New energy efficiency rules are reshaping how homes are built and renovated across the UK.
The Future Homes Standard, tougher EPC requirements, and Scotland’s Heat in Buildings Bill are all driving upgrades in insulation, heating, and energy performance.
While these measures will cut carbon and lower bills, experts warn they could also leave thousands of homes underinsured if rebuild costs aren’t updated.
New energy standards bring hidden risks
The Future Homes Standard, due to come in 2025, will require all new homes in England to produce 75–80% fewer carbon emissions. This means higher-spec materials, thicker insulation, low-carbon heating systems, and improved ventilation.
At the same time, landlords must prepare for stricter Energy Performance Certificate (EPC) rules, with rental properties in England and Wales needing to reach a minimum EPC rating of C by 2030. Scotland is going further with its proposed Heat in Buildings Bill, which will push owners of existing homes to upgrade heating and insulation.
All of these measures will improve efficiency, but they also mean buildings are becoming more expensive to construct, and therefore more expensive to rebuild if something goes wrong.
Retrofits driving up rebuild costs
Even outside the new standards, many homeowners are already retrofitting to save on energy bills. Common upgrades include high-performance insulation, triple-glazed windows, airtightness works, and renewable heating such as air source heat pumps.
The problem? These measures cost more to install than traditional materials and methods, and that higher cost carries over to insurance.
If a property with these upgrades were damaged in a fire or flood, the rebuild would now be significantly more expensive, yet many insurance policies don’t reflect this change.
According to RebuildCostASSESSMENT.com, 76% of UK homes and commercial properties are currently underinsured, meaning owners would only get part of the payout needed in a claim. As retrofits become more widespread, that gap could widen even further.
Don’t get caught underinsured
Sharon Masters, Surveyor and Technical Lead at RebuildCostASSESSMENT.com, says many renovators are overlooking this hidden consequence:
“Even modest improvements like new insulation or efficient glazing can push rebuild costs higher. Without updating cover, renovators risk being underinsured just when they need protection most.”
The advice for renovators and landlords is straightforward:
- After carrying out energy upgrades, arrange a fresh rebuild cost assessment.
- Tell your insurer about any changes to building specifications.
- Make sure your policy reflects today’s rebuild value, not yesterday’s.
Failing to update cover could leave property owners footing a big bill. In other words, the very improvements designed to future-proof homes may create a financial vulnerability if insurance isn’t kept up to date.
