Vacant Property Insurance

Vacant Property Insurance

Leaving your commercial property dormant still carries the same risks. Get a custom vacant property insurance to protect your assets.

Zensurance - Vacant Commercial Property Owner

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Commercial Property

What is vacant property insurance?

Vacant property insurance for small businesses is designed to protect commercial properties such as retail stores, restaurants, warehouses, offices, land, and other business workplaces from financial losses or damages that occur while they are unoccupied or vacant for an extended period.

Any commercial property owner whose building is vacant needs a vacant property insurance policy. That’s because your existing commercial property insurance may exclude coverage for vacant business property, exposing a gap that leaves you at risk. A vacant property policy fills that gap by providing protection from liabilities like if someone is injured on your vacant property and sues you for bodily injury.

There may be several reasons a business or residential property is left vacant, such as:

  • If you have shut down your place of business because of a government-ordered public health mandate and you and your employees are working remotely
  • If you own the commercial or residential property and are selling it
  • If you own the commercial or residential property but it is vacant while you find a tenant for it
  • If you are filing for bankruptcy and the business is closed to the public
  • If there is construction taking place or the property is uninhabitable

Some insurance companies may consider your commercial space as vacant after only four days, others may consider it vacant after 30 days. It’s important to check your policy details to determine the length of time your insurer considers a property to be unoccupied.

A comprehensive vacant property and building policy for businesses may include the following types of coverages:

  • Commercial General Liability (CGL) Insurance: CGL is a type of insurance that protects your property from third-party damage or bodily injury. It is one of the most common coverages small business owners purchase. For instance, if you are sued for bodily injury damages by a third party because of a slip-and-fall accident, CGL may cover the injured person’s medical expenses and your legal fees regardless of the outcome of the lawsuit. Even if you are not sued by someone who gets injured on your property, CGL coverage may cover the injured person’s medical expenses.
  • Commercial Property Insurance: Commercial property insurance is designed to protect your commercial space and its contents from unexpected events such as damage or loss because of fire, windstorms, theft, or vandalism. This type of policy insures your building, its contents and inventory, furniture, and any electronic devices or office equipment on the premises.
  • Equipment Breakdown Insurance: If you have valuable equipment or machinery at your property, it’s worthwhile to protect it from damage or loss. Equipment breakdown insurance, also known as boiler and machinery coverage, is designed to repair or replace your equipment if it malfunctions, or if it is damaged by fire, flood, or severe weather.
  • Builder’s Risk Insurance: If your vacant commercial property is undergoing construction or renovations, you may need to add builder’s risk insurance to your policy, which is also referred to as ‘vacant with renovations’ insurance. It protects you from the start to the end of a construction or renovation project, including coverage for the building, the construction materials and equipment on-site, and any damages which occur during construction such as fire, theft, or vandalism.

The cost of an annual premium for vacant property insurance depends on several factors, such as:

  • The location of your property, its size, and the condition and age of the building or structure
  • How long the property is vacant for or expected to be vacant
  • The reason for the vacancy
  • How long you have owned the vacant commercial or residential property and any other property
  • Previous insurance claims
  • Your annual and projected revenue
  • The types of coverages you choose and the coverage limits of your policy

Speak to a Zensurance licensed broker to determine what risks your vacant property is exposed to and get their insights on the right level of coverage to ensure you’re adequately protected.

The first step to reducing the risks you face is to purchase a vacant property insurance policy. Beyond that, there are preventative measures you can take to protect your property while it is unoccupied, including:

  • Remove all valuable equipment and inventory and store them in a secured location
  • Secure all exterior doorways and windows
  • Hire a contractor to erect temporary fencing around the property
  • Install a 24/7 alarm monitoring system that includes surveillance cameras and fire and flood detectors
  • Shut off water to the building while it is unoccupied
  • Inspect the unoccupied property every 36 to 48 hours and look for damages or things that may require repair. Keep a record of each visit and what actions you took while inspecting the property
  • Hire a security company to monitor and visit the property regularly
  • Install exterior motion sensor lighting and set interior lights on a timer so it appears someone may be inside
  • Ensure you have a snow removal contractor remove snow and ice on the property
  • Inform your insurance broker if the property is vacant or expected to be vacant

Getting insured is quick and easy!

Complete our 5-minute online application for a free vacant property insurance quote.

Common claims scenarios

vacant commercial property vandalized

Problem: Your vacant property is vandalized overnight by unknown persons who inflict considerable damage to the building’s exterior, including smashing windows and spray-painting graffiti on the walls at the entrance.

Outcome: Your vacant commercial property insurance may pay to replace the broken windows and have the graffiti removed by a professional cleaning service.

skateboarder on vacant commercial property

Problem: Youths decide to use the empty parking lot and the metal railing outside the main entrance of your vacant property to skateboard. While attempting to do a trick, a youth crashes and breaks his arm on your property. His parents decide to sue you for third-party bodily injury.

Outcome: Your commercial general liability insurance may pay for the youth’s medical expenses and your legal fees if you must go to court.

vacant commercial building

Problem: While your commercial space is vacant and without a tenant, you decide to hire a contractor to renovate the interior of the building. During the night, burglars break into the building and steal materials and tools the contractors were using to do their work.

Outcome: Your builder’s risk insurance may cover the cost to replace the stolen construction materials and tools.

Frequently asked questions

Is there a difference between a vacant property and unoccupied property?

Insurers consider a business property vacant if it is empty (no furniture or equipment inside) after a predetermined number of days. Typically, an insurer will restrict or deny coverage for a property that is vacant after more than 30 days. An unoccupied property is one insurers will consider habitable and maintained and still has the equipment, merchandise, furniture, and other items inside.

Is there a maximum amount of time a business property that is vacant can be insured?

No. However, the coverage limits of your policy may be restricted to a degree depending on the amount of time the property is unoccupied. Speak to a licensed broker about your property’s specific needs.

What kinds of properties are ineligible for vacant property insurance?

If a commercial property is abandoned or uninhabitable because of an insured loss, it may be difficult to find an insurer willing to issue a vacant property insurance policy for it. Have a conversation with a Zensurance licensed broker and let them advise you on how to obtain a policy to protect your unoccupied property.

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Ready to start? Let’s get a quote!

Getting a custom vacant commercial property insurance policy from Zensurance is straightforward and takes a few minutes to do.

To get a free quote, start filling out our online application. One of our licensed brokers will shop the market for you by accessing our partner network of more than 50 leading Canadian insurance companies to find you the best policy at the lowest price available.