In construction claims, the original contract value does not necessarily reflect the cost of reinstating damaged works. McLarens Technical Director Anthony Hutchings explores the distinction between cost and value in contractor’s all risks (CAR) claims, why actual reinstatement costs may differ from historic contract pricing, and the importance of separating claim quantum from questions of underinsurance and sum insured adequacy.
Cost vs Value: Why the original contract price doesn’t determine the cost of a construction claim