Introduction
Unoccupied properties are an inevitable feature of the property market. Evidence shows that the prospect of damage or injury arising from unoccupied property is high, even if only temporarily vacant for example prior to sale or refurbishment.
Hazards
Each year there are around 9,000 fires in empty buildings. Other common problems include theft of contents or fixtures, vandalism, fly tipping and occupation by squatters. Empty buildings are also at risk of water damage due to inadequate maintenance or repairs, especially when coupled with infrequent site visits.
Insurance for unoccupied properties
Accordingly unoccupied properties are not an attractive proposition to insurers. When insurers do cover unoccupied property they will usually wish to limit cover to basic fire, lightning, aircraft and explosion risks only. Although insurers may be persuaded on a case-by-case basis to provide additional covers such as vehicle impact, riot and civil commotion, and malicious damage, the effect will be that in many cases the “wet perils” of storm, flood, burst pipes or escape of water will be excluded.
Other insurance company requirements
In addition to limiting the scope of cover they provide, insurers usually apply special unoccupancy conditions which may include some or all of the following:
– Regular inspection of the premises. The requirement is most commonly for an internal and external logged inspection twice per week. However terms vary and must be understood
– Clearance of all removable combustible waste
– Turning off the gas, electricity and water supplies at the mains and/or draining of the water systems. This condition is usually modified where it is beneficial to the property owner and insurer to maintain the electricity supply to support fire and/or intruder alarm systems or in respect of utilities which support heating or sprinkler systems
– Securing of accessible windows, other openings and letter boxes to help prevent unauthorised entry. This list is not definitive or exhaustive and conditions will vary on an individual basis.
Key actions for owners of unoccupied properties
– Review your arrangements for security, fire and Health & Safety to minimise the risks (owners have a legal “duty of care” to third parties such as authorised people entering the premises, whether they are employees, estate agents, surveyors, buyers etc as well as trespassers – including children who may simply use the area as an unofficial playground)
– Ensure that you fully understand the scope of insurance cover you have and are aware of any exclusions
– Comply with any insurance requirements/conditions
– Appoint someone to be responsible for the premises
– Consider security in terms of fire and intruder alarms, manned guarding and CCTV
– Take away all contents, rubbish and combustible material, from both inside and outside the premises. Purge all fuel tanks
– Stop unwanted posted mail items Check areas that contractors have been working in at the end of each day and when work is complete
– Ensure that keys, when issued, are recorded and controlled
– Ensure the property displays a “cared for” appearance
– Notify the police and fire brigade and provide key holder contact details
If property owners are in any doubt as to the extent of cover in force or available when insuring unoccupied properties they should always contact their Horner Blakey Insurance Brokers representative for clarification and without delay. Further sources of information Arson Prevention Bureau: www.arsonpreventionbureau.org.uk Fire Protection Association: www.thefpa.co.uk
