Unoccupied Property

January 26th, 2021 Posted by Uncategorised

As the third national lockdown continues, many are still unable to use their business premises. This may mean your business or your tenants have vacated the premises entirely or there is a change to the pattern of occupancy. In the past, the premises may have been occupied daily, whereas now they are only occupied on a limited number of days each week.

This could have implications for your insurance as most property insurance policies only provide cover where the premises are unoccupied for no more than a period of 30 days. Beyond this cover may be reduced or even automatically excluded. These conditions apply to both Building and Contents insurance.

During the first national lockdown, most insurers granted extensions to the 30-day limit, however, insurers’ have since ended these special arrangements. 

Given the current national lockdown, there is some uncertainty as to what stance insurers will take now if properties are vacated or unused or are only partially used.

The one known fact is that insurers must be advised where the occupancy has changed.

What you must tell us now:

If we arrange Business Insurance (Buildings and/or Contents) or Property Insurance for you as a property owner, please contact us if the level of occupancy has changed.

Examples of these changes include:

  • Part occupancy or complete vacancy of the premises during the working week
  • Significant changes to the opening times of business premises
  • Changes to physical, intruder or fire security (perimeter fencing/gates, alarms or CCTV)
  • Weekend occupancy (if not disclosed already)
  • New subletting to a third party
  • Change of tenants
  • In the case of multi-tenure properties, details of any vacant units or properties.

Have you changed your business activities?

You must also inform us if you or your tenants have either changed or diversified your business activities so that we can inform your insurer. This also applies to any business activities that you may have ceased.

What Happens Next

Once you have contacted us, we will notify your insurer of any changes to your property’s occupancy or security. This will mean you are meeting your obligation of ‘disclosure of information that your insurers need to know’. Policy terms may change but we would expect sympathy from insurers where you are meeting this obligation.

Should you wish to discuss this in more detail, please contact your Hamilton Leigh Client Service Executive.

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