The rebuild cost will usually be lower than the market value, as the rebuild cost simply takes into account the cost of labour and materials and does not consider factors such as supply and demand.
If you underestimate the rebuild value and your home is completely destroyed then your insurance may not cover the full costs.
It’s therefore recommended that you use a professional surveyor, who can calculate the rebuild cost for you.
Engaging a professional surveyor is better than trying to calculate the cost yourself, but you should certainly not try and do a DIY calculation if you live in a flat or maisonette, or in a house of non-standard construction, such as one with a thatched roof or one that isn’t made of brick.
If you make changes to your home – an extension, loft conversion, conservatory etc then the rebuild cost of your home is likely to increase, and in these circumstances you should have the rebuild cost re-assessed, and inform your insurance provider of the outcome.
If you over-insure your property, then you’ll be wasting money by paying a higher premium. There’s no benefit to over-insuring as the insurance provider will only ever cover the rebuild cost if your home is destroyed, they won’t pay out the extra amount.
You can use the default figure on our site to get an idea of how much this should cost. This could save time and money on using a surveyor. You can also find insurance that offers ‘blanket’ cover where the insurer offer a set amount (£500k, £1m and sometimes unlimited) which should cover the rebuild cost of your home.