Getting insurance for an empty property can be quite a headache as you may find, a lot of banks and major insurers are not interested if your property has been empty for a few weeks, and when you do find a company that will cover it, the cover often comes up short, or they want all the money up front, or it just seems very expensive.
Unoccupied property insurance is something of a specialist area, and is very different from your home and contents insurance. With a household policy, there’s really only one use that’s covered and that is private residency. This risk is very well understood and doesn’t tend to vary much. With empty property insurance things are very different. Covers can be quite wide ranging depending on what you are intending to do with the property.
Cover
Many empty property insurance policies are just FLEA cover or FLEE or FLEEA. This means cover is limited to purely Fire, Lightning, Earthquake, Explosion and Aircraft or slight variations. Sometimes property owner’s liability is included in this but not always. This is the most basic form of buildings cover there is. If any building works are going on at the property, it’s likely that you will only be offered this.
The more specialist companies will offer not only FLEA cover but higher levels of cover too, and some even offer cover similar to a household buildings policy, provided there are no major works in progress.
With such a difference in covers offer for unoccupied properties, it is very important to read the policy wording to double check what you are or are not covered for. For example, some of the higher levels of cover may look similar to a home insurance policy, but they may exclude theft, where others will include it.
Policy Terms
Most empty properties are only empty because they are between uses, e.g. a landlord is looking for a new tenant, or the property is up for sale. In view of this, most empty property owners are looking for short term cover, and in the example of the property for sale, this could literally be no more than a few days. Naturally, insurance companies are rather reticent about providing such short term cover, so they often have quite high cancellation fees, or they will specify in their policy wordings that will keep a minimum of half the annual premium upon early cancellation.
However, there are better options available. Some companies offer short term unoccupied insurance policies for 3, 6 or 9 months, although there would be no refunds if you cancel one of these policies early. You may find these policies are also more expensive on a month to month price, compared with an annual policy.
Rarely you may even find a company willing to offer an unoccupied insurance policy on direct debit over 10 or 12 months, although you may have to search hard to find one of these, although you could try Quote-4.me.uk, who offer one of these on an interest free basis, and this seems to be the best way to go.