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Self build insurance what you need to know

Insurance can feel like one of the least interesting things to think about when building your dream home – so tedious it can't even qualify as a nightmare. But in fact, if a real-life nightmare puts your whole project in jeopardy, proper insurance can turn out to be the thing that keeps your dream alive.

Unless you have put the whole project in the hands of a contractor who you are sure has all the necessary cover, you'll need to take out self-build insurance during the work in case anything goes wrong. This shouldn't be for the cost of the project, but for its professional reinstatement cost – the amount of money you would need to pay a contractor to take over the whole project and redo it from scratch.

This isn't the same as the cost of building it, or its market value once it's completed, for several reasons:

Building your own home is usually cheaper than getting a contractor to do it, especially if you've done a lot of the work yourself. It's one of the main attractions of self-build projects. But if the whole thing burns down at an advanced stage – obviously unlikely, but fires do happen – you may not have the time, patience or emotional resources to do the whole thing again yourself.

If you're converting a building, suddenly finding yourself with a full rebuild on your hands is bound to be more expensive than the conversion would have been, since the conversion typically involves keeping much of the original building.

How much are professional rebuilding costs?

As a guide, professional rebuilding costs can be up to 30 per cent more than original self-build costs. They need to cover professional labour and materials, site clearance, debris removal and professional fees.

You can use the Royal Institute of Chartered Surveyors’ (RICS) calculator for an estimate. You’ll need to know your home’s external floor area for all floors – that's the floor area including the walls – and it will give you the rebuild cost per square metre. It doesn't cover houses not made of brick, or listed buildings.

If you're doing a conversion, you should get a surveyor to estimate the rebuild costs. This should cost about £250, and you can find a surveyor through RICS.

It's also wise to reassess your professional rebuilding cost regularly during the building process, as self-build projects have been known to run over budget, as any regular Grand Designs viewer will know.

Architectural Services with Bluelime Home Design

We've been designing houses – new builds, self-builds, extensions, conversions – for twelve years and are well established as self-build architects across south east London and north Kent, with offices in Dartford, Erith, Bexley, Bromley and Croydon. If you'd like to talk to us about any aspect of self-building, we're happy to help – just call us on 01322 521026 for an informal chat or email fresh@bluelimeprojects.com.

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