The continued restrictions that have been put in place to fight the coronavirus have had a drastic impact on UK businesses, particularly within the retail, food and hospitality sectors. This continued closure raised concerns within businesses and insurers due to the number of unoccupied buildings suddenly skyrocketing, without a clear end date in sight. Many small businesses were given the green light to reopen their doors to the public on the 15^th June, despite the way they operate looking very different for the time being. Whether your business reopened on the 15^th June or if you’re having to remain closed until further restrictions are lifted, it’s important to take note of how your unoccupancy cover could be affected if your business premises has previously been out of use.

Over the last few months, many insurers have extended their unoccupancy definitions or have excluded the period of unoccupancy which was directly related to COVID-19 from the agreed term. As the lockdown is gradually being lifted, insurers are now looking to update their approach regarding unoccupancy in reaction to these changes.

Unoccupancy cover for compulsory closure
If your business remains closed due to Government guidance, your unoccupancy cover will likely remain in place pending further reviews. This will apply to hairdressers, gyms, pubs and so on.  However, if you could open from the 15^th but have chosen not to take that step for your own reasons, you will need to confirm how this will affect your cover in accordance with your policy’s terms and conditions.

Leading insurer, AXA’s, latest update states that if a business is not remaining closed under the country’s Health Protection Regulations until 15th July, standard unoccupancy cover terms will apply with effect from Monday 15^th June 2020. This means that if an AXA policyholder chooses to remain closed or opens their doors on that date, their cover will be restricted to standard unoccupancy cover restrictions.

Often, insurers tend to go in a similar direction after one has taken the lead so it may be that other insurers follow a similar trajectory.

It’s important to get in touch with your insurer or broker to understand exactly what you’re covered for.

Protecting your unoccupied premises
When a building is left unoccupied, it is subject to an increased risk of vandalism, theft and water damage, more so than when it is being utilised on a regular basis.

To better protect your premises while it remains unoccupied, ensure that you utilise the security measures you have by ensuring alarms are working and activated and all doors and windows are locked and secured. If you don’t have them in place already, it may be worth investing in CCTV and light sensors to deter and capture criminal activity.

To discuss how your unoccupancy cover were affected from 15^th June, please do get in touch with a member of the team at Lockyers. We’ll review exactly what you’re covered for based on your policy conditions. Just call us on 01924 278222.