Your property insurance, which most of us consider to be a combination of buildings and contents cover, is perhaps at the heart of your comfort zone about how well protected your investment in bricks and mortar is.
Yet did you know that if you leave your property unoccupied for a period, that insurance may become null and void?
Unoccupied versus empty
Before explaining the nature of the potential problem and what you can do about it, it’s worth being clear on terminology.
Property insurance companies are typically very careful about their use of words. So, when they say ‘unoccupied’ they don’t mean ‘empty’. The risk to your continuity of cover arises in situations where nobody is resident in your property – not simply if it is empty of furniture and furnishings.
Why the problem might arise
Statistically, properties are at greater risk when they’re unoccupied.
Thieves and vandals are usually far more attracted to properties where the owners or residents are away than those with people in them. As most of them also try to avoid any risk of being disturbed, they’re particularly fond of homes, houses and offices, which show signs of being unoccupied over a longer period of time.
Property insurers understand that a house might be left without occupants during the working day, when you’re away on a long weekend or during the annual holidays etc. Their policies will make an allowance for the increased risks in such situations and the policyholder has nothing to worry about in those routine circumstances.
However, the typical standard household insurance policy won’t cover situations where your property is left unoccupied for longer periods of time such as:
- extended holidays or business trips;
- if your property is undergoing repairs or renovations;
- you are between tenants (landlords only).
If you look carefully at your property cover policy, you’ll see that it will typically specify a maximum permissible unoccupied period. That’s often somewhere around 30-45 consecutive days.
If you exceed that maximum, your existing policy (buildings and contents) may become invalid in full or part.
The solution to this gap in cover is called unoccupied property insurance.
It is usually easily put into place through a call to your insurance provider or you can look for a specialist provider of property cover who also offers unoccupied property insurance.
Is it essential?
As is the case with most forms of cover, this type of policy isn’t a legal requirement as such.
It is though very much a case of common sense. Even if you’re, for example, delayed overseas on a business trip, you may wish to consider making urgent arrangements. If not, you may be effectively without protection until you return home again.
Do note also that if you have a mortgage in place on your property, then you’re probably contractually bound under the loan contract to keep full property insurance in place and active at all times. Failing to take out unoccupied property insurance in circumstances where it was required might not only lead to a claim being rejected but also you being found to be in breach of your mortgage terms and conditions.
Finding out more
None of us can be sure when a disaster might strike our property. In 2015 though, around £2.9million was paid out every single day to claimants under property cover protection.
This indicates that problems with property resulting in a claim are commonplace and the sums involved are potentially huge.
If you know your property is going to stand unoccupied for an extended period of time or even suspect that it might, a quick discussion with your insurance provider might be sensible.