URGENT!!!!! VACANT PROPERTIES

The news is filled with stories about the unfortunate reality of vacant properties.

Homes and businesses alike are standing empty. Many owners may have purchased homeowners/dwelling or business insurance policies while the homes or businesses were occupied and now that there is a vacancy may have incorrectly assumed they are secure with that coverage in place.

Vacant or unoccupied property presents special challenges. The premium charged for occupied property does not take into consideration the increased exposure of vacant and/or unoccupied property. The insurance provided by most policies is limited, and may not respond at all if the property has been vacant for more than 60 consecutive days (prior to a loss)!

Many if not most insurance companies will cancel coverage immediately if they become aware of the vacancy. Even if the policy is not canceled there may be major problems in the event of a loss. The occupancy status is considered essential (material) to the insurance company. When the use and/or occupancy of a property changes many insurance companies no longer want to insure the property.

Of major importance:

• Insurance is suspended on glass (window/block) breakage
• Vandalism and theft is not covered
• There is no coverage for freezing of a plumbing, heating, air conditioning, or automatic fire protection sprinkler system or of a household appliance caused by freezing if a structure has insufficient heat, and/or the water system has not been shut off and drained
• On a commercial building…if there is 31% or less occupancy in addition to the above, ALL claims are reduced by 15%....(unless a vacancy permit endorsement attaches the policy).

Depending on the policy and insurance company involved the entire policy may be void in the event of a vacancy or unoccupancy. There are, however, solutions. We  pride ourselves on finding solutions for our clients. We must, however, be first made aware of the vacancy or occupancy. Please contact us if your property undergoes an occupancy change and we will help guide you through the necessary steps to obtain proper coverage.