Day one’ basis of reinstatement cover

A reinstatement cover variant. The sum insured is in two parts – the declared reinstatement value of the property at inception (day one) and an added provision for inflation (between 115 per cent and 150 per cent) during the policy and reinstatement periods. An agreed percentage of 150 per cent attracts a flat rate of 15 per cent above the normal premium. Alternatively the rate is 7.5 per cent with the premium being adjustable at the end of the year. ‘Day one average’ applies the actual value at risk on ‘day one’ against the ‘day one’ declared value rather than the value at risk at the date of reinstatement against the sum insured.