Let’s consider the benefits of Commercial Property Owners Policy & some points to consider:
• Property Owners Liability is included under this policy as standard. The limit can be increased from the standard £2m up to £5m, for an additional premium. This cover is essential if someone becomes injured through a fall in or around your premises. The person may require support as a result of those injuries or may have had some loss of earnings due to their inability to work, hypothetically. If those injuries are deemed a result of the Property Owner’s Negligence, the you may have to foot the bill. This is where it is important your are insured adequately.
• Trace & Access – Some insurers may cap this cover up to £5,000 or £10,000. Some insurers, will have no cap. This cover is essential should you have a sub-floor leak & cover the cost of tracing the leak – think of ripping up floor to get to the source & the extra cost this would incur. Note, trace & access is only payable when there is valid claim or leak. It cost of which can’t be reclaimed if a floor is ripped up to find there is no leak!
• Standard Perils can include cover for Fire, Lightning, Earthquake, Aircraft, Explosion, Theft, Malicious Damage, Storm, Flood, Riot, Civil Commotion, Escape of Water, Impact (by falling trees, vehicles or animals, Subsidence, Landslip or Heave. The Standard Perils on a policy can vary slightly, and therefore, we recommend you add Full Accidental Damage if it is non-standard on a policy. This will mean you are insured for insurers determine is a sudden or unforeseen event.
• Electrical Fire cover is a standard cover on your policy, although you mist ensure your property is well maintained in this regard, meaning there is an up to date Electrical Certificate in place. You may also be required to have a Fire Alarm in place, depending on the type of use of the building. For example, a Commercial Property housing a Restaurant would be expected to have a fire alarm in place. Without this some insurers will not provide cover for Fire.
• Index Linking – What does this mean? When insuring your building, you need to correctly insure the about it would take to reinstate the building in the case of a total loss. This not only includes the costs of Bricks & Mortar, but also Professional Fees, such as architectural or legal costs and site clearance costs for example.
Once this is calculated, your insurer will cover this amount, and increase the amount by an amount determined by RICS the following year (at renewal) to consider any inflationary increases. This is called Index Linking, and is designed to ensure you do not gradually become Under-insured. Crucially, the figure needs to be correct from inception of the first policy – indexation will not work if the sums were incorrect or too low to begin. We recommend an RCA and can help you with this via our partner at heavily discounted rates.
All Electrical Inspections must be in perfect working order and be checked by a professional. This will allow for an Electrical Certificate to be produced, which will confirm the date of the next inspection, which is normally every 3 years.
Failure to have a current Electrical Certificate in place will result in Fire being excluded.
It is also important to have fully serviced and maintained Fire Alarm System in place – failure to comply with such a condition can also exclude fire cover at your business.
