Institute of Quantity Surveyors recommends an updated Insurance Replacement Valuation every 3-5 years.

Regular replacement cost assessment is crucial to determine the insurance coverage needed for the complete demolition and reinstatement of a building in the event of irreparable damage.

Also, get a new valuation if you renovate or extend your property, as this will change the replacement cost. Having an up-to-date valuation ensures your cover matches the value of your asset.

Quantity Surveyors to the Rescue

Property owners can turn to our quantity surveyors to combat underinsurance. We have qualified professionals who can provide accurate insurance replacement valuations for commercial and residential properties.

Obtaining an accurate replacement cost estimate is crucial to ensure that the insured value aligns closely with the replacement cost, mitigating the financial impact of natural disasters.

A complete insurance valuation from a quantity surveyor will take into account the following:

• Current construction costs
• Demolition and debris removal
• Professional fees (architects, engineers, etc.)
• Cost escalations over the insured period
• Compliance with updated building codes

By getting in touch with Duo QS, owners can be sure they’re not overinsured (and paying too much premium) or underinsured (and exposed to losses). Valuations should be updated every 3-5 years to account for changes in construction costs and regulations.

Don’t Wait for a Problem to Occur

Property owners can’t afford to be complacent about insurance, with construction costs rising and natural disasters always lurking. Underinsurance is a significant and costly problem you can avoid with regular professional valuations, including an insurance valuation report.

Property valuers are crucial in providing accurate insurance valuations for residential and commercial properties.

Quantity surveyors are the experts in insurance replacement cost assessments. Getting a professional to do it and updating valuations every few years can ensure you have the right cover for your situation.

Don’t wait – talk to our quantity surveyors today in Duo QS about getting an insurance valuation for your property. With the right cover, you can sleep better at night, knowing you’re prepared for whatever comes next.

Why Choose Us Over Others?

We have a proven track record of representing clients as experts in property damage claims. When insurers underpay, we make sure homeowners receive payouts that fully cover rebuilding costs.

Under instruction from your legal representative, Duo QS can assist with this professional assessment of the true cost of replacing your building that may no longer be fit for use. 

As affiliate members of the AIQS, we can also respond to many of your needs or concerns regarding insurance enquiries. 

Give us a call at 1300 347 672, and we can provide you with expert guidance.

FAQs

What is underinsurance?

Underinsurance is when a property owner doesn’t have enough insurance to cover the full cost of repairing or replacing their property and assets if they are damaged or lost.

How common is underinsurance in Australia?

It’s estimated that across multiple property sectors, Aussie assets are–on average–24% underinsured to some degree. This is a major problem with serious financial consequences, with many just one insurance event away from shelling out hundreds of thousands of dollars for repairs.

Who can provide insurance replacement valuations?

Quantity surveyors are the acknowledged experts in construction costs and insurance replacement valuations for all types of properties.

Affiliation with the Australian Property Institute (API) ensures that property valuers adhere to high qualifications and ethical standards, providing high-quality service and reliable insurance valuation reports.

What does an insurance valuation include?

A full valuation will include current construction costs, demolition and debris removal, professional fees, cost escalations over the insured period, and any updates to comply with building codes. Insurance valuation reports are essential for estimating these replacement costs accurately, especially for properties in remote areas.

Replacement construction costs are also a critical factor in insurance valuation. It considers reconstruction times, demolition costs, and allowances for cost escalation to ensure comprehensive coverage.