Whilst most commercial property owners have a desire to ensure their property is tenanted, some may think it’s a hassle-free process if or when their property is vacant or between tenants. Our latest blog looks at the business insurance requirements for unoccupied commercial premises, as it’s not as straightforward as it seems.
The first thing to note is that business insurance for unoccupied commercial properties has different criteria from occupied commercial buildings. Whether your commercial premises are unoccupied due to renovation works, change in trading behaviour or damage, it’s vital that you have the appropriate levels of cover in place, or you could find yourself on the receiving end of a hefty bill.
1. What does unoccupied commercial property insurance cover?
Insurance companies often insist on stricter requirements for security, and covers are typically limited to FLEA – Fire, Lightning, Earthquake and Aircraft.
2. How much notice do I need to give my insurer that my commercial property will be unoccupied?
This varies depending on your policy, but we recommend giving as much notice as possible to ensure the correct cover is in place.
3. What information will I need to arrange unoccupied commercial property insurance?
In addition to the standard underwriting questions for commercial property insurance such as property age, building construction type and location, you may also be asked for the following:
- What is the reason for the empty property?
- How long will the premises be unoccupied?
- Does the premises have an alarm or additional security protection?
- Will utilities be switched off at the mains (except to maintain fire or alarm systems)?
- How often will your representative be visiting the premises? (Every seven days is a typical requirement and what Vacant Property Eye provide as a standard)
- Have you made provisions to remove all post and rubbish from premises?
4. What is the cost of commercial property insurance?
The cost varies depending on several of the factors above. Insurers ask for detailed information to assess the risk of your building remaining empty. This can include:
- The length of time a property will be left vacant
- The range of security on-site such as intruder alarms, manned guarding and patrols or CCTV such as the services provided by Vacant Property Eye
- Intruders and forced entry into the premises
- Your claims history and any open claims
5. Are there any standard exclusions in commercial property insurance?
You must check your policy carefully to know what’s covered and what’s excluded; however, there are three main exclusions in most commercial property insurance policies.
- Unoccupied properties typically need different insurance coverage, and you should always ensure your insurance provider is aware that your property is unoccupied
- Wear and tear is typically not covered for damage caused by everyday use or because of poor maintenance
- Damage from vermin or pests is often excluded from many policies
6. Why should I seek a security company to manage my unoccupied premises?
Whilst an occupied property is desired, that isn’t always the case and seeking the services of a vacant property specialist, such as Vacant Property Eye, will give you peace of mind that everything is ok, plus lend a helping hand to reduce your insurance.
Depending on the service you choose, our dedicated security experts will conduct weekly inspections and meter readings, respond to alarm or sensor motion, and facilitate regular patrols to ensure your premises remain safe and secure from unwanted visitors.
7. What shall I do next?
First, if your premises are vacant or soon to be, speak with your insurance provider. We recommend establishing the requirements they need and then seeking the advice of a vacant property specialist such as VP Eye to provide a free no-obligation quote and further understand the security risks to vacant properties. Get in touch with our team at info@vp-eye.co.uk
