Most standard house insurance, contents insurance, office insurance, or shop insurance policies are designed for occupied properties. Whether the occupant happens to be a homeowner, a tenant or a small business (in case of commercial property). Insuring unoccupied commercial buildings is a lot more complicated because empty properties are classed as non-standard and thus need a specialist insurance policy.
The reason a standard insurance policy won’t cut the mustard is because commercial premises are treated as a high insurance risk. That might be because their insurance claims data suggests that empty buildings have a higher risk of water damage, rising damp, vandalism, burglary, or squatters. But whatever the reason for it. If your property is going to be vacant for an extended period of time (more than 30 days) you will need to invest in a policy that takes those elevated risks into account. No matter if this is due to renovation works or the end of the tenancy.
Why are vacant properties hard to insure?
Empty properties have a higher risk of water damp, mould, rising damp and even fire damage because they are left unattended for extended periods of time.
Squatters are much more likely to target an empty commercial property. Offices or shops particularly if they have been vacant for a long time. Empty properties are more likely to experience vandalism than occupied properties. Most of the time, they also represent an easier target for thieves. Since there is much less chance of a burglar to be caught in the act.
All those increased risks translate to high insurance premiums when signing up for unoccupied property cover. Since insurance providers will take into account the increased likelihood that they might have a claim.
Insurance for unoccupied commercial buildings is extremely difficult to arrange compared to standard commercial insurance. Many insurance companies do not like to insure the properties as they represent a high risk. Insurers are reluctant to provide cover and premiums can often be higher compared to other building types. We can still obtain insurance covers for you but the actual cover itself may be quite restrictive.
Should I take professional advice on how to protect my unoccupied commercial property?
Do I need to look at the security of my property?
Yes, we would suggest that you, first of all, do a risk assessment of the property. This is to see if there are any potential points of entry for someone looking to break in. Seek local advice from the police of whether there could be a problem with an empty property. We would suggest that you secure the perimeter to deter people from entering the property. Also, you can look at installing closed-circuit TV and alarms.
You will often find that CCTV is a must have for anyone looking to protect a commercial property. It will go a long way to potentially reducing the buildings insurance risk which improves the insurance premium. You should then ensure that any important equipment at the property is either removed or secured. It would also make sense to advertise the security on the outside of the building to let potential criminals know that they are being watched. We would suggest that you also carry out regular checks or have somebody carry these out for you.
The more security measures that you put in place the more likely your premium will come down. It is essential to show your insurance company that you are doing your best to protect your investment.
Can I take out a policy for a short or long period?
Unoccupied commercial property insurance is extremely difficult to obtain. We do have markets that will help you cover your property but terms can be restrictive and premiums high. It is important that you do your best to ensure that security professionals check your property. This is to ensure that you are doing the best you can to protect it. If you would like a quote for an unoccupied property insurance request a call back and speak to one of our team.