Here are some commonly asked questions on the subject of unoccupied property and what implications it might have for insurance.
When is a property considered to be unoccupied?
The exact definition may vary from one policy to another.
Broadly speaking, within the insurance industry it is interpreted to be the point at which a property without occupants passes the specified maximum number of consecutive days of cover provided, as standard, by a landlords’ insurance policy.
The logic here is that a typical standard policy will cover a property without occupants for up to a specified period of time. That might typically be somewhere in the range of 30-45 days and is intended to cover routine things such as tenant holidays, tenant changeovers and relatively quick redecoration activities etc.
Once that allowance is exceeded, your property will be considered to be formally unoccupied.
As an example, in 2012 approximately 5% of the properties we insure at Cover4LetProperty are classed as unoccupied status.
What do I need to do to maintain insurance protection if my property is unoccupied?
You should get an unoccupied property insurance quote and when you have selected one that is appropriate, take out the cover.
Subject to the policy’s terms and conditions, that will ensure that you have continuity of protection for your property and contents.
Why is this necessary?
It doesn’t matter what type of insurance policy you have, it is written on the basis that the provider has specified cover for a number of risks and risk-related circumstances.
Typically, a property is regarded as being at higher risk when it is unoccupied than in situations where there is an owner-occupier or tenants in residence. So, if the property becomes unoccupied, the risk profile increases and understandably insurance providers need to make sure that you have an appropriate policy in place covering those higher risks.
What happens if I don’t take out this revised form of cover?
Aspects of your insurance protection may simply lapse.
You property’s empty status might easily come to light as part of the routine investigations made by an insurance company in the event you needed to make a claim on your policy. That might lead to your claim being rejected.
It might be a risk that you decide is simply not worth taking.