Building Reinstatement Cost Assessments (RCAs) are a critical safeguard against underinsurance but despite efforts from RICS-regulated suppliers like Cardinus, and industry professionals including freeholders, managing agents, insurers, and brokers, underinsurance remains alarmingly widespread.

Our 2024 data reveals:

• 73% of RCAs referred by insurance partners were underinsured.
• Over 40% of those were underinsured by more than 60%.
• The most severe case showed a shortfall of £22 million on a single building.

These figures are more than concerning—they’re financially devastating. In the event of a claim, insurers will only pay up to the sum insured, leaving clients to cover the shortfall. That’s a risk no one wants to take.

Keep reading to discover the causes, real-world impacts and how Cardinus can help you avoid costly shortfalls with a Reinstatement Cost Assessment (RCA) for your property.

These figures are more than concerning—they’re financially devastating. In the event of a claim, insurers will only pay up to the sum insured, leaving clients to cover the shortfall. That’s a risk no one wants to take.

Common causes of underinsurance

• No professional valuation in the last three years
• Confusion between market value and reinstatement cost
• Outdated figures that ignore rising material and labour costs
• Overreliance on developer estimates, especially for new builds

The real-world impact

• Insufficient funds to complete a rebuild
• Increased borrowing and financial strain
• Balance sheet damage
• Complex negotiations with insurers
• Frustrated leaseholders and tenants
• Delays in reconstruction
• Legal exposure from lenders and leaseholders
• Reputational harm

No party walks away from an underinsurance claim unscathed.

RCA: On-site vs Desktop—What’s right for you?

While desktop RCAs offer a cost-effective alternative, they’re not always suitable. An on-site RCA includes:

• Full site walk-through
• Detailed measurements (per RICS standards)
• Sketch plans and digital imagery
• Documentation of peripheral features
• Comprehensive reporting

Desktop RCAs use satellite imagery and rebuilding rates—but beware of potential pitfalls

Desktop RCA may be appropriate if:

• Satellite imagery is current
• No property changes in the last three years
• Standard construction with clearly defined footprint
• No underground features
• Mixed-use buildings needing only one overall valuation

Desktop RCA may be risky for:

• Listed or historically significant properties
• Unusual shapes or construction methods
• Properties with basements or underground parking
• Mixed-use buildings with unclear boundaries
• Industrial units with hidden mezzanines or fixtures
• Waterfront properties with moorings or jetties

Also consider: Will your supplier back the desktop RCA with full Professional Indemnity cover, or will caveats leave you exposed?

Be proactive, not reactive

Underinsurance is a silent threat—but one that’s entirely preventable. Regular RCAs from Cardinus, a professional RICS-regulated provider, are your best defence. Whether on-site or desktop, make sure your assessment is fit for purpose and fully backed.

Better safe than sorry—book your RCA with Cardinus today.