Building Insurance for Vacant Properties

As a commercial property owner, your primary goal is to protect your investment and ensure that it remains profitable. However, there are times when a property might be vacant due to a variety of reasons—whether it's between tenants, undergoing renovations, or simply not leased. During these periods of vacancy, your property becomes more vulnerable to specific risks, such as vandalism, theft, weather damage, and more. That's where a vacant property insurance policy comes in. Here’s why having a vacant property insurance policy is essential for commercial property owners:
 
Vacant commercial properties are more susceptible to damage than those that are regularly occupied. Without tenants, the property may not be monitored as closely, increasing the risk of undetected issues like water leaks or fire hazards. Furthermore, vandalism may become more common in empty spaces, especially if the property is visible or in an area with a high crime rate. A vacant property insurance policy helps protect against these risks, covering damage that may occur during the vacancy period. This is why vacant property insurance policies might cost more than expected.
 
Even when a property is vacant, the owner can still be held liable if someone is injured on the premises. For example, if a trespasser enters the property and is hurt due to a broken window or unsafe conditions, the property owner could face significant liability claims. A vacant property insurance policy includes liability coverage, which can protect the owner from legal and medical costs associated with such incidents.
 
Last but not least, and probably the most overlooked reason, standard commercial property insurance policies often come with exclusions for vacant buildings, especially if the property has been empty for more than 30 to 60 days. This is because vacant properties are considered a higher risk. A vacant property insurance policy is specifically tailored to address these unique risks, offering more comprehensive coverage for issues that standard policies may not. It is extremely important to ask your agent about this exclusion.
 
A vacant property insurance policy is a critical part of a commercial property owner's risk management strategy. Whether you’re dealing with a temporary vacancy or an extended period of inactivity, this specialized insurance ensures that your investment remains protected from the unique risks associated with an empty building. From property damage and liability to lost income and compliance with contracts, vacant property insurance offers invaluable peace of mind and financial security. It’s a small investment that can save you from large, unexpected costs down the line. If you have any questions about vacant property insurance or any other Business Insurance, please feel free to contact me. 

Jason Matison
Commercial Insurance Agent
Austin, Texas