What factors affect my unoccupied property insurance … and other FAQs

Posted: 20th May 2019

For any property owner who needs to leave their home, buy to let or commercial property empty for more than a month or so, unoccupied property insurance is imperative.

Here are some of the most frequently asked questions we receive on the subject of unoccupied property insurance here at Cover4LetProperty – which you might want to read in conjunction with our comprehensive Guide to Unoccupied Property.

For easy viewing, you might even want to watch our video on the subject of whether you are likely to need a specialist unoccupied property insurance policy.

What is unoccupied property?

As with many other terms in common usage, insurers have a particular definition of what it means for a building to be “unoccupied”.

Typically, if the premises have not been continuously lived in or occupied while in use for 30 to 45 consecutive days, it is considered to be unoccupied. The exact period may vary from one insurer to another, but one thing is certain: no matter what your property is like, you may easily cross the line from having a property that has been vacant for a couple of weeks, to having one that has become “unoccupied” in the eyes of an insurer.

So, one day your current policy may be adequate, but the next you may have to switch to unoccupied property insurance. This can apply to both landlords and owner-occupiers.

How do properties become “unoccupied”?

A property may be considered by an insurer to be unoccupied if:

  • it has been let to someone, but they give notice and leave. It can be difficult to re-let properties in a short space of time. Once the property has been empty for 30-45 consecutive days or more, with most insurers it is classified as being “unoccupied”;
  • the property may be a probate property. Sometimes, after you lose a loved one, it can take a while for probate to be sorted out. And when probate has finally been granted, it may take even longer for the property in question to be sold. In these circumstances, it is easy to see how 30 days or more may elapse, and therefore how the property can become “unoccupied” for the purposes of insurance;
  • you have to work away from home for longer than a month or are taking an extended holiday; and
  • when refurbishments take longer than expected. Unfortunately, building, decorating, plumbing and electrical works are prone to overrun. So, if you have left your property vacant while major works are going on, you may wish to keep an eye on the calendar to avoid becoming suddenly in need of unoccupied property insurance in a hurry. Depending on the work being carried out, you may renovations insurance.

Why is the definition of unoccupied so important to insurers?

Insurers attach such great importance to knowing when a property is unoccupied since it is considered to be more vulnerable when it is empty and at greater risk of loss or damage.

The risk of loss or damage is key to insurers’ decision-making, of course, so the increased risk inherent in an unoccupied property is a major concern to insurers – as it is also to the property owner, of course.

Why do unoccupied properties present more risks?

With a bit of luck, your unoccupied property may be no more likely to befall a disaster than it would be when let or lived in by yourself. In that case, you may wonder whether you have to bother with getting unoccupied property insurance – or in fact any empty property insurance at all.

But insurers may perceive vacant properties as being at a greater risk of damage simply because there is no one there to notice and act upon the kinds of perils that are insurable.

So, if there is a fire or a flood at the property, the mere fact that there is not a tenant or owner on hand to get out the fire extinguisher or sandbags may mean that the risk of damage may be higher.

And empty properties may attract the unwanted attention of thieves, intruders, squatters and even arsonists.

Do I have to have unoccupied property insurance?

In case you were wondering why you cannot just plod on with your current regular property insurance, you may wish to check the terms and conditions of your policy. If you do not have unoccupied property insurance, you may find that the insurer may not pay out if something were to happen on the grounds that the existing policy would be void if the property were unoccupied.

You should also note that if you have a mortgage on the property, in most cases it will be a condition of your mortgage agreement that adequate buildings insurance is maintained at all times.

How much does unoccupied property insurance cost?

The price of any kind of insurance you buy is always likely to be an important consideration.

But, as with all financial products, one man’s cheap insurance may be another man’s “basic”, and different property owners may undoubtedly be looking for different things for their money.

The key thing about any kind of insurance policy may be to find one that suits your own individual requirements at a price that meets your expectations.

The trouble with empty properties is that property owners rarely intend for them to be that way. Yet if you own a flat or a house, you may easily find that it has remained unoccupied for at least 30-45 days – at which point it typically becomes “unoccupied” for the purposes of insurance.

Your empty property insurance options may include just the very basic of cover – covering risks such as fire, lightning, explosion and aircraft (often known as FLEA cover) or you may wish for more comprehensive cover that provides the same level of protection as your existing property insurance.

Cover4LetProperty offer online quotations for your unoccupied property with insurance companies with whom we have arranged exclusive schemes.

In addition, we have ensured that our policies offer you a range of benefits depending upon the level of cover you are looking for.

Please free to obtain an online quote or contact us on 01702 606301 for further information. We’d love to help!