Vacant properties can attract vandals and may become a magnet for trash and crime. Maintenance issues also are a challenge when no one’s around to notice if a sprinkler starts leaking or a pipe bursts.
That’s why most commercial property policies limit coverage if a building is vacant for more than 60 days. After that, your building typically loses coverage for vandalism, broken glass, water damage, and theft. Even coverage for other losses, like fire or wind damage, may be reduced.
Take steps to protect your vacant property
Vacancy is defined as 31 percent occupancy or less for most commercial policies. If your building falls below that threshold, talk to your agent. If your policy has a vacancy clause, ask about a vacancy permit to fill in some of those coverage gaps.
Next, take action to reduce your chance of loss:
- Notify local authorities (police, fire) that your building is vacant.
- Talk with nearby owners and ask them to notify you if they see anything unexpected.
- Keep all sprinkler, fire detection, and security alarms active.
- Maintain an indoor temperature of 55 degrees to keep the pipes from freezing.
- Turn off any utilities (gas or water) that aren’t needed for heat or safety.
- Maintain the exterior (cut grass, remove snow) so the building appears occupied.
- Consider hiring a patrol service or security guard.
- Conduct frequent walk-throughs, at least two or three times a week.
Protect vacant homes
Just like commercial properties, vacant homes are an “attractive nuisance” and are susceptible to unique risk. Talk to your agent to find out if your carrier offers a vacant home endorsement. If not, you may need to purchase a separate vacant home policy.