Vacant Building Insurance

Vacant Building Insurance Ontario

What You Need to Know About Vacant Building Insurance

If you are a property owner who has a building or two that can sometimes sit unoccupied for extended periods of time, you should consider purchasing vacant building insurance. Whether the building is waiting for new tenants or currently undergoing renovations, because of its vacancy, it is open to increased risk.

Because of the increased risk, you may need more than your regular commercial property insurance policy. That is why it is essential to inform your insurer about your building’s vacancy and ask about purchasing vacant building insurance to protect you and your property from damages, injuries and lawsuits.

Insurance Coverage Options

Even though your property is sitting vacant, it still carries just as many risks as before. You still need to protect it from potential perils, such as fire, water damage, vandalism, injuries and more. A comprehensive insurance policy will help protect building owners from damages or financial losses while the building remains vacant.

At Insurance Hero, our insurance experts know how to ask the right questions to ensure you get the exact coverage your business needs. By partnering with us, we guarantee we will find you high-quality, comprehensive insurance coverage at the best price.

What is vacant building insurance?

Essentially, vacant building insurance is an insurance portfolio tailored to owners of commercial buildings that have less than 31% occupancy. It safeguards the property from everyday risks and perils, such as damages, losses, negligence and injuries. This policy is designed to protect commercial properties, including restaurants, retail, warehouses, strip malls, offices and more.

Is it more expensive to insure a vacant building?

Despite the fact that it needs less insurance, vacant property insurance is generally more expensive. Because the building is sitting empty, it is at a much higher risk of damage, and insurers know this. The cost of vacant home insurance varies depending on several factors, but you can generally expect the cost to be about 50% higher than your regular property insurance.

In order to calculate your insurance premiums, your insurer may ask some of the following:

Property type and size
Any amenities on the property
Whether amenities are hooked up
Vacancy reason
Your coverage limits and terms

What risks does a vacant property face?

With an occupied property, there’s someone on site to contact maintenance if a pipe leaks or bursts. Vandals and robbers are also less likely to break into an occupied building because there is much more of a chance of being caught.

But with a vacant property, it can sometimes be left for days or months without anyone checking in on it, which gives ample opportunity to vandals, robbers, a water pipe burst or bug and animal infestations to cause significant damage. Vacant properties are also at an increased risk of severe fire damage because there is no one to call the fire department until it’s spread enough that someone outside notices it.

What is covered by vacant property insurance?

Standard vacant building insurance starts with commercial property insurance and commercial general liability insurance. We also recommend including equipment breakdown insurance and builder’s risk insurance. Here is a breakdown of how they can protect your building:

Commercial Property Insurance

This coverage protects your building and the contents inside by covering your financial loss from such perils as:

Property damage due to natural disasters, flood, fire, vandalism or theft.
Property damage or theft of electronics, equipment, furniture or company documents that are still inside the building.

Commercial property insurance can also include business interruption, which protects your business should you be unable to work due to an illness or injury and have to shut it down temporarily. This helps offset ongoing costs from income losses, such as bills, employee wages, etc.

Commercial General Liability Insurance

This insurance policy protects your business from legal liability against third-party bodily injury or property damage claims that occurred on the property. It covers the costs of medical bills, legal fees, and repairs or replacements. For example, if someone on your property slipped and injured themselves, your general liability would cover any legal fees and associated medical bills. This insurance policy also protects you should the above occur on your company’s premises or any advertising and reputational injuries (e.g., slander, libel, copyright infringement).

Equipment Breakdown Insurance

Equipment breakdown insurance covers financial costs for equipment that need repairs or to be replaced due to internal damage, such as power surges, motor burnout, electrical shorts, operator errors and mechanical breakdowns. It’s recommended to have this coverage if you are storing any valuable equipment at the vacant property.

Builder’s Risk Insurance

This insurance policy safeguards your building and liability in the event of costly claims while undergoing construction or renovations. Builder’s risk insurance covers the building, on-site materials and liability claims throughout the duration of the project. Also known as construction liability insurance or course of construction insurance, contractors often require the client to purchase this policy as they are the property’s owner.

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Rest easy knowing that your building is protected, no matter what unexpected situation life tosses your way. Let Insurance Hero help manage your risk and insurance costs by conducting a full commercial insurance policy review to determine what kind of coverage is best for you!

For reliable, affordable Ontario welders insurance, please request a quote online or give us a call at 1-855-777-4376. Our team of Insurance Heroes is happy to answer any questions you have!