Farming Talk: Insurance risk in keeping a place empty

With the current economic climate there has been a rise of commercial premises on rural estates being left vacant for considerable periods of time, so having the correct insurance policy in place to cover every eventuality is all the more important.

Burst pipes and vandalism are just two of the incidents that could leave owners unable to make a claim, as insurers look to restrict risk by not providing full 'all risks' cover, unless specifically requested by farmers and landlords.

Landowners also need to be aware that if previously occupied buildings are empty for more than 30 days, some policies will have restricted buildings insurance. Restrictions can often be for claims that are made for an escape of water such as burst pipes, malicious damage or theft.

Workshops and offices on rural estates can often remain empty for some time until a new tenant is found, so any restrictions are risking a valuable asset.

Many landowners may not realise that it is a condition of their buildings insurance policy to notify the insurer if the building is, or is likely to be, vacant for a certain period of time (policies often state that any period of more than 30 days should be declared).

There may still be more conditions that lead to restrictions, so it is important that landowners contact their broker or insurance company directly.

Extra conditions we've come across are a requirement to inspect the property internally and externally every seven days, all electricity supplies to be switched off and that the building is maintained in good structural condition.

David Surtees-Dawson is associate director at Savills Telford.