Consider some of the reasons why you might be leaving your residential, buy to let or commercial building as empty property for a while – there are quite a few of them:
- your job may have taken you away from home, or even overseas, for a while;
- you have been lucky enough to take a round the world cruise or to visit faraway friends and relations for an extended holiday;
- you might be taking a sabbatical from your usual, full-time job;
- you might have the builders in to refurbish, extend or generally decorate your home and have moved out for the duration;
- you might be moving house, have already moved into your new home and are waiting for the previous one to be sold;
- as a buy to let landlord, or landlord of commercial property, you may be waiting for new tenants to move in following the end of a previous tenancy or lease; or
- you might have an interest in a property which is subject to probate, pending decisions on its ultimate ownership and fate.
When a property is left unoccupied, it is exposed to qualitatively different risks to those when it is in more or less constant use or habitation:
- even relatively minor repairs and maintenance may develop into major disasters if left unattended because there is no one to hand to take prompt action;
- the major threat, however, is that posed by fire (accidental or arson), squatting, theft and vandalism.
British Institute of Facilities Management (BIFM), for example, cites estimates that some £2 billion worth of damage is caused through vandalism and arson each year and that roughly one quarter of those incidents have occurred in empty or vacant property. According to statistics published by the Association of British Insurers (ABI) of the £12.9 million property claims handled each day, 18% of them are related to fire damage.
BIFM also refers to estimates that there are currently more than 22,000 squatters in empty property, compared to just 9,500 in 1995. Although squatting and trespass are criminal offences, the owner of an empty property still owes a duty of care to prevent injury to such individuals. It cites a particular example where an injured trespasser was awarded more than half a million pounds in damages.
The insurers’ response
Understandably perhaps, insurers therefore regard an empty and unoccupied property as a considerably greater risk than one which is in use. So great a risk, in fact, that after 30 or 45 consecutive days (depending on the particular insurer) insurance cover become severely restricted or lapses altogether.
In order to make good that deficiency, purpose designed, specialist unoccupied property insurance is available from niche insurance providers such as ourselves to ensure that the building and its contents remain fully protected even when it has been left vacant for longer than a month or so. You can find out more by reading our Guide to unoccupied property here.
It is generally possible to tailor the level of cover provided to suit your particular needs and to arrange cover for the estimated duration of any vacancy – you might want cover only for six months, for example, rather than the entire year. If your plans change, unoccupied property insurance is typically flexible enough to allow for extensions to the term of the policy.