Vacant properties are a liability. They are more vulnerable to vandalism and fire than an occupied property. In fact, according to the National Fire Protection Association, fire in vacant buildings costs $642 million in property damage every year. This shouldn’t be an issue because most of these places have insurance, right? In truth, there are restrictions in commercial property insurance when the building is unoccupied or vacant.
What is vacancy in real estate?
Most coverage forms define vacancy in a uniform manner. A building is considered vacant unless at least 31% of its total square footage is rented to a lessee/sublessee, or used by the building owner for its regular operations.
After 60 consecutive days of vacancy, any damage that occurs due to vandalism, glass breakage, water damage, or theft is not covered by any insurance. Other types or causes of damage, such as fire or wind, only pay out 85% of what would be normally given out by the insurer.
Is there anything that can be done for restrictions to be bypassed?
The first thing you can do is to tell your insurance agent that your building is currently vacant. Your agent will then work with your insurance company to provide you with a vacant property insurance quote. Once you receive that, you can review it and then decide if the insurance is worth it.
An alternative to the above is to add a Vacancy Permit endorsement. This restores coverage for the aforementioned damage possibilities such as vandalism, glass breakage, water damage, theft, and the like. If your insurer has decided to underwrite the exposure, but the dangers exist, then that endorsement is your best bet.
There are many things you can do to lower the cost of your insurance. Primarily, these actions are centered around securing your property by enacting various precautions.
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Install alarms and CCTV
You could have alarms installed that are powered by a main. That way, you don’t have to risk the batteries running out.
Another thing you could do is to add CCTV to your property. This ensures that should anything untoward happen to your property, you will be able to see who or what did it.
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Hire security
Yet another option could be manned guarding. Hiring licensed security guards will help to ensure that no one enters your property without permission.
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Do random visits and add installations to your property
Try to visit your property randomly as well. This will deter anyone trying to use your property for nefarious purposes.
If you are concerned about vandals, try non-setting paint. Paint like this prevents spray paint from sticking too well to any wall. Focus lightning around windows or doorways. That way, it will be easier to catch someone trying to gain entrance.
Make sure to install sturdy locks on your windows and doors. If you don’t plan on anyone using them, consider putting a bar or shutter on potential entrances and exits.
As a last resort, you can also install perimeter fences, but make sure you check with your local planning department before you start building.
Conclusion
Vacant commercial property insurance is hard to get, but not impossible. Beef up the security of your building to keep it in the best possible shape. To find the best deals, look for unoccupied property insurance quotes online from reputable sources and compare them.
In need of a vacant property insurance online quote? Contact Quesurance today! We have served Hopatcong and the surrounding New Jersey communities by protecting the people we work with just like we protect our own family members.
