Unoccupied Commercial Property Insurance
Offices, Shops and Warehouses Left Empty
Unoccupied Commercial Property Insurance
Offices, Shops and Warehouses Left Empty
Get quotes for commercial premises left empty between tenants, during refurbishment or awaiting sale.
Get Unoccupied Commercial Property Quotes
For premises standing empty
Quotes are provided by a panel of FCA authorised providers. Cover is subject to eligibility and underwriting.
Get Property Quotes →How to Compare Unoccupied Commercial Property Insurance
Unoccupied Commercial Property Insurance
Whilst commercial buildings such as a shop, warehouse or office are normally let out, sometimes they can also lie vacant. Buildings, particularly commercial buildings that are left empty, can become targets for local vandals and possible theft. This makes insuring an empty commercial building a higher risk than if the same building were occupied.
As such, a special type of policy has been developed to provide cover for higher risk unoccupied commercial property. If you are letting out residential property to students or lodgers, then you will need landlord insurance, which is different to commercial property insurance.
What Levels of Cover Are There for an Empty Building?
Once a commercial property is empty, insurers tend to offer cover in steps. The more of the risk you want covered, the more conditions you will usually need to meet, such as regular inspections and keeping the building secure.
FLEA Cover
The most basic level: Fire, Lightning, Explosion and Aircraft. It protects against a major loss but leaves out theft, flood and water damage.
Extended Cover
FLEA plus weather related damage such as storm and flood. A step up for buildings that are secure but likely to stay empty for a while.
Wider Cover
Adds risks such as theft, malicious damage and escape of water. Usually the hardest to get, and it normally comes with the strictest conditions.
| Level | Fire, lightning, explosion, aircraft | Storm and flood | Escape of water | Theft and malicious damage |
|---|---|---|---|---|
| FLEA | ✔ | ✗ | ✗ | ✗ |
| Extended | ✔ | ✔ | ✗ | ✗ |
| Wider | ✔ | ✔ | ✔ | ✔ |
A typical example only. What each level includes, and what it is called, varies between insurers, and all cover is subject to eligibility and policy terms.
When Do You Need Vacant Commercial Property Insurance?
Standard commercial insurance policies will include a clause that refers to the insured building being left empty or unoccupied. Most policies will only give a limited period of cover once the building is empty, after which the cover you have may no longer be valid and you will need special cover for the empty property.
Check your existing policy or talk with your broker to establish the exact conditions that apply to you.
What Does Empty Commercial Property Insurance Cover?
Policies vary between insurers, but most will include, or offer as an option, the following cover:
- Fire. Damage to the building caused by fire.
- Flood. Damage caused by flooding.
- Lightning and earthquake. Damage caused by lightning strikes and earth movement.
- Theft and damage. Cover against theft and malicious damage to the property.
- Public liability. With varying limits of liability available.
- Aircraft and falling objects. Damage from aircraft and other objects dropped from above.
Cover levels and options are subject to eligibility and the terms of the individual insurer.
How Is This Different to Unoccupied House Insurance?
Both protect a building while it stands empty, but they are separate policies built around different risks. If the building is residential, this is not the right cover.
| Feature | Unoccupied Home Insurance | Unoccupied Commercial Property Insurance |
|---|---|---|
| Type of building | Houses, flats, second homes and holiday homes | Shops, offices, warehouses, industrial units and mixed-use premises |
| Common reasons it is empty | Probate, a sale, a long stay in hospital or care, or renovation | Between tenants, awaiting sale or redevelopment, or refurbishment |
| Main risks | Escape of water, theft, vandalism and fire | Theft of metals and fittings, malicious damage, arson, squatters and liability claims |
| Liability | Usually part of the home policy | Property owners’ liability is a key part of the cover |
| Security expected | Locks, alarms and a drained water system | Can extend to shutters, boarding, alarm monitoring and lighting |
| Inspections | Regular visits, as set out in the policy | Regular visits with a record kept, as set out in the policy |
| Other things to check | Any conditions set by a mortgage lender | Any lease or freeholder conditions, and your rates position |
A general comparison. Requirements and cover vary between insurers and are subject to eligibility and policy terms.
What Are the Insurance Requirements When a Property Is Unoccupied?
Each provider will have different requirements, but in general you will be expected to take common sense precautions. Your policy wording will set out exactly what applies, and not keeping to it can affect a claim.
- Switch off utilities. Turn off the water, gas and electricity where possible, and drain the water system unless the heating needs to stay on to protect against frost.
- Provide good security. Keep doors, windows, shutters and any gates properly secured, and keep an alarm working if the building has one.
- Make regular visits. Inspect the building as often as your policy asks, and spot and fix minor issues before they become major and costly to repair.
- Keep a record of each visit. Note the date, what you checked and anything you found, and take photos. It is the easiest way to show you met the conditions if you need to claim.
- Clear rubbish and waste. Remove post, packaging and anything that could burn, inside and out, so the building does not attract fly-tipping or arson.
- Tell your insurer about any change. A new tenant, part of the building coming back into use or building work starting all change the risk.
Unoccupied Commercial Property Questions
Usually, yes. An empty building is more likely to be broken into, vandalised or damaged by a leak that nobody spots, so insurers see it as a higher risk than the same building in use.
How much more depends on the property itself, where it is, how well it is secured and how long it is likely to stay empty.
It depends on your policy. Most standard commercial policies have an unoccupancy clause that limits cover once the building has been empty for a set number of days, and that number varies between insurers.
Check your policy wording, or ask your broker, before the building becomes vacant.
Yes. Let your insurer know as soon as you know the date the premises will be vacated. If you do not, and something happens while the building is empty, a claim could be reduced or refused.
In some cases. A tenant whose lease makes them responsible for insuring or repairing the building may need to arrange cover themselves, even though they do not own it.
Check what your lease says, and tell the insurer your exact interest in the property when you ask for a quote.
The main things are the type and size of the building, its rebuild value, its location, the security in place, how long it will be empty, any past claims and any work planned while it is vacant.
The cheapest quote is not always the best one if it leaves out cover you need, so compare what each policy includes as well as the price.
