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We now switch from the cost of insuring valuables in our ‘How much will it cost ___?’ series, to home renovation projects, in other words, how much will it cost to insure my renovation project?
In this article, we will only look at home renovation projects. Whilst we can cater for commercial renovation projects we don’t address these here (they’re a little too complex!).
The quality of the insurance product is more important than the cost
Careful consideration should be given to the quality of the insurance product above the premium, this is important for any insurance product you purchase but especially for renovation projects.
When a renovation project goes wrong, it can go terribly wrong. You can read about a Chelsea townhouse collapse on the BBC website here or click on the Guardian website here to read about a family left with a £250,000 bill because of not having their own insurance in place. It’s critically important you have the right cover in place for the renovation work! Our three costing examples are for the most comprehensive levels of cover to be found in the market, namely:
- All risks cover your existing buildings (your home)
- All risks to your contract works (the work itself)
- All free issue materials cover (the items you’re purchasing for the work, IE the kitchen not yet fitted)
- Property owners liability of £2mil included (any injury caused to a third party)
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The Magic Formula – Three Cost Examples
Looking at the tables below, we recommend you budget either £550, £1,000 or more than a £1,000 depending on the type of project. For the £550 and £1,000 products, the magic formula on whether your project will cost this much can be found in the description under the headings.
£550
Price includes 12% IPT and £50 fee.
Magic Formula to Qualify
- Buildings Sum Insured < £450,000
- Contract Value < £250,000
- Property Owners Liability £2mil
- Standard Construction
- Add £100 for Non Negligence Cover
- No Contents Included
- Using a Main Contractor
- JCT contract at no extra cost
- Not a listed property
£1,000
Price includes 12% IPT and £50 fee.
Magic Formula to Qualify
- Buildings Sum Insured < £450,000
- Contract Value < £250,000
- Property Owners Liability £2mil
- Standard Construction
- Non Negligence Cover Included
- No Contents Included
- Using a Main Contractor
- JCT contract at no extra cost
- Not a listed property
£1,000 +
Price includes 12% IPT and £50 fee.
Sadly, no Magic Formula
- This is the estimate cost for any renovation project that does not fit into the £550 or £1,000 product descriptions. This costing is for renovation projects:
- Listed Buildings
- Larger Sums Insured
- Increased Liability Covers
- Any Construction Type
- Any Project Value
- Any Contract Length
Factors taken into consideration for the costing
A renovation insurer will use the following to risk information to calculate the cost of the insurance:
- The buildings sum insured
- The contents sum insured (if applicable)
- The security in place at the property (CCTV, site hoarding, alarm)
- Whether or not the property is a listed property (IE Grade I or Grade II)
- If you’re in a rural or urban setting
- The construction of the walls and roof
- If you require additional liability cover or not (IE, project liability, employee liability etc)
- The value of the contract works
- Whether you’re using a main contractor in full control of the site or not
- How long will it take to complete the project
- The level of public liability cover required (£2mil, £5mil or £10mil)
- If there is a party wall
- The type of building contract you’re using (JCT Minor Works, Intermediate, RIBA etc)
Note, the above is not an exhaustive list but it gives you some idea of the major rating factors which contribute to the cost of the insurance. It’s important you have this, and other project related information, to hand when calling us for a quotation.
If you would like more information about costing, please call us on 01730 777600 or get a quote.