Insurance Valuations in Sydney: Know Your Replacement Cost
Monita provides insurance valuations that set the replacement and reinstatement cost of buildings, plant and contents so your sum insured is right.
What an Insurance Valuation Includes
A reinstatement or replacement cost assessment of buildings, plant, contents and fit-out, prepared so the sum insured on your policy reflects what a claim would really cost. It records what it would cost to rebuild or replace the asset, not what it would sell for.
Who Needs One?
Insurers, brokers, asset-owning businesses and individuals.
- Buildings & structures
- Plant, Machinery & Equipment
- Specialised industry assets
- Contents and fit-out
- Infrastructure
Insurance Valuations in Sydney
Monita prepares insurance valuations for buildings, plant and fit-out in Sydney and NSW, from our office at 1/261 George Street, Sydney NSW 2000. Strata and commercial building owners, brokers and businesses with substantial plant can have buildings and plant assessed together.
Reports are prepared under Nirav Shah, Chartered Valuation Surveyor (MRICS) and Certified Practising Valuer (Property and Plant & Machinery). Group heritage since 1954. Your insurer and policy terms decide how a claim is paid, so share your policy details when you enquire.
Replacement Cost vs Market Value
Market value is the price an asset would sell for. Replacement or reinstatement cost is the cost of rebuilding or replacing it with something equivalent, including demolition, professional fees and site works where relevant. A property can have a market value well above or below its rebuild cost, which is why an insurance valuation is a separate assessment.
Land is generally left out of an insurance valuation, because land is not lost in an insured event. Contents and business stock are also outside a building valuation, though fit-out and plant can be assessed separately.
What an Insurance Valuation Report Contains
The report lists the buildings, plant and contents covered, the basis used and the replacement or reinstatement cost of each item or group of items. It allows for demolition, professional fees and site works where relevant, so your broker or insurer can set the sum insured from a clear figure instead of a guess.
It also states its assumptions, for example that a rebuild would have to meet current building codes, which can cost more than the original construction.
When to Review Your Sum Insured
Costs and assets change over time, so it is worth reviewing the sum insured when:
- You renovate, extend or upgrade a building or fit-out
- Building, equipment or labour costs have risen
- You buy or acquire new plant and equipment
- Your insurer or broker asks for an updated valuation
- You have never had a valuation, or the last one is several years old
Strata, Commercial and Older Buildings
Strata buildings, commercial premises and older or character buildings each raise their own questions. In a strata scheme the insured building usually covers common property, so the owners corporation, strata manager or broker will want a clear, supportable figure. Your strata manager or solicitor can confirm what applies to your scheme.
Older buildings can cost more to rebuild because of materials, detailing, specialist trades and sometimes heritage controls. Send us the address and any heritage listing details and the report will state the assumptions used. Your insurer decides what is covered.
What Affects the Cost of an Insurance Valuation
The fee depends on the number and type of assets, the size of the buildings, whether an inspection is needed and how detailed the schedule must be. We give a firm fee estimate after the free consultation, before any work begins.
How a Monita Valuation Works
Free consultation
We talk through the purpose, the valuation date and what the report is for.
Scope and fee
You get a firm fee estimate and a delivery date before any work begins.
Valuation
We gather the evidence, inspect where needed and apply the method that suits the purpose.
Report
A clear report setting out the basis, the evidence and the reasoning, ready for your adviser, lender or auditor.
Insurance Valuation FAQs
What is an insurance valuation?
An insurance valuation estimates the cost to rebuild or replace an asset, so your sum insured reflects the real cost of a claim. It is prepared for insurance purposes, which is different from a valuation prepared to support a sale, a loan or a tax position.
Is an insurance valuation the same as a market valuation?
No. A market valuation estimates the sale price, while an insurance valuation estimates replacement or reinstatement cost. The two figures can be very different, because market value includes land and market conditions while rebuild cost reflects materials, labour and building requirements.
What assets can be valued for insurance?
Buildings and structures, plant, machinery and equipment, contents and fit-out, and specialised industry assets. Tell us what your policy covers and we will confirm the scope, including whether buildings and plant are best assessed in one engagement.
Do you provide insurance valuations in Sydney?
Yes. Monita is based in Sydney and provides insurance valuations for buildings, plant and contents in Sydney and NSW. We confirm at the free consultation whether an inspection is needed and what information we require from you.
How often should I update my insurance valuation?
It is sensible to review it when you renovate, buy new plant or equipment, or when building and equipment costs rise. Your insurer or broker can tell you how often they expect an updated figure, and we can prepare it to suit.
What is the risk of being underinsured?
If the sum insured is lower than the real cost to rebuild or replace, a claim may not cover the full loss, and the owner may carry the shortfall. An insurance valuation helps set the sum insured at a supportable figure. Your insurer and policy terms decide how a claim is paid.
Is land included in an insurance valuation?
Generally no. An insurance valuation covers the cost of rebuilding or replacing buildings and structures, because the land is not lost in an insured event. That is one reason the figure can differ greatly from a market valuation, which values land and buildings together.
Does an insurance valuation allow for current building standards?
Generally yes. A rebuild after a major loss would usually have to meet current building codes and regulations, which can add to the cost. The report states the assumptions used and allows for demolition and professional fees where relevant.
How often should a strata building be valued for insurance?
Strata schemes should review the insured value of the building regularly, and many get an updated valuation on a set cycle or when costs move. Your strata manager, broker or solicitor can confirm what applies to your scheme, and we can then prepare the report.
Are contents and business stock included?
A building valuation does not include contents or business stock. Fit-out, plant and equipment can be assessed separately, and we can include them in the same engagement where relevant. Tell us what you want covered and what your policy requires.
Can plant and machinery be valued for insurance in the same report?
Yes. Plant and equipment can be assessed for replacement cost alongside buildings, which helps businesses insure both on a consistent basis. Plant is assessed under a Certified Practising Valuer (Plant & Machinery). Send us an asset list and we will confirm the scope.
Do I need an inspection for an insurance valuation?
It depends on the building and the purpose. An inspection helps record construction, condition, finishes and fit-out. For a simple update of a recent valuation, a different approach may be possible. We confirm the approach at the free consultation after hearing what you need.
Ready for a precise, independent valuation?
Connect with the Monita Asset Management team. All consultations are free of charge.
- Free initial consultation
- Fee confirmed before any work begins
- Certified Practising Valuer, Sydney CBD office