All landlords will have empty properties at some point that might need to be protected with specialised unoccupied property insurance.
Standard landlords’ insurance policies do not automatically include this cover so it needs to be arranged separately.
From being in between tenants to carrying out extensive maintenance work, there are many reasons why residential or commercial premises in your portfolio could be unused for some time.
If you anticipate having some empty properties in the near future, it’s important to check that you’re fully insured.
Here’s a guide to unravel when and why landlords need to add unoccupied property cover to an insurance policy.
30 day rule
Because vacant houses, flats and commercial premises are considered to be much more vulnerable than occupied ones, most insurance companies will not cover properties that are empty for more than 30 days.
So if a property is only going to be empty for a couple of days or a few weeks, there won’t be any need to arrange extra insurance.
However, properties vacant for longer than 30 days must be covered.
Vandalism and other crime
Empty properties are much more likely to be vandalised. From graffiti and smashed windows to structural damage caused by squatters, any repair costs won’t be covered by your landlords’ buildings insurance if the incident occurred after the standard 30-day threshold.
Similarly, if your property is fully-furnished or has expensive equipment lying around that’s stolen during a burglary you won’t be reimbursed for the contents and the costs of rectifying any damage caused.
Burglars are renowned for targeting empty properties so it makes sense to do everything in your power to keep buildings secure and prepare for the possibility of becoming a victim of crime by organising any additional insurance requirements in good time.
Your property or properties will require a certain amount of regular maintenance. While small works that are carried out when tenants are in the property are covered by the buildings insurance element of your standard landlords policy, more extensive repairs on an empty property that take months won’t be.
Situations like this need to be covered by unoccupied property insurance.
If you’re planning to renovate or extend one of your buildings, this type of work will undoubtedly take longer than 30 days.
Another situation where extensive building work on an empty property is necessary is if freak weather such as flooding or high winds results in serious damage leading to tenants having to vacate a home or business premises for their own safety.
Flood damage in particular can take many months to remedy. Even when the repair work is finished, drying out a property is a time-consuming ongoing process.
Other insurance add-ons for empty properties
Another consideration as a landlord is the loss of income incurred from empty properties. It’s all very well making sure that you’re adequately covered to deal with any costs relating to building repairs, but when your properties are unoccupied you’ll also be losing a significant amount of potential rent income.
The Insurance Octopus provides an insurance add-on that covers any loss of income suffered during those periods when you’re unable to rent out a flat, house or commercial site.
When it comes to unexpected events, it pays to be fully insured. Being prepared with a quality bespoke business insurance plan ensures you’re ready to deal with any unfortunate situations that arise. This kind of peace of mind is priceless when trying to run a successful property business.
Get in touch with The Insurance Octopus today for further information or a no-obligation quote on landlord insurance policies tailored to your individual needs.