One of our Directors, Andrew Slevin, was recently interviewed at BIBA on the topic ‘Which areas of risk are most commonly ‘under insured’ and what can be done to address this?’  by Insurance Business.
Link to watch the full interview here: https://www.insurancebusinessmag.com/uk/tv/which-areas-of-risk-are-most-commonly-underinsured-455637.aspx

Charterfields is celebrating its ‘Pearl Anniversary’ this year. We’d like to express our gratitude to everyone who has supported us since 1992, including our amazing past and present team, valued clients, suppliers and contacts. 

From humble beginnings as a small partnership formed in Sheffield in 1992, Charterfields has grown to become a recognised global name in the specialist field of Chartered Surveying, focusing on the needs of the UK and international insurance markets, covering valuations and assessments of property, plant, and equipment.  A proud member company of the RICS, the business remains independent, providing impartial advice and working to the exacting standards set by the institution.  

Neil Warburton, the last remaining founder member of the original 1992 partnership group, said: “I am delighted to see how the business had changed and flourished over the years and I have a real sense of pleasure in being part of the new leadership team, led by Andrew Slevin who joined the board of Directors earlier this year, to take the business forward.” 

Andrew Slevin added: “Moving forward, Charterfields will continue to develop and deliver pioneering, dependable asset valuation solutions for risk managers as well as for insurers and a wide range of professional intermediaries, including brokers. We look forward to working with our valued clients for the next 30 years.” 

In celebration of this milestone, Charterfields will be posting highlights from our journey over the last 30 years. 

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Key highlights

• Clients relying on independent assessment to set their declared values need to have confidence that, in the event of a loss, these assessed figures are accurate, defendable and can stand up to insurance market scrutiny​
• While property valuers and quantity surveyors have a role to play in fixed asset management and new construction costing, their limited knowledge of insurance policy terms and how insurers view property risks, could leave owners exposed​
• Insurers now expect higher standards from policy holders in terms of information on the risk provided prior to placement, including how declared values have been arrived at​
• Insurers are also more carefully reviewing values after an insured loss, which not only requires owners to be open on how the insured values were arrived at, but also requires them to provide supporting detail on the assets impacted​
• An independent advisor, specialising in reinstatement cost assessments for insurance, offers clients the comfort that, not only have they got the correct declared values, but that they will have the supporting information to respond to insurers quickly and easily during placement, and to speed up claim settlement in the event of a loss. 

Conclusion

While there is a role for property consultants, contractors and quantity surveyors in the management or development of a policyholder’s asset portfolio, this doesn’t always equate to the correct expertise to arrive at appropriate declared values for property damage insurance policies.  ​

If the assumptions adopted by a valuer do not match to what is expected by the various stakeholders, or what is stated within the insurance policy, the insured can end up exposed to underinsurance, or they could pay excess premiums. ​

This issue is of particular concern when figures are arrived at through computer modelling or by indexing up historic costs.​​

When choosing an advisor, best practice is to review their insurance track record, the experience of the individual team members, their independence in providing the advice and their ability to apply the correct approach to the reinstatement cost assessment of the assets. ​

Key highlights

• Asset registers are designed for accounting purposes – insurable assets may differ from those included in financial statements
• Changes to supply chains, technologies and market sentiment can quickly influence costs
• Building regulations, environmental standards and construction methods are continually changing which may not be reflected in indexed historic costs
• Indices are generic by nature. Applying these to individual facilities or locations can present challenges and produce inaccurate results
• Modelling and indexation have a place when determining declared values, but caution is required and a regular independent review by qualified valuers can be an essential check and balance.

Conclusion

Accurate assessment of reinstatement costs using asset registers is always challenging, especially if the base accounting data is limited in terms of description, or if the entries are not fully representative of the insured assets. Even if the historic records are accurate, and sophisticated models are used based around applying the correct index to individual asset register entries, the resulting estimated values need thorough analysis, benchmarking and appraisal before they can be used as the basis for declared values. For example, computer equipment has fallen in cost over the last decade on a like for like basis, while at the same time the cost of production equipment has increased. So, how do you index a computer-controlled machine tool?

Choosing the right index is not always straightforward and requires a detailed knowledge of the subject assets and an understanding of the indices available. Conducting a regular independent and detailed insurance assessment is still the most defendable way to ensure that declared values submitted to insurers are correct and defendable.

We are proud to be a specialist partner with Aviva, a leading UK insurer, to provide their clients with specialist plant and machinery valuation services. We support Aviva commercial customers nationally and internationally.  Charterfields provides insurance assessments for all asset categories, with reports designed around a client’s specific cover programme.