We were blown away by the incredible turnout, the energy in the rooms, and the thoughtful engagement from attendees at each event. From start to finish, it was a huge success.

We’ve put together a summary of the key takeaways below.

• ‍Valuations, Variations & Vulnerability: The Construction Trends Shaking Up Insurance‍
• Caught in the Gap: Why Underinsurance Is a Risk We Can’t Afford to Ignore
• My Home Was Hit by a Tornado - Now What?
• Behind the Build: What Really Happens When Repairing Damaged Property
• BEYOND THE BUILD Expert Panel
• Summary of Questions & Answers from All Five Events 

Valuations, Variations & Vulnerability: The Construction Trends Shaking Up Insurance

Alex Harris – Lead Quantity Surveyor, Construction Cost Consultants

Alex spoke on the importance of involving a Quantity Surveyor (QS) across all project types, from small-scale home extensions to major $100m+ developments.

He gave a snapshot of current market conditions, outlining the economic headwinds affecting the construction industry, including labour shortages, and rising insolvency rates. However, there was a more positive outlook ahead, with lower interest rates starting to revive previously shelved projects, and inflation projected to remain below 3%. This points to greater cost stability across materials and labour moving forward and increased investor confidence.

During the Q&A, Alex addressed a common question about the ~6% inflation provision used in Construction Cost Consultants' rebuild valuations, despite current inflation sitting closer to 2.5%. He explained that CPI figures from the Reserve Bank are retrospective, whereas Construction Cost Consultants' valuations are forward-looking, covering the next 2–3 years including not just inflation, but real-world price escalation of construction materials and labour.

Case studies reinforced the key message: bringing a Quantity Surveyor in early and maintaining consistent engagement throughout the project is critical. Projects that skip this often face costly variations, time delays, and in worst cases, end up in formal dispute resolution like arbitration.

Link to his presentation.

Caught in the Gap: Why Underinsurance Is a Risk We Can’t Afford to Ignore

‍Jax Wilson – Head of Personal Lines Portfolio, ANDO

Jax Wilson delivered a compelling presentation on one of the insurance industry’s most pressing challenges: underinsurance - a widespread issue affecting 85% of New Zealand homes. On average, it takes a homeowner 2.5 years to adjust their sum insured, often leaving them dangerously exposed in the event of a major loss.

Jax emphasized that the only reliable way to set an accurate sum insured is through a formal valuation, ideally carried out by a Quantity Surveyor (QS). While online calculators are widely used, she was clear that they’re grossly inaccurate and should only serve as a starting point for deeper discussions - not a final figure.

She shared several sobering case studies that highlighted the stark gap between the sums insured and actual rebuild costs. These real-world examples illustrated just how financially devastating it can be when homeowners are significantly underinsured - particularly in cases of total loss from fire or explosion.

“New Zealand is one of the riskiest places in the world to live,” Jax reminded the audience. “We’re a small nation sitting on a major fault line, part of the Pacific Ring of Fire. We build homes on coastlines, in valleys, and even on geothermal and seismic land.” With natural risks increasing and largely out of our control, she urged the industry to focus on what is within our power: ensuring clients are properly protected when disaster strikes.

That starts with education and open, honest conversations. Clients need to understand the true value of their homes and be encouraged to review their sums insured every year.

Setting the correct sum insured isn’t a one-size-fits-all approach. It requires careful consideration of many property-specific factors, including:

• Regional location
• Access to the site
• Building techniques and materials
• Engineering and foundation complexity
• Current labour and material demand
• Inflation and supply chain pressure
• Demolition and debris removal costs

For more details, Jax directed attendees to the Ando Sum Insured Guide, a resource designed to help clients and advisers understand what needs to be factored in when determining appropriate cover.

Link to her presentation.

My Home Was Hit by a Tornado - Now What?

Dani Simpson – Homeowner & Tornado Survivor (Waihi Beach)

Dani Simpson bravely shared her deeply personal and traumatic experience of surviving a tornado that destroyed her family’s home in Waihi Beach.

After COVID, Dani, her husband Chris, and their daughter Emma decided to make a lifestyle change. They purchased a beautiful hilltop section at Waihi Beach, planning to build their dream home. While waiting for the build, they rented locally -but when their landlords returned, they needed a new place to live. To avoid rushing their build, they bought a temporary home just 150 metres from the beach.

Using an online insurance calculator, they insured the home for $800,000. Feeling that number was too low, they bumped it up to $1 million - just to be safe. In early February 2023, they moved into the two-storey home and quickly filled it with laughter, and love with their friends and family.

But just three weeks later, their lives were turned upside down.

On a Saturday morning in late February, Chris looked outside and said, “The sky looks weird.” Moments later, it escalated to, “I think it’s a tornado!” Dani and Emma jumped out of bed and rushed to the basement with Chris. Emma later said she could see daylight through the ceiling manhole as the house shook violently around them. The sound was deafening. It was the longest 20 seconds of their lives.

After the tornado passed, Dani called 111 - and then their insurer. When she reported the tornado, the call centre responded, “We don’t have ‘tornado’ as an option in our drop-down menu.” The loss was recorded simply as “Other.”

The family worked quickly to secure the home from incoming weather. When a Loss Adjuster arrived, his initial assessment was that the damage might be “mostly cosmetic.”

In the following months, things went from bad to worse. Dani’s mother was diagnosed with terminal cancer. Their first rental flooded. Chris slipped on a wet deck and broke his back. Meanwhile, they battled with the Loss Adjuster over the scope of damage. The initial view was that the kitchen, some joinery, and the roof could be repaired - for just $380,000.

Refusing to settle for that, the Simpsons hired their own engineer and Construction Cost Consultants. The independent assessment revealed the house had shifted by 5 degrees - structurally unsound, and a complete write-off. The rebuild cost was calculated at $1.2 million.

Upon Dani’s insistence, the insurer brought in their own engineer, who confirmed the total loss. Six months to the day after the tornado, the Simpsons received their $1 million insurance payout.

Though they were underinsured by $200,000, Dani expressed gratitude that they hadn’t relied solely on the online calculator, which would have left them $400,000 short.

Behind the Build: What Really Happens When Repairing Damaged Property

‍Nathan McCullum - Managing Director & Chris Brebner - Director, TPW

Nathan and Chris from TPW, a specialist construction company focused on refurbishments and rebuilds after property loss, shared valuable insights from their work in the field. With a skilled team of 40 across Roofing, Building, and Maintenance divisions, TPW is well-versed in navigating complex rebuilds and insurance-related projects.

They emphasised the importance of involving contractors early in the process - a strategy that consistently helps avoid time delays and costly overruns. A key takeaway was the distinction between Reinstatement and Betterment. While reinstatement refers to restoring a property to its previous state ("like for like"), in practice, especially with modern building codes, it’s more about achieving compliance for life.

Using recent examples, they illustrated this point - such as buildings suffering repeated water damage during several so-called “100-year” rain events. TPW not only repaired the damage but also recommended practical upgrades like larger gutters and downpipes. While not covered by insurance (classified as Betterment), these upgrades are smart, future-focused improvements that prevent further issues.

Another key message was around the rising cost of construction, driven largely by stricter compliance requirements - costs that are unlikely to go down. That’s why TPW champions building a trusted, collaborative team over simply choosing the lowest tender price. A cohesive team working together from the start can lead to significant savings in both time and money.

They also shared an impressive case study: a $5 million rebuild of the Crockers Building, which had been devastated by fire due to a failed fluorescent light and HVAC system that unintentionally spread the smoke. The project faced multiple challenges - including outdated structural drawings, hidden damage, and confusion around passive fire regulations. One absurd delay? Five parties, three meetings, and two weeks just to decide who should replace a $1,000 stair nose. Despite these hurdles, TPW successfully managed the compliance process and delivered an outstanding rebuild.

Watch the Crockers Rebuild Video

Nathan and Chris also highlighted a common pitfall - requesting three quotes for sub-trade work mid-project. While well-intentioned, this often wastes time and causes delays for everyone, including insurers. Instead, they recommend a clear, well-defined Bill of Quantities (BOQ), created by someone with both trade and regulatory knowledge. This ensures that quotes are based on a consistent scope, eliminating misunderstandings and hidden costs later.

Their final message was clear: success lies in collaboration and communication - among insurers, loss adjusters, landlords, tenants, and builders with their team. Breaking down silos leads to faster, safer, and higher-quality outcomes for all stakeholders.

Nathan’s motto says it best: “Better Never Stops.”

BEYOND THE BUILD Expert Panel

We wrapped up each event with a lively and insightful Panel Discussion featuring some of the industry’s sharpest minds.

Joining us were Andy Thomson and Brett Parekura from Construction Cost Consultants, Jax Wilson from ANDO, Nathan McCullum of TPW, plus a local Broker at every location - bringing diverse perspectives and expert insights to the conversation.

A huge shoutout and heartfelt thanks to our fantastic local Brokers who made each event truly special:

• Steve MacManus, Commercial & Rural Insurance Brokers – Dunedin
• Olivia Chisholm, PSC Insurance Brokers – Christchurch
• Bernie Kane, Meridian General Insurance Brokers – Wellington
• Ben Rickard, Builtin Insurance Brokers – Hamilton
• Richard Spedding, Rothbury Insurance Brokers – Auckland

Your expertise and energy helped make BEYOND THE BUILD 2025 an unforgettable experience!

Summary of Questions & Answers from All Five Events

• Tornado Claim Experience
• Panel Insurance Broker
• Construction Cost Consultants
• Panel Insurer
• Panel Quantity Surveyor
• Panel Builder

Tornado Claim Experience

Q: Can you please explain how your Broker assisted you during your claim process?

A: We didn't have a Broker. After our formal complaint, the insurer decided to bypass the Loss Adjuster and work with us directly, appointing their own engineer who verified the house was a write-off. We felt heard and received our final settlement quite quickly after that. However, we now have a Broker looking after us, and she's amazing!

Q: How long did it take for your house to be rebuilt after the loss?

A: Approximately 12 months, including planning. It was no cheaper, but using a company to build a transportable house seemed more efficient. 

Panel Insurance Broker

Q: Has there been a time when you've talked a client around on underinsurance to change their opinion?

A: Quite a few times, especially where they're well-established people who don't appreciate the true value of their properties. In these cases, we've shared valuations for similar properties where the client can then get their heads around their perceived value versus true rebuild cost.  

We also insist they obtain a valuation. Unfortunately, not everyone takes our advice and ultimately, it's the client who decides.

Q: How challenging is it to get clients to review their sum insured at the time of their annual renewal?

A: It can be quite difficult - especially when the build period extends beyond 12 months. Clients often struggle to accurately estimate costs 2–3 years ahead. The most problematic time for a loss is around day 360 of the policy term, when a claim could continue for another year or more, making underinsurance a real risk.

Q: Underinsurance seems complex - what are the key things to get right when helping clients ensure proper rebuild cover?

A: Most Brokers will only deal with one total loss in their careers, so it’s vital to talk to clients about actual rebuild costs - not what they paid or the property’s market value. Taking the time to get it right is essential, especially with domestic insurance making up a large part of many books. Be clear about the advice you’re giving and your recommendations. Valuations from Construction Cost Consultants are quick and affordable - and if a client’s at least taken steps to review their sum insured, I’m mostly happy with that.

Q: Some of our ageing clients are looking to downsize and are deliberately underinsuring their homes based on that intent. Do you have any advice on how to approach this conversation with them?

Broker’s Response: We recently had a case where Construction Cost Consultants valued a property at $4.5 million, but the owner, who built it himself, chose to insure it for just $2.5 million. That’s a significant shortfall. As Brokers, we can’t force clients to insure for the full rebuild value, but it’s important they understand the risks. For example, if there were a partial loss of around $2 million, it would trigger serious complications and scrutiny at claim time, potentially affecting reinsurance costs down the line.

Insurer’s Response: In situations like this, Functional Replacement might be a more appropriate option - especially if the client doesn’t intend to rebuild the same home. While ANDO doesn't currently offer functional replacement, it's a conversation worth having. The real concern is that clients may change their minds after a loss, only to find they’re drastically underinsured and left out of pocket in a total loss scenario.

Q: I used an online calculator for my own home, and even after upscaling the inputs, the result seemed too low. I then engaged Construction Cost Consultants, and their rebuild valuation came out 60% higher. This highlights a broader issue - our industry continues to promote calculators, which often contribute to underinsurance. Shouldn’t there be incentives for homeowners to obtain professional rebuild valuations, given that most properties are likely underinsured?

A: Andy noted that a direct insurer engaged us to conduct 50 rebuild valuations across the country, comparing our assessments to the results from an online calculator. On average, the calculator underestimated rebuild costs by 65%, highlighting a significant underinsurance issue.

Q. Insurance is often viewed as a grudge purchase, so asking clients to spend an additional $750 on a valuation - only to be told their sum insured should be higher, resulting in a higher premium - can be a hard sell. From the client's perspective, it's just more money for something they don’t believe will happen. What more could insurers or ICNZ do to make professional valuations a standard part of the process, rather than an optional add-on?

A: One option could be offering a discount on the premium or contributing to the cost of the valuation. This would help encourage homeowners to obtain an accurate rebuild assessment without feeling they're being penalised for doing the right thing. 

Construction Cost Consultants

Q: When conducting a rebuild valuation, how do you account for bespoke elements?

A: All valuations are broken down into labour, plant, and materials. For bespoke elements, we ask clients to highlight any specialist features - for example, Taonga at a Marae, unique architectural details, or custom-built installations. Anything that involves specialist craftsmanship or requires unique treatment should be identified so it can be appropriately factored into the valuation.

To support this, our Building Assessors are trained to engage directly with the client and ask whether there are any specific features that need to be noted. For example, we once completed a valuation where the property manager conducted the walk-through. After the report was issued, the client said, “You’ve missed my wine cellar.” We explained that the property manager hadn’t mentioned it, to which the client replied, “That’s because they don’t know about it!”

While it’s always easier when clients share this information upfront, we make a point of asking.

Q: What is your process for valuing rebuilds involving heritage or historic features?

A: Our Building Assessors document all existing features on site, carefully recording details and supporting them with photographs. In the event of a total loss, the building would be reconstructed to meet current regulations, while retaining as much of its original character and historic features as possible.  If there were the possibility of salvaging any materials from the loss, we would expect every effort to be made to use them in the rebuild.

Q: How do regional factors and specific site conditions influence your rebuild valuations?

A: We value regionally as well as by specific location. We take into consideration how close they are to a port and labour rates, etc. The property could be on reclaimed land, a swamp, etc. Christchurch would be a great example. These factors are all considered for their rebuild value. If you had a house built in Manawatu and the same house on Waiheke Island, the costs would vary greatly.

Q: How do you approach rebuild valuations when a building’s use doesn’t align with the insurance policy - for example, a residential house being used for short-term accommodation?

A: Our valuation focuses on the physical building itself - its use doesn’t directly impact the rebuild cost. However, we rely on guidance from the Broker to ensure the valuation matches the client’s insurance policy. For instance, if a residential house is insured under a Material Damage policy typically meant for commercial properties, a Commercial Rebuild Valuation will be necessary.

Q: What happens if a feature like the wine cellar isn’t identified and a loss takes place?

A: There’s a clear distinction between a Valuer and a Quantity Surveyor. Our team includes qualified Quantity Surveyors who use detailed, data-driven methods and proprietary technology to ensure accurate valuations. While no system is completely infallible, our processes are designed to minimise the chance of missing features like a wine cellar. In the rare event that something is overlooked, we have professional indemnity insurance in place to manage such situations responsibly.

Q: I had a client who was severely underinsured for Demolition and Removal of Debris because the building contained asbestos. Would your valuation pick this up?

A:  Yes, it would. Our Building Assessors visit the site and base their pricing on what they see and what they’re told. For buildings from the 1960s and 70s - where asbestos is common - we factor in the additional costs associated with handling and disposing of hazardous materials.

Q: Why do inflation provisions at renewal vary significantly between the three insurers and differ again from the Construction Cost Consultants' valuations?

A: While we can't comment on how insurers determine their rates, our inflation provisions are based on forward-looking construction cost trends, rather than retrospective indicators like the Consumer Price Index (CPI). During the COVID period, some parties applied very high inflation percentages due to widespread uncertainty. In our case, we adopted a more data-driven and consistent approach, with our highest applied provision capped at 10%. We continuously track real-time market data to ensure our figures remain accurate and aligned with actual cost movements. Importantly, we do not include contingency allowances in our valuations, as these can lead to significant overestimations.

Q: Can you explain why tiny houses cost more to build and how we can best insure them?

Construction Cost Consultants’ Response: Kitchens and bathrooms are the most expensive rooms in any house. A tiny house is primarily these two rooms with bespoke joinery, fixtures, and fittings, which increases the average rebuild cost per square metre, higher than a standard house.

Insurer’s Response: If a tiny home can be towed, it's treated as a vehicle, which is subject to a WOF and insured as such. If it has structures built around it with no wheels, it's subject to a code of compliance and insured as a house.

Q: How does a property's location influence its valuation?

Construction Cost Consultants’ Response: Yes, location is a key factor in property valuation. For example, Queenstown is one of the furthest locations from a major port, which significantly increases transport costs. In contrast, towns with nearby ports typically have much lower logistics costs. Labour rates also vary across the country - Queenstown has some of the highest labour costs, while places like Invercargill are far more affordable in that regard. All of these regional differences are considered when determining rebuild values. Quantity surveyor rates are geo-coded to reflect these variations.

Insurer’s Response: At ANDO, we use CRESTA zones to assess full replacement values. However, this approach has become increasingly complex due to the many variables involved. Each region presents unique considerations in terms of risk and cost, which is one of the reasons online calculators can often produce inaccurate estimates.

Q: Premium affordability is a concern, particularly in Wellington. If a client with a large, older villa wouldn’t rebuild to the same value after a total loss, is functional replacement an option?

Construction Cost Consultants’ Response:
Construction Cost Consultants calculates the rebuild cost for each individual property. We can also provide a Functional Replacement cost based on the client’s preferences in the event of a total loss.

Insurer’s Response:
With rising premium costs and growing concerns about affordability, we’re frequently asked about this. We’ve moved to risk-based pricing to ensure clients are correctly insured. For instance, increasing cover by $100,000 often results in only a modest premium increase. Considering higher excesses can also help manage costs. While ANDO doesn’t currently offer functional replacement cover due to traditional challenges, we recognise this is an important topic that the industry needs to explore and address.

Q: With recent changes in the commercial insurance market, insurers are becoming more flexible about valuation requirements and often set criteria based on the building’s size or value. When would you recommend updating these valuations?

Construction Cost Consultants’ Response: Valuations should be updated every two years, and ours include figures for both year 1 and year 2. Each property is individually assessed on-site, so building size does not affect the valuation.

Builder's Response: Compliance costs, particularly for fire safety, are changing quickly. Valuations reflect current compliance requirements, so regular updates are essential to ensure the sum insured accurately covers replacement costs.

Q: What is the average cost of a Residential Rebuild Valuation?

A: Construction Cost Consultants has one fixed price for a single dwelling anywhere in New Zealand of $749 incl. GST.

Q: Why should a client engage a Quantity Surveyor rather than a Registered Valuer?

A: The accuracy provided by Quantity Surveyors is crucial, as we work directly within the construction industry, using up-to-date compliance standards and current building costs. We deliver detailed Elemental Cost Plans, which serve as precise scopes of work during claims, ensuring an ‘apples-to-apples’ comparison for Bills of Quantities and rebuilding quotes.

We have Building Assessors located throughout New Zealand, and our Commercial Rebuild Valuations include specific calculations, such as the Fire Emergency Levy.

Recently, I addressed the Government Select Committee to highlight that Registered Valuers lack training in construction costs. Their expertise lies primarily in market valuations, rent reviews, and similar areas. Given this, I recommended that, with the upcoming changes to the Valuers Act 1948, Registered Valuers should no longer be permitted to perform rebuild valuations for sum insured purposes.

Q: What are FENZ changing on 1 July 2026?

A: Fire Emergency Levies will be applied to the Sum Insured (Replacement Value, where applicable), rather than the Indemnity Value or, in the case of Construction Cost Consultants, the FEL Calculation - where current exempt items under the Act are removed.

The list of exempt items is changing; retaining walls, swimming pools, and tanks will no longer be exempt from 1 July 2026.

Construction Cost Consultants maintains a strong working relationship with FENZ and has provided feedback on the May 2025 draft Guide. We are currently awaiting clarification on the definition of "Fees" and expect formal requirements around proof of calculation. Once we receive further information, we will promptly communicate updates and adjust our systems to ensure full compliance with the new regulations.

Q: Can you provide insights into the latest trends in rebuild values for residential and commercial buildings?

Commercial: Over the past year, we’ve observed widespread overinsurance in the commercial sector. High inflation following COVID, compounded over four years, has led to sums insured that no longer reflect current market conditions.

Residential: As Jax highlighted in her presentation, up to 85% of the residential market remains underinsured.

Overall: Proper insurance across the market is essential to ensure insurers have sufficient funds to cover claims when needed.

Q: For our mixed-use body corporates, how difficult is it to distinguish between the residential and commercial elements?

A: We need to work closely with the client and/or Broker to identify the different spaces and assess the various elements that comprise the building. These don’t impact the overall result of the valuation, so we rely on your guidance regarding the specific information you need.  While on site, our Building Assessor can gather additional details/ information, such as the floor area for each space, as required, but you need to let us know what you need.

Q: What determines a 'Portfolio' when quoting for Construction Cost Consultants Rebuild Valuations?

A: For three or more properties owned by a client or a scheme – for example, Squash Clubs – we will provide discounted rates. Contact us directly to discuss these.

Q: I have a Registered Valuer’s report that differs significantly from a Quantity Surveyor’s valuation. How should I approach this conversation with my client?

A: We recommend using a Quantity Surveyor for rebuild valuations, as we work directly within the construction industry and base our assessments on up-to-date, real-world cost data. While we can’t comment specifically on the Registered Valuer’s assessment, it's important to note that Registered Valuers are not trained in providing detailed rebuild valuations.

Q: What's your advice on how to discuss retaining walls with our clients, and is there a cost per square metre we can use?

A: We recommend engaging a Quantity Surveyor. While we're not engineers, we can assess materials, measure retaining walls, and estimate reinstatement costs. Unlike Registered Valuers, who are increasingly excluding retaining walls, we also evaluate the potential impact on the main asset if a wall fails. Our app captures details for up to 30 retaining walls per site - including measurements, materials, photos - and all of this is accessible through our Portal.

Access to the site is another key factor. For example, if materials need to be delivered via crane due to limited access, that could add around $5,000 to the rebuild cost. These practical considerations are included in our methodology.

Q: Where a loss has occurred, do you offer a service to support the client in the rebuild?

A: Yes, Construction Cost Consultants does, and we'd like to be involved in the rebuild as a Quantity Surveyor so we can manage the costs on the way through.

Q: Do you find that Indemnity Periods are often inadequate at claim time?
Insurer’s Response: Yes, we frequently encounter this issue, especially with major losses.

Construction Cost Consultants’ Response: In our reports, we specify the estimated rebuild period - though this doesn’t factor in consent processing times. This information can help guide your conversations with clients to determine the appropriate Business Interruption Indemnity Period.

Panel Insurer

Q: With increasing weather events, what impact does this have on insurance companies and underinsurance?

A: It’s a challenge for everyone. Take Australia, where flood cover is often unavailable - hopefully, New Zealand doesn’t head that way. Infrastructure upgrades and risk mitigation, like improving drainage, are essential but slow to happen. I remember visiting a property in Whangarei Heads at risk of landslide; the agent didn’t even see insurance as a concern. This highlights the need for better communication, so people understand their risks. Without action, more land could become uninsurable - and that’s a big issue for a small country like ours.

Q: Do any insurers endorse using online calculators?

A: Yes, I believe some insurers are offering full replacement on some risks where there is a current online calculation provided.

Q: If Dani insured her house for $800k using the online calculator, but the rebuild cost was $1.2m, how does that impact the insurer?

A: If the loss was because of fire or explosion, ANDO would have to pay the full $1.2 million.

Q: So, in cases of underinsurance, who ends up covering the shortfall?

A: Ultimately, we all do. The cost can fall back on homeowners, communities, or even taxpayers - especially in cases where there’s no insurance at all and the Government steps in to support the recovery.

Q: How do you factor the inflation provision added to house insurance at each renewal?

A: ANDO are guided by the current CPI and escalation in building costs. A lot of factors are considered before that percentage is set.

Q: Are some parts of the country more prone to underinsurance? Has Christchurch improved after everything it’s been through, compared to areas that still think, “It won’t happen to us”?

A: Christchurch has come a long way. You’ve been through a lot with the earthquakes, and many of you have done a great job working with clients to get the right sum insured - you’ve been leading that conversation longer than most in the country. But even in Christchurch, we still see underinsurance. It’s also a challenge in smaller, more remote towns, where access and awareness can be limited. been through a lot with the earthquakes and have done a great job speaking with your clients to get the right sum insured, and have been doing that for longer than anyone else in the country, but we do find that there is still underinsurance in Christchurch. The other challenge we have is in the small towns across the country, where it's harder to get to.

Q: Why do people take 2.5 years to review their sum insured?

A: I believe the main concern is the increased cost of insurance. For example, raising the sum insured leads to higher premiums, and many clients feel, 'It won’t happen to me.' Brokers can help by discussing the actual cost of increasing coverage, as it might not be as expensive as the client thinks, and by offering excess options to make any increase more manageable.

Q: It’s common for Builders’ quotes to lack detailed breakdowns, which often isn’t sufficient for insurers and results in delays while chasing further information. Is this standard practice, and why isn’t a cost breakdown typically provided upfront?

Builder's Response: No, it’s not standard practice, but it does happen frequently - and not just with Builders, but also with subcontractors. Having detailed quotes from the outset is essential for accurate project planning. Best practice is to clearly outline labour and material costs upfront. Retrospective pricing often raises questions and can lead to disputes. Working with an independent Quantity Surveyor or adopting an open-book approach with an agreed margin benefits everyone. There's no reason for a lack of transparency - the industry is evolving, and collaboration from the start leads to better outcomes for all parties.

Insurer's Response: From an insurance perspective, the more detail we have, the better. At claim time, having a comprehensive document that breaks down all components of the build helps us clearly understand what we’re dealing with and speeds up the process.

Quantity Surveyor's Response: For us, it all comes down to scope. Getting the scope right at the beginning ensures all parties are pricing from the same set of assumptions, which leads to consistency, fairness, and fewer surprises down the track.

Q: Underinsurance is clearly a concern in the event of a total loss, but how does it affect a claim in the case of a partial loss?

A: When underinsurance is identified during a claim, our claims team will flag it with the underwriting team. They will then liaise with the Broker, requesting a discussion with the client to review and potentially update the sum insured.

Q: What is the process for getting approval to appoint a Quantity Surveyor as part of the claim costs?

A: Construction Cost Consultants and ANDO have an agreement in place to help in this area. We’ve also developed a tool that helps our claims team clearly identify the scope of work required. Ultimately, our goal is to support the client as effectively as possible by providing whatever assistance is needed.

Panel Quantity Surveyor

Q: What's the difference between inflation and price escalation?

A: Inflation is typically based on the Consumer Price Index (CPI), which reflects the cost of everyday goods like food, beverages, and general commodities. Escalation, on the other hand, relates specifically to the construction industry and covers increases in costs for materials, labour, and plant. While there is some overlap - such as oil prices affecting both - inflation and escalation measure different types of cost movement.

Q: In the event of a major loss, is there any need to add an inflation provision to Demolition and Removal of Debris?

A: In practice, it’s difficult to accurately factor in an inflation provision for Demolition and Removal of Debris. After the Christchurch earthquake, for example, there was significant cost escalation - largely due to market pressure and urgency, not actual inflation. Our system is based on current market rates, which is the fairest and most realistic approach. In that case, the rush to get things done quickly drove prices up. If the process had been more phased, there may have been more room to manage costs.

Q: At what point does appointing a Quantity Surveyor become a good return on investment?

A: Building a project and preparing a rebuild valuation are two very different things. I've known the teams behind the online calculators for years, and even they admit that the tools aren't reliable for higher-value properties - particularly over $1 million. Despite that, banks and insurers have pushed for figures up to $2–$2.5 million, which is why those calculators come with so many disclaimers.

Hiring a Quantity Surveyor for something like a $100,000 extension might cost around $1,500 per month, but in the long run, it’s a smart investment. Having a Quantity Surveyor involved means the costs are properly managed, and the risk of underestimating is greatly reduced.

Panel Builder

Q: Why shouldn't we use group home buying rates as a guide to establish a sum insured?

A: Group home building rates, like those from GJ Gardner, reflect economies of scale - multiple homes built in one location with discounted bulk pricing. For example, a plumber may reduce their total fee for 10 houses. In contrast, a one-off rebuild doesn’t benefit from these discounts. Additionally, individual rebuilds involve extra costs such as site access, crane use, demolition, inflation, and other location-specific factors that group builds don’t account for.

Q: As an industry, how do we provide better interconnectivity to get clients better supported at claim time?

A: Engaging a Builder, Quantity Surveyor, and Project Manager from the outset - and having them work alongside the Loss Adjuster - ensures a more accurate and complete approach. Collaboration between the right parties allows for a detailed Bill of Quantities (BOQ) to be established, clearly outlining what’s required. Builders may not see the full picture, and Loss Adjusters may miss certain construction details. By working together, we combine the necessary expertise to ensure the job is done thoroughly and correctly.