Commercial Property

Your responsibilities when closing a property up or leaving it closed for an extended period

by mjdhughes
It isn’t just during a pandemic that property gets closed up and not used. If you’re a tenant that decides it is no longer to operate a viable business from a property where you have a lease, it may be the better option to lock the doors. If you’re a landlord you may have a period where your property is not occupied and you don’t have a tenant. In each case there is a person who is responsible for the property.

It is therefore worthwhile to protect your interests before avoidable costs head your way through break-in, storm damage, or flood, fire and lack of repair. As well as practical security measures, it is very important that you inform your insurer if your premises are going to be empty for any extended period of time. In particular if the property will be empty for more than 30 days. If this is the case damage may not be covered.

We’ll take a look at what is needed by property sector

Unoccupied office space

Common Insurance Precautions
Make sure the property itself is in a good condition before securing the premises. Complete a schedule of condition with photographs. This will help demonstrate to the insurer that you are mitigating the risk.

Drain down water that may freeze in pipes if closing the property up for the winter, or if you close up the property in the spring make a not to check the water before winter comes along if the closure is longer than originally envisaged. Keeping the heating on will help prevent burst pipes and will also help prevent damage to the wallpaper or building’s structure. By doing this preparatory work demonstrates to your insurer that you are helping to prevent a claim from arising.

Electrical wiring must be maintained regularly. Unchecked, faulty wiring can cause fires. At the very least ensure you:

  • Unplug appliances
  • Replace damaged cords
  • Book regular checks from a certified electrician

It is important to visit unoccupied property regularly and to make a note of your inspections. Keep ahead of potential claims before they arise.

Locks

Deter intruders by securely and visibly bolting down all windows, doors and garages. Who could have access to the closed property? Make sure all keys are accounted for and make a note to confirm this has been done. If in doubt, change the locks. Board up main windows to protect your property from damage and unlawful entry. Timber can be used for this but for a more secure result professional steel shutter can be used.

CCTV

Catching a break-in on camera will be helpful supporting evidence for making a claim. Cameras can also act as a visual deterrent for potential thieves, squatters or vandals.

Alarm Systems

A suitable alarm system is a priority. The alarm system should be installed and maintained by a recognised installer approved by the National Security Inspectorate or the Security Systems and Alarms Inspection Board. The alarm should also be recognised by the Police.

Check with your insurer that your alarm system is recognised by them.

Abandoned commercial premises

Maintaining Property Presentability

A property that looks like it is closed, unoccupied and never visited will stick out and become a potential target for thieves, vandals and intruders. Keep it clean and maintain the property. This will also make it more attractive to potential leaseholders. Concentrate on the easy wins such as…

  • Clearing out any overgrown weeds and grass
  • Emptying of any Oil Tanks
  • Regularly collecting post
  • Pick up any litter
  • Remove any potential hazards that could cause harm to passers-by
  • Keep a good relationship with neighbours, they can be your eyes and ears and contact you if anything happens to the property

If you need any assistance with closing a property up for an extended period, or someone to manage the above process while the property is closed please call us or email at info@mjdhughes.com

Business

Insurance Checklist – Do you have everything covered?

by mjdhughes

PXL Insurance are brokers for commercial property insurance. Here they advise one what you need to have covered in your insurance policy

Cover the assets, earnings and legal liabilities of your business to ensure you have protection against:

  • Building insurance
  • Tenants Improvements (if you are a tenant but have made improvements to the property at your own cost that you couldn’t take with you if you moved out i.e. decoration, flooring, partition walls, sanitary fixtures and fittings etc )
  • Trade Contents Fixtures and Fittings
  • Coverage for loss of drinks licence
  • Home contents if you live on the premises
  • Business Interruption to protect your income after an incident that results in a successful claim. You should request a level of cover that is more than your Gross Profit
  • Public Liability for injury or damage to the public
  • Products Liability to cover against causing illness from food or drink
  • Employers Liability to cover any employees injuries, including damages, legal costs, and expenses

Some of the likely Conditions and Policy Warranties you should be aware of:

  • Employers Reference Number (ERN). All insurers now request your ERN where Employers Liability cover has been provided. This is to help identify the relevant insurer should a claim come in down the line. If you do not know your ERN your accountant should be able to provide it for you.
  • Electrical Certificate. It is very likely any insurer will expect that an Electrical Inspection of the fixed wiring has been carried out within the past 5 years by an accredited Electrician i.e. NICEIC or NAPIT.
  • Flat Roof Warranty. If your property has any section of flat roof you should roughly work out the percentage of the flat roof and notify your insurer. This will likely result in a Flat Roof Warranty being added which will require you to have the flat roof and gutters checked every 2 years by a professional and a record kept, if there are any defects found they should be rectified immediately.
  • Kitchen Ducting and Extraction Systems. If you do any cooking at the premises most Insurers will require you to have all your extraction systems and ducting to be professionally cleaned on an annual basis, this prevents a build-up of grease in areas your normal cleaning regime cannot reach. If a fire breaks out in these areas they are very difficult to contain, and the cleaning drastically reduces the chances of this happening.
  • Deep Fat Fryers must be thermostatically controlled and manned at all times.
  • Local Hygiene Rating / Scores on the Doors. More and more insurers will now only offer cover if a score of 2 or above has been awarded.
  • Health & Safety policy. If you have 5 or more employees this is mandatory.
  • Minimum Security. It is likely that any insurer will have a minimum security requirement, this is normally a 5 Lever Mortice Deadlock on any external doors (Fire Exits are exempt) and key operated window locks on any accessible windows.
  • Duty of disclosure. It is your responsibility to disclose all the information requested by your insurer and anything you believe may influence their decision to insure you. If you disclose everything and adhere to the warranties / conditions you shouldn’t have any issues in the event of a claim.
  • Things like previous claims, adverse financial history i.e. CCJ’s, Bankruptcies, Liquidations and Convictions can have a big impact on an insurers decision to provide cover, this applies to all partners, directors or significant persons involved in the running of the business. If an undisclosed detail is found during a claims process, its possible your policy could be voided from inception, meaning not only would the claim not be paid, but it could make it very difficult for you to obtain insurance in the future. If in any doubt discuss it with your broker.

PXL Insurance offer a range of insurance options to fit your business needs. Contact David Hawkesworth at dhawksworth@pxlassociates.co.uk