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19 JUN 2018

BCIS data and reinstatement cost assessment

BCIS data and services can be used to assist surveyors in carrying out reinstatement cost assessments (RCA) for insurance purposes.

This is highlighted in the new edition of the RICS guidance note, Reinstatement Cost Assessment of Buildings.

For commercial (ie. non-housing) buildings, BCIS Online provides:

  • average prices for buildings and elements
  • elemental analyses
  • schedules of rates
  • indices
  • forecasts
  • location and other adjustment factors and
  • a construction duration calculator.

This will provide most of the basic cost information required to carry out an RCA. It will of course require the expertise of the surveyor to interpret the circumstances of a specific property.

The recently introduced RICS Commercial Reinstatement Tool uses BCIS data, along with allowances for external works, demolition and professional fees, to provide an estimate of the likely reinstatement cost. The BCIS data covers all building types.

Insurance is normally split between housing and commercial, which covers everything else, including in some circumstances, flats.

Surveyors need to establish the base date for the assessment and adjust their estimate accordingly. The BCIS forecasts will be helpful in establishing if an allowance for inflation is required.

Elemental adjustments

Where BCIS average prices or elemental analyses have been used as the basis for the estimate these need to be adjusted for the specification of the property and that is best done elementally, as shown in Appendix A of the guidance note.

Approximate quantities may also be used to assist in the appropriate allocation of costs in the elemental breakdown and the BCIS Schedules of rates will supply estimating data to assist in pricing.

The guidance note requires that measurements are sufficient to calculate the IPMS 2/GIFA for each different type of construction and these should be in accordance with the current edition of the RICS professional statement RICS property measurement. It is important that measurement is on the same basis as the costs; BCIS data is based on GIFA, which can be derived from IPMS2

With few exceptions, the final assessment figure will normally comprise the net rebuilding cost, which includes:

  • total cost of completely rebuilding the property to be insured in its present design and materials, to its existing shape and size
  • any tenants’ alterations for which the landlord has a responsibility to insure
  • allowance for modifications to the design and specification required to comply with current building regulations and statutory requirements
  • cost of external works and services.

Allowance also needs to be made for other matters, including:

  • demolition and debris removal
  • professional and statutory fees
  • public authorities’ stipulations.

For assessments of individual houses and flats the BCIS Rebuild Online service provides a detailed calculation tool.