Arranging insurance for an unoccupied building can be quite a headache as you may find, most of the major insurers and national banks are not interested if your property is likely to be empty for a few weeks or more, and when you do find a company that will cover it, the policy can be extremely basic or they want payment up front, or it just seems very expensive.
Unoccupied property insurance is something of a specialist area, and is very different from your home and contents insurance. A home is rarely used for anything more than an occupied private residence. This risk is very well understood and doesn’t tend to vary much. With empty property insurance things are very different. Covers can be quite wide ranging depending on what you are intending to do with the property.
Cover
Many empty property insurance policies are just FLEA cover or FLEE or FLEEA. This means cover is limited to purely Fire, Lightning, Earthquake, and/or Explosion or Aircraft Sometimes property owner’s liability is included in this but not always. This is the most elementary type of buildings cover there is. If any building works are going on at the property, it’s likely that you will only be offered this.
The more specialist companies will offer not only FLEA cover but higher levels of cover too, and some even offer cover similar to a household buildings policy, provided there are no major works in progress.
With such a difference in covers offered for unoccupied properties, it is imperative that the policy is read to make sure cover you expect is included. As an example, some of the higher levels of cover may look similar to a household insurance policy, but they may exclude theft, where others will include it.
Policy Terms
Most empty properties are only empty because they are between uses, e.g. a landlord is looking for a new tenant, or the property is up for sale. Due to this, most unoccupied buildings owners are only wanting short term cover, and in the example of a property for sale, this could literally be no more than a few days. Naturally, insurance companies are rather reticent about providing such short term cover, so they often charge high cancellation fees, or they will specify in their policy wordings a minimum policy term of 6 months, meaning they will keep at least half of any premium should you cancel early.
However, there are better options available. Some companies offer short term unoccupied insurance policies for 3, 6 or 9 months, though there would be no refunds if you cancel one of these policies early. You may find these policies, although cheaper overall, are more expensive on a month to month price, compared with an annual policy.
There are some rare exceptions, who will accept payment by monthly instalments over 10 or 12 months, although you may have to search hard to find one of these. There is a broker, Quote-4.me.uk, who offer plenty of useful advice, and policies such as these on an interest free basis, and this seems to be the most prudent way to go for insurance for unoccupied property.
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