Vacant Premises Implications for Business Insurance Policies during Covid-19.
As brokers, we deal with multiple insurers and multiple policy wordings.
Therefore by necessity this summary is broad, and deals with the overarching issue but may not be the exact scenario for your business. If you are in doubt or concerned about your policy and coverage please contact us.
COVID-19 raises questions for SME customers
COVID-19 raises questions for SME customers (those with turnovers less than $10 million and with less than 20 employees; less than 100 employees if manufacturing) who hold business insurance and which have vacated their premises due to government-required lockdown. In this instance, we are addressing SME business packs, but similar conditions will also apply to Industrial Special Risk packages for larger businesses.
A common requirement of business insurance is that the premises being insured is occupied. This is due to the increased risk of trespass or malicious damage, and accidental damage that may go unnoticed before it causes significant harm.
Damage from a burst pipe for example, could be relatively minor if the incident happened whilst there was an occupant present. Similarly, a fire could be put out before it destroys property. The theft of copper and lead from piping, cabling and roofs is surprisingly common as well. Thieves not only target these areas, they often return for more within a short period of time.
Insurers may refuse to insure unoccupied premises, or if they become unoccupied during the policy period they may impose a higher premium during the time of unoccupancy, or apply a higher excess if there is a claim.
A common condition in business pack insurance is that the premises are not unoccupied for more than 60 – 120 consecutive days (varying depending on the individual policy).
Multiple insurers have contacted brokers to confirm that full cover will be held for small businesses which are required to vacate their premise during the COVID-19 lockdown. Until further notice this is generally up to June 30.
This means that there will be no additional premium loading or imposed excess to be applied to unoccupied premises during this period. Similar concessions have been announced by some Industrial Special Risk providers (generally larger than 10m turnover).
Note there are, as to be expected, conditions such as maintaining essential services, intention to re-occupy when restrictions are lifted, and good housekeeping maintained particularly in regards to hazardous materials.
Regular inspection of the property provided this does not contravene restrictions is also advantageous. If mail cannot be collected, arrangements should be made to redirect it.
Whilst it is unlikely that insurers will deny claims during this period, we strongly advise you to notify us if you have vacated your premises so that we can put the insurer on notice and ensure there is continuity of cover for you. Andrew and Monique Logan
As confusion continues over the COVID-19 pandemic and what is covered,
Logans offer complimentary cover reviews for new and existing clients.
Logan Insurance | Client Stories
We have created short videos to introduce our client stories
Betta Home Living
On New Years eve 2020, Betta Home Living in Bateman’s Bay was totally destroyed by bush fire.
Adequate property insurance meant our clients could be swiftly compensated for the loss.
Bitton was founded in Alexandria, Sydney in 2000. Since then, David and wife Sohani have launched a product range of the same name, a small business consultancy, Bitton Consulting and a second café,
Bitton Oatley. A third café is opening in Rose Bay in Jan 2020.
BOOB LOOB is one of our newest clients. Their product encourages women to perform breast checks that are easy and effortless. Boob Loob is designed for women to put their mind at ease without changing their daily routine. Proudly made in Australia and every bottle purchased online means $1 dollar donated to the McGrath Foundation.
At Logans we provide cover for businesses of all types.
While they are all different in their insurance needs, Betta Home Living, Bitton and Boob Loob
all have extensive cover placed through Logan Insurance Brokers. Cover for these clients includes Public Liability, Business Interruption, Transit, Product Liability,
Theft, Fire, Machinery Breakdown and Food Spoilage.
Our clients have saved $100’s a year by combining and customising their business cover.
Our business is to know your business. Logans will always provide options for the best available cover for your business. That way disappointment is avoided when it comes to making a claim.
If you would like to see how Logans can help your business, please use the link below.
A good insurance broker will ask relevant questions and seek to keep up to date on your business needs. They will also keep up their education in new products and cover in the market, ensuring you have the broadest choices available to you.