Most property insurance policies include a clause that if a property – be it business premises or a residential dwelling – is left vacant for longer than a specified length of time, then it will not be covered unless an unoccupied property option is included.
The length of time that must pass before its deemed to be unoccupied varies from policy to policy. Since the Coronavirus outbreak and the enforced lockdown, some insurers have extended the vacancy limit but it’s important that you know where you stand so you can make the appropriate arrangements. With many businesses still being shut and commercial property remaining unoccupied, it is important to understand the risks and what you can do to help prevent any potential risks.
Potential risks of having unoccupied premises
Firstly, unoccupied buildings are an obvious target for theft, trespassing and vandalism. In addition to any loss or property damage that may occur, keep in mind that the owner of a property can be held liable for criminal activities or accidents that take place on the premises.
Unoccupied properties are also susceptible to damages such as fire, water damage, electrical explosions and mould. These incidents often occur in unoccupied buildings due to undetected issues, where someone in an occupied building may have recognised it. It is important to maintain your premises regularly as to prevent any damage that would not have been caused had your premises been occupied.
There may also be environmental hazards that the owner needs to consider. Facilities that store chemicals or other pollutants should ensure that materials are securely stored — the owner may be held liable for any materials that contaminate nearby natural resources. Underground fuel tanks present serious challenges and thus should be frequently inspected as well.
Another risk to consider that may be as a result of unoccupied premises is whether the tools of your trade are covered for working from home. Computers and other standard office equipment may be covered while you are at your normal place of business. Many of us are currently working remotely and employers are providing their employees with the equipment needed to continue working from home. It is important to check that this business equipment is covered against loss, theft or damage while at the employee’s address.
Five top tips for protecting an unoccupied property
Having premises laying vacant is a worry – even if you have cover in place – so there are some steps that you can take to keep property safe while you’re away – as appropriate in your circumstances:
- Turn off electricity, gas and water supplies at the mains and drain down all water systems. Leave sprinklers and any other fire suppression systems in operation and should this drag on into the autumn, make sure your heating comes on to prevent burst pipes.
- Ensure burglar and security lights are working and switched on. Should a thief attempt to enter your property, it is important to have the right security in place and working to prevent them from gaining easy access and leaving you with large replacement and repair costs.
- Lock all doors and windows. For shops and businesses, put grills down and see that stock and tools are stored away and out of sight. Any window, door or vent is a potential access point for a thief. When you make your site visits, check every entrance to make sure that it is secured. Lock windows and board up large vents from the inside to make sure that no unwelcome visitors can access your premises. You could also secure and seal any openings designated for letters, as these can be used to access the building using specially designed tools. Physical barriers to entry are the most effective deterrent, immediately making a property far more difficult to enter.
- Empty bins and see that any combustible material – paper, packaging, rubbish – is either stored away or removed from the premises. Any waste left inside or outside your business can be a fire hazard. Make sure that all waste is cleared away and disposed of properly so that you are reducing the risk to your business. Bins should also be stored securely inside so that potential thieves cannot use them to reach upper areas or to access your premises forcefully.
- Inspect your premises inside and out regularly – most insurers expect this type of inspection to take place once a week. Obviously, only do this if it’s safe and you can maintain social distancing. Keep a record of each visit, e.g., the time, date, details of the inspection.Checking on your premises every week, or as specified by your policy, for any signs of damage that could be costly for your business at this time is essential – if you are unable to do this yourself in the current lockdown circumstances, arrange for another responsible and trusted party to do so.Create a checklist ready so that you can remind yourself of everything that you need to check whilst you make a visit to ensure you don’t miss any details that could put your property at risk. Checklists are available so please contact us for a copy. If inspecting your property is not possible, get in touch with us to discuss the circumstances and find out more specific information about how this will affect your insurance.
If you are in any doubt about any of the information above, then please contact us at email@example.com, or give us a call on 01342 580106.