When flats becoming unoccupied
Flats will become empty for a whole variety of reasons. A flat might have been leaseholder owned for example and is then sold to a new leaseholder. Not everything goes smoothly, so there may well be a period of unoccupancy. Tenants on a 6 months tenancy agreement (AST) may move on. There are of course many reasons. The important thing here is to tell your insurer. Every insurer is different, so their rules and conditions will vary to a degree – one common rule between them all, however, is to tell them of any changes to the occupancy or risk (as they like to call it).
Some insurers will simply note the change and keep cover as it is, except possibly excluding burst pipes cover to the empty flat. Some insurers may provide cover for some certain limited perils only, such as Fire, Lightning, Earthquake or explosion for example. A different insurer may state limited perils cover will apply to the whole building (if there are a majority of empty flats). All policies are different and failing to tell your insurer, then you run the risk of being unaware of the cover or conditions – this can cause serious problems should you be unfortunate enough to have to make a claim.
Work taking place at the premises
Work taking place at the premises often go hand in hand with flats becoming unoccupied. Obviously, we are talking about extensive work, such as extensions and renovations which can affect your block building insurance policy in several ways.
Some insurer will have restrictions on the amount and type of work you carry out on buildings. Normally there will be a limit on the amount carried out or a limit on the costs of works exceeding the cost of the existing structure. To avoid you breaking the terms of the policy, it’s best to check in with your insurer before any work goes ahead. Your insurer will want to know some of the following to begin with:
- Has planning permission been applied for
- Has planning permission been approved
- The cost of the works
- The scope of the works
- Is there JCT cover required
When there are works taking place at the premises, you will find that insurers apply what is called a ‘Contractors Exclusion’ or ‘Contractor’s Endorsement’. What this essentially does, is ensure that if any damage is carried out by the builder that the block building insurance policy provider is not responsible for making good any damage they have caused. This responsibility will fall on your Contractor’s Insurance Policy – so make sure they have a valid policy in place and ask to see it before they start. Any reputable contractor should not think twice about allowing you to see it.
What to take away from this
When you take a block building insurance policy, you will have received what is known as a Statement of Fact or Proposal form. This lists the questions the insurers have made and your answers to them. Read the small print, as it will also state that any change to the risk should occur during the life of the policy must also be declared to the insurer. This document will place any responsibility on the insured (that’s you), to tell them if there are any changes to the risk information noted on the document or any information that you feel is important for the insurer to know. This document will be referred to and relied upon heavily by the insurer in the event of any possible claim. When you inform the insurer of any change to the risk, you will be issued with amended Statement of Fact.
If you wish to discuss Block Building Insurance, or buildings which are part/completely empty or undergoing works then talk to one of our experienced and qualified brokers.