Insurance for empty properties – avoiding unnecessary risks
If you’re a landlord, one characteristic of your rental property is that it may stand empty for perhaps extended periods of time. In those conditions, it may be very advisable to make sure that your insurance policy also provides insurance for empty properties.
Empty properties – a greater risk
Insurance companies don’t like empty properties. The fact is that when empty, your property is at greater risk of break-ins, mindless vandalism and disasters arising from unnoticed troubles such as leaking pipes etc.
For all these reasons, if your property is periodically unoccupied then there is a greater chance you’ll encounter a problem and subsequently make a claim on your insurance policies.
That’s why some insurance policies may not cover your property for certain categories of risk if it is unoccupied. Checking to make sure that your policy does in fact provide insurance for empty properties might be a sensible precaution to take.
Your property is never unoccupied?
It’s possible that you have been lucky to date but sooner or later your property is going to be empty between lettings. You may also have to keep it unoccupied for a period if you need to make repairs or simply re-decorate. In those circumstances, you may be seriously at risk unless you have appropriate vacant property cover in place.
Other specialised risks
Your property is also a business venture because it generates income for you. If it’s out of action because of a problem, your income will disappear. That may be a major blow if you have a loan outstanding on the property – you’ll presumably want to get it restored and back into action as a fast as possible.
That’s not the time to suddenly start asking questions about what your policy does and does not cover!
In particular, it may be worth checking the position with regard to tenant-related risks as well as whether or not you have insurance for empty properties. These may include:
- ensuring that your tenants are covered against accidents and injuries sustained on your property;
- that you are also covered for general public liability;
- tenants that wilfully damage your property, it’s fixtures and fittings or contents (note that only a selected number of buy to let insurance providers offer malicious damage cover);
- the theft of your contents if the property is furnished.
This is not an exhaustive list and it may be useful to take further advice.
In summary, your property has special risks because it is being used for commercial purposes. Making sure that you have insurance for empty properties and which also covers other rental property risks is good business practice. It may end up saving you considerable amounts of money.