Property Insurance Broker: Is your property unoccupied? Do you know what cover you have?
If you need unoccupied property insurance before the policy starts
If you do not have a tenant or you are not occupying the property yourself when you are in talks about taking out a new policy, you may find that a lot of insurers refuse to quote. Some will want details on how long you’ve been marketing the property for tenants and/or how much longer you anticipate it being empty for.
If you need unoccupied property insurance during the policy period
If your tenant(s) move out during the policy period or the property becomes unoccupied for any other reason, you must notify your insurer or property insurance broker immediately. Some insurers will allow a short period of unoccupancy but again will want details of your intentions and efforts to have the property occupied again.
Check what cover you are getting
Many insurers restrict their cover during periods of unoccupancy to only a handful of events such as damage caused by Fire, Lightening, Earthquake etc. There are many other causes of damage that would normally be covered but get excluded whilst the property is empty. Some insurers will give you full cover for the first 30 days, for example.
Watch out for the small print on your insurance policy
Many property insurance policies have some small print that list a number of things you must do if the property becomes unoccupied (either immediately or after a period of time), such as board up windows and letter boxes, drain the water system, or maintain a minimum temperature. These are just a few examples but there can often be 6, 7 or more things the insurer will be checking for if presented with a claim on the policy. Some of these requirements may be simply not possible, but you would need to have negotiated this before you purchased the policy, ideally through a property insurance broker.
If your property is long term unoccupied
If your property is unoccupied for a longer period or indefinitely, your insurer may be inclined to cancel the policy and possibly refund you for the remainder of the year. However, you will need to look at getting a specific unoccupied property insurance policy. There aren’t many insurers out there that offer these but a decent property insurance broker will be able to access them for you. There are some unoccupied property insurance policies out there that give almost as much covers as when the property is occupied.