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Underinsurance is a critical issue

Published

2 years ago

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By John Healy of Healy Insurances

Home owners may have received a letter recently from their insurer regarding 'underinsurance'.

The Central Bank of Ireland has instructed insurers to contact all home owners to highlight this critical issue.

As an insurance broker we have been highlighting this matter for a number of years to our customers as the cost of building has been increasing steadily since before the pandemic.

Last year Zurich Insurance carried out a survey of over 1,000 Irish consumers.

Its key findings were as follows:

According to the research, 51% of homeowners surveyed are correctly insuring their properties, while over 1/3 of homeowners (36%) are incorrectly insuring their properties by basing their calculation on their homes’ market value as opposed to its rebuild cost. An insurance valuation refers to the ‘building sums insured’, which is the full cost of rebuilding a property including the cost of site clearance and architects’ fees. This should not be confused with the market value.

A further 36% of people who took out a home insurance policy did not take any action to calculate their buildings sums insured, i.e., the rebuild cost of their home. However, one in four people used the rebuild cost calculator operated by the Society of Chartered Surveyors Ireland (SCSI) or another reputable operator, while 15% of homeowners organised a bespoke rebuild valuation through a building’s surveyor.

Meanwhile, over a quarter (26%) of homeowners have reviewed the cost involved in rebuilding their home within the last year, 20% reviewed two years ago while a similar figure (19%) have left it three years or more. Almost 1/5 of homeowners (18%) have never reviewed the cost to rebuild their home or can’t remember doing so. High and rising inflationary costs across the construction sector mean homeowners should be reviewing their rebuild cost annually when renewing their policy to avoid the possibility of homes being underinsured.

I would recommend that you review your reinstatement sum insured sooner rather than later and continue to review during the year. In order to get a definitive individual reinstatement value on your house you should contact an independent qualified surveyor.

The most recent rebuilding cost report and a rebuilding calculator can be found at www.scsi.ie.

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‘Spring into Your Best Life’ event

The Oaks Hotel in Killarney will host ‘Spring into Your Best Life’ on April 5, an event organised in association with Breast Cancer Ireland and Irish Country Magazine. The event, […]

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5 hours ago

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24 March 2025

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The Oaks Hotel in Killarney will host ‘Spring into Your Best Life’ on April 5, an event organised in association with Breast Cancer Ireland and Irish Country Magazine.

The event, running from 12:30pm to 5:30pm, aims to provide attendees with advice on beauty, wellness, fashion, health, and happiness.
Hosted by Maura Derrane and James Patrice, the event will feature speakers including fashion expert Celia Holman Lee, pharmacist Laura Dowling, wellness expert Oonagh O’Hagan, and fitness coach Orla Hopkins.
Dr. Brian Cotter from Sisu will discuss aesthetics, while Christina Foley will focus on holistic wellbeing. Life coach Ariana Dunne will also speak on personal and professional success.
The event will include a drinks reception, a gourmet lunch, beauty and fashion masterclasses, and shopping opportunities. Attendees can win prizes throughout the day. A special Mother’s Day draw will take place for those attending with their mothers or daughters.
Tickets are available for the event via: https://www.eventbrite.ie/e/your-best-life-kerry-fun-style-wellness-giveaways-breast-cancer-ireland-tickets-1021537374787?aff=oddtdtcreator

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KCC Students Receive Social Enterprise Award

Killarney Community College students Cian Walsh, Sophie Ballard, and Ella Whiteley received the Runners Up award for Social Enterprise at the Kerry County Council Annual Student Enterprise Awards. Their business, […]

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6 hours ago

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24 March 2025

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Killarney Community College students Cian Walsh, Sophie Ballard, and Ella Whiteley received the Runners Up award for Social Enterprise at the Kerry County Council Annual Student Enterprise Awards.

Their business, ‘Moods & Moments’, was recognised at the county final held at Munster Technology North Campus on Friday last (March 14).
The event saw 20 mini businesses created by secondary school students, focusing on business development, finance, marketing, and business plan presentation. Students operated their mini companies over several months, experiencing real-world entrepreneurship.
Prizes were awarded across Junior, Intermediate, and Senior levels.
Tomás Hayes, Head of Local Enterprise Office said: “I am pleased to see the level of innovation, resourcefulness, planning and development of all 20 projects in this year’s awards. This is a real-life exercise. It involves idea generation and actual trading. Profits are generated and finance is secured. It is a taste of business and all the issues involved from finding the right idea, funding the business, collecting the money, and building the team. I must commend the teachers for their efforts and the mentors for their support. The judges had a very difficult task.”

Photo: Michelle Breen Crean Photography

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