Unoccupied property: Landlord Insurance and Tips

Unoccupied property: Landlord Insurance and Tips

29 April 2020 by Pinewood Properties

The restrictions enforced due to Covid-19 has had a major impact on us all. This may have an increased impact on property owners, with some facing a prolonged period where some of their property may sit vacant.

It is important during this period to check the terms of your insurance policy and in particular, any unoccupancy conditions to ensure you and you are familiar with any guidelines or terms.

Advice from Gallagher is to check with your insurer if you have any questions on their current stance related to unoccupancy limits (typically 30, 45, 60 days and may have been extended due to Covid-19).

Here are some best practice pieces of advice that should be considered:

1. Notify your Broker and Insurer
Firstly, it is vital that your insurer is informed that your property is now vacant or not being used due to the restrictions. As obvious as it may seem, almost all insurers see this as a material change in risk, and therefore have a requirement to be notified, and so that they can respond with any additional measures they would like to see implemented.

2. Secure your Premises
Unoccupied premises are significantly more vulnerable to unwelcome intruders such as squatters and various other groups of trespassers. Intruders lead to a greater risk of a huge number of perils, including fire, flood, theft and malicious damage.

Undertaking a thorough physical examination of all potential entry points to your property, as well as all perimeter fencing, and ensuring it is all suitably secured, is vital to minimising this risk.

3. Revise your checks and procedures
Whilst these will vary, it may be a good idea to appoint an individual to be responsible for the premises, with a clearly outlined set of duties, is critical to risk mitigation.

This role could come with any number of responsibilities, including internal and external site inspections with a supporting written and photographic log, testing of any critical systems, reporting any issues through a clearly defined reporting process and generally ensuring the site appears cared for rather than vacant.

Storm, flood, utility leaks or fire damage can be costly even if a property is occupied, the risk and damage may increase further if a property is vacant.

*4. Consider your Legal Liability***
Property owners have a legal duty of care to third parties whilst on their premises, and this even extends to trespassers – which could include children using your site as an unofficial playground. Undertaking a review of your health and safety risk assessment at the earliest opportunity is vital to take into consideration the fact that your property is now unoccupied.

5. Prevent Fly-Tipping
Unoccupied premises are often targeted by opportunistic fly tippers where they have easy access, in order to dispose of waste on a significant scale. There are a number of measures you can take to deter this behaviour, including ensuring gates and perimeters are secured, block unnecessary vehicle entrances and install where possible security lighting.

Please note that these tips are intended to provide useful high-level guidance. As previously stated, policy wording conditions relating to unoccupied property may differ so it is vital these words are reviewed and understood.