Newly purchased property; unoccupied insurance required?

**Ricco E** · 10-12-2012 15:41 PM

I'm in the process of buying 3 properties. 2 are tenanted, 1 is vacant.

I'm aware that many insurance companies allow unoccupied periods within the normal scheme of things. These are limited, the one I had on a previous property was 45 consecutive days.

My question: as the property will be vacant from day 1, can I take out a 'normal' landlord's buildings cover; in the hope that I find a tenant within 45 days (quite likely in the current market). Or, do I need to take out an expensive vacant policy for a short term, then a standard policy when someone moves in?

Thanks.

**ashburnham** · 11-12-2012 08:23 AM

I can only speak for the insurers we deal with - and even those are all different, so don't take what I say as how it is across the board. We have two main options available to our customers who have properties initally unoccupied...

The most popular is to take out a "normal" landlords building insurance but as the property is initially unoccupied, the cover is initially restricted. Our insurers range in time limits to get the property occupied (i.e. 30/60/90/etc days) but once occupied, the cover increases to the standard cover. The price you pay at the start is the same as a normal landlords policy as if it were occupied, the only difference is that the cover is initially restricted.

The second option is to take out an "unoccupied" landlords building insurance. These policies offer more cover (i.e. standard not restricted) but are more expensive. Once it becomes occupied it converts to a normal landlords policy which is usually cheaper consequently resulting in a rebate of premium at this stage.

It is of course different when a property becomes unoccupied during an existing insurance policy. Most insurers will allow at least 30 days without cover/premium being affected. Unfortunately when it is unoccupied from inception you do not benefit from this luxury and are usually stuck with one of the two above options.