The importance of getting an asset valued for your insurance
9th January 2015
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In recent years many UK businesses have fallen victim to the financial crisis and have been forced into administration and receivership. Who can forget the headlines about high street giants such as Habitat, HMV and Comet being driven into liquidation?   In many cases it’s due to a decline in sales with an increase in operational costs. However, research has proven that one of the most reoccurring and potentially detrimental factors to threaten UK businesses is the excessive and growing amount of under-insurance cases on buildings and contents. Insurance is a vital form of protection for any business.

This is particularly relevant in Bath, the only city in the UK to be awarded UNESCO World heritage site status. With over 650 Grade I listed buildings it has one of the highest concentration of listed buildings in the country. These beautiful Georgian buildings define our city’s landscape and are often accompanied by numerous building conservation regulations which need to be considered when obtaining an insurance valuation.  

For businesses housed in a listed building there are additional considerations that need to be addressed. The insurance will need to cover the reinstatement of the building to its listed status, both externally and internally; the latter of which is not always understood. To reinstate a building to its listed status requires specialist building materials, such as Bath stone, a specialist architect, a specialist surveyor and skilled craftspeople among other things. An additional consideration is the location of a property; in Bath there are many small streets with limited access, making repair or a re-build of the property that much more difficult. These factors all add to the cost of reinstating the building and demonstrate why it is paramount to have an accurate valuation of the building.

To help reduce the risk of under-insuring your business and your assets, a proper valuation of an asset should conducted, which will provide you with the correct sum to be insured. Employing a professional valuation company is recommended as they will select the most effective methodology for your business and means that all accountability is held by a third party. This provides a peace of mind for everyone involved in the financial elements of the business and ensures that the business asset values are accurate.

As the values of your assets can change over time we would recommend having an onsite valuation every three to five years to make sure that your insurance policy is up to date. In addition we have created the following checklist which you should go through on a regular basis to make sure that there are no gaps in your policy:

  • Know where your current declared values originated
  • Make sure you have an asset register
  • Know when your last professional insurance valuation was
  • Make sure you understand the ‘average’ clause is your insurance policy and how it could affect your business
  • Check your policy to make sure that you are not over insured and paying too high a premium
  • Make sure that you could substantiate your declared values in the event of a claim

If you follow these steps then it should help to protect your business from failing should there be a need to claim on your insurance.  For more advice and information then speak to an insurance specialist.

By Ian Sandham, Branch Director Bluefin

 

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Bluefin

Member since: 23rd September 2013

The dedicated team at Bluefin Bath provides specialist independent advice on business insurance, home & motor insurance, wealth management and financial planning.

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