Risk insights: Protecting unoccupied properties 

In a time when redundancies and repossessions are widespread, your firm may be forced to manage unoccupied property. The insurance risks and liabilities associated with owning unoccupied property can be extensive, and to ensure you are adequately protected, it is important to know these risks. In addition to purchasing comprehensive insurance cover, there are numerous preventive strategies for maintaining unoccupied properties to reduce risk and liability.

Potential risks 

There are a host of risks and concerns associated with owning unoccupied property. Unoccupied buildings are an obvious target for theft, trespassing and vandalism. For example, the rising cost of copper has given rise to an increase in the theft of copper pipes from unoccupied properties. 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.

In addition, unoccupied properties are susceptible to undetected damages, such as fire, water damage, electrical explosions, wind or hail damage, and mould. Many of these incidents occur in unoccupied buildings due to small, undetected maintenance issues (where someone in an occupied building would have recognised and handled the problem before it caused a larger loss).

In certain facilities, there may also be environmental hazards that the owner needs to consider. Facilities that are used to store chemicals or other pollutants should ensure that such materials are removed or securely stored –the owner may be held liable for any hazardous materials that contaminate groundwater or other nearby natural resources. Also, underground fuel tanks present serious challenges and thus should be frequently and carefully inspected by professionals.

Other ways to mitigate risk

In addition to extending cover, there are some simple steps that owners of unoccupied property can take to limit their risk and liability.

Prevent vandalism – maintain an “occupied” appearance to the property; mow the lawn, have post forwarded or picked up regularly, and install light timers and/or a security system

Limit liability – make sure property is free from significant hazards (broken railings or steps, broken windows, etc) that could cause injuries to anyone on the property –this could include police officers, maintenance workers, fire fighters or even trespassers

Avoid damage – performing regular maintenance on the property can decrease the odds of damage. Make sure the heating system and chimney are cleaned and inspected regularly. Have the plumbing system winterised to prevent frozen pipes. Periodically inspect roof, insulation, attic, basement, gutters and other areas of the house for any necessary repairs, mould, damage or other problems. Consider installing smoke detectors that are tied to a centrally monitored fire alarm system so the fire service will be notified in case of an alarm. Remove all access materials and combustibles from in and around the building.

Insuring residential properties

Most insurance companies include a clause that a home or buildings policy will be void if it is left unoccupied for more than 30 or 60 days (depending on the policy). This leaves the property owner financially vulnerable for all the risks previously noted. However, many insurance companies do offer unoccupied property insurance (also known as unoccupied building insurance or unoccupied dwelling insurance).

Why choose Unoccupied Property insurance?

If a property you are responsible for is left unoccupied for more than 30 days, whether it’s a gap in a tenancy, undergoing a renovation or going through the conveyancing process, it’s likely that your insurance cover may be restricted under a standard home insurance policy. Therefore, it is important to check with your provider to know exactly what you are covered against. Ask questions like, am I covered for theft, vandalism, malicious damage and burst pipes? All of which are common problems and can be extremely costly and inconvenient if you have to pay out of pocket.

At Guardcover, we offer protection against the worst-case scenario of someone finding a way inside your home and causing damage or committing theft. To find out more about Guardcover Unoccupied property insurance click here.