Commercial Property Insurance

Commercial property insurance, also known as commercial landlord insurance, is designed to offer specialist protection for landlords letting out buildings to third parties for commercial use.

Some businesses own and occupy their buildings. In these circumstances we can provide a standalone buildings insurance policy to protect you for loss or damage claims due to fire and a range of specified insurance perils such as storm, flood, impact, escape of water, malicious damage, explosion, accidental damage and subsidence.

Alternatively, we can include your buildings insurance under a Commercial Combined policy along with loss or damage to your other property such as computers, machinery, plant, fixtures and fittings, all other contents and stock. The policy is flexible and can additionally include loss of income (business interruption insurance), Money, property owners, public and employers’ liability. A great solution for a business as it’s a combination of separate policy types, all arranged together under a single policy with one renewal date and an annual premium.

This depends if you are the owner or a tenant. Commercial building insurance is not a legal necessity but without it you will have to pay for any damage the property suffers due to fire storm or flood. You will also be liable for any third-party compensation claims related to property damage or injury through negligence. Tenants need to ensure they have appropriate cover, and also check their lease agreement for any mandatory insurance requirements.

If you employ any staff, it is a legal requirement to have employers’ liability insurance. This can be added to your policy.

In the event of a severe fire loss (or other insured peril) your property would not be fit for occupation, and you may suffer a loss of rental income until the property has been fully repaired. The length of time it will take to repair your building will vary from customer to customer.

All buildings are different - and you must take into account the location, age, type and construction of the property. Specialist properties, grade 1 and 2, can take longer to build due to the building materials and specialist building skills required. It is best to be cautious and consider a minimum of 24 months or longer, as there is always the chance of unexpected and unforeseen difficulties causing delay.

Yes. we are able to cover properties that become unoccupied for up to 30 days on a standard package for fire, lightning, explosion and aircraft. This period may be extended with full details and referral to insurers.
We can arrange cover for properties that are unoccupied for periods longer than 30 days with some of our specialist insurers.

Yes, we are able to offer cover for Grade 1 and 2 listed buildings in England and Wales and the equivalent categories in Scotland. Contact us for full details.

It depends; if buildings cover is included under your policy, then the structure of the building as a whole would be insured including the structure of the flat. With buildings cover this would include property owner’s liability, so slips and trips related to the building as a whole can be covered. It is down to the tenant of the flat above to arrange cover for their own home contents.

The premiums are generally refunded on a pro-rata basis. Therefore, if you have paid in full for the year then you would be entitled to a return of premium (minus commission and fee). Likewise, if you are paying by direct debit there will either be an outstanding balance to pay or a return due back to you, depending on where your payments fall in the month. Most insurers are unlikely to allow a refund where a claim(s) have been made in the current year.

Your buildings sum insured should represent the current rebuilding value of the property following a total loss, including labour and material and the costs of debris removal, architects' and surveyors fees and other professional costs.

You can contact the Royal Institute of Chartered Surveyors (RICS) for independent professional advice. As the costs of labour and materials can change we recommend you have a professional rebuild valuation survey conducted regularly – at least every three years.

Commercial insurance works slightly differently to an individual’s personal insurance policy. Please be aware there is not a cooling off period in commercial insurance. Any cancellation rights will be detailed in the Cancellation condition of the policy.

Yes, we give our clients the option of receiving documents by email and/or post. Just let us know when you set up your policy or call us at any time and we will email them to you.

This depends on the policy you have chosen. We act as insurance brokers and have access to a panel of carefully selected insurers and specialist schemes. You may receive quotes from a few different insurers depending on the cover you request as we will seek policies from our panel of insurers. The name of your insurers will be stated in your quotation documents together with the names of those approached.

It varies dependant on each individual risk. On average we can provide a quotation within 20 minutes. For more specialist insurance we generally ask for a couple of hours so that we can go out to the market and find you a range of competitive quotes to choose from.

You can pay in full or by direct debit. Payment in full can be done via BACS transfer or debit or credit card. All major cards are accepted except American Express.

To help you spread the cost of your premiums, we offer a quick and easy direct debit scheme for spreading payment over ten months. Please visit our dedicated Direct Debit page to find out more.

If you would like to know more about our monthly payment option, please visit our dedicated Direct Debit page. 

Commercial property or commercial landlord insurance is protection for property owners who are letting out to 3rd parties for commercial use. Your tenant is the business, organisation or group who has a rental agreement in place legally allowing them to inhabit your property. It is this agreement that defines you as a landlord and which qualifies you for such a policy.

The two main areas that significantly differ from a standard residential let property insurance policy are as follows:

Building types

Wooden barns, steel structures, flat roofs, asbestos etc. Commercial properties are often of a much less standardised construction to domestic properties. They could also have different types of heating systems, more complex electrical systems etc. These factors mean fixing is a more lengthy and expensive process and mean you need a specialised insurance product that can take this into account.

Tenant types

Domestic tenants are not (or at least not supposed to be) for example, using industrial equipment, housing tens or hundreds of employees, dealing in hazardous waste or using commercial chip fryers in their homes. A commercial insurance product will look at the uses of the building and adjust a cover that will match the risk your tenants pose to your building. For an insurer providing a commercial property insurance policy is about understanding the type of building you have and what it will be used for and then assessing the risks and costs involved.

For a commercial property this is often the most misunderstood or overlooked by commercial landlords. Liability insurance for commercial property is to compensate 3rd parties in respect to property damage and injury through negligence. You are liable, and not your tenants in these circumstances because it’s ultimately the landlord’s responsibility to oversee that their property is adequately maintained.

For example, a third-party delivery person takes a fall after tripping on a loose step in the entrance to your building. You could be held liable in a compensation case.

Property owners’ liability limits usually are offered at 1m, 2m, 5m or 10m for commercial properties.

This is one of the most important features of commercial property insurance. It exists to cover the costs for repairing damage or rebuilding. You must be insured for the full cost of what it would be to rebuild your property should it be destroyed. Being under insured (meaning you state the full re-build cost as less than it really is) could be catastrophic should something happen, which would mean you need to claim for the full amount.

Most insurers have a ‘condition of average clause’. This means if you give a sum insured for building/contents which is not enough, they can reduce the claim by the percentage that you’re underinsured. For example - insure for 100K, but should be 200k, and claim for 50k. You could end up being able to claim only for 25k (minus 50% of the difference).

There are various free re-build calculators online that can assist you in working out your re-build cost.

If your property should become uninhabitable from an insurable event such as a fire, the insurance will pay out for the rent you are subsequently unable to collect, meaning you aren’t losing out financially. The indemnity period is the length of time you can claim for ‘loss of rent’ expenses.

12, 24 or 36 months are also commonly available, and it should be seriously considered what is adequate for your building. This is because in a worst case demolition, debris removal, architects and finally rebuilding can take years (You might even need to find a new tenant).

One way to understand the difference between your ‘contents’ and your ‘building’ is to hypothetically turn your property upside down. Anything that is unattached would be classed as contents. This would mean tables and chairs are contents whereas the doors, cupboards and walls come under buildings insurance. Some commercial properties may be rented already equipped for a certain type of business for example a café may have a commercial kitchen already fitted. This would make the contents insurance a vital part of your protection.

As a landlord you are not responsible for accidental damage to your tenant’s belongings. Anything that the tenant owns will be covered under their own business insurance policy.

Not always offered as standard. You must make it clear early on that you want to be covered for accidental damage. Accidental damage is considered damage to property not classed under another insurable peril. E.g. Bursting a pipe when nailing into a wall etc.

It is always advised that you make yourself aware of the accidental damage exclusions of any policy you consider. They are generally in place to protect the insurer from claims that are ‘inevitable’ such as wear and tear. Discussing these and other exclusions will help you understand your side of the insurance agreement such as levels of maintenance (plumbing, tree surgery) and what in turn you can expect your insurer to cover.

This is help with legal fees when taking someone to court for non-payment. Legal cover is not usually found as a standard policy feature but can be requested as an optional add on to your policy. As with all optional extras they are not deemed essential or legal requirements, an adviser can discuss with you the costs and levels you might be interested in.

Tenants are considered to be on your property with the landlord's permission which is why this cover is not a standard requirement but if there was an incident where they expressly caused malicious damage with intent this option will keep you covered for the costs.

Unoccupied properties are much more susceptible to break-ins, petty crime, squatting etc. This being so, insurers generally exclude unoccupied properties from their policies as standard. If the property is temporarily un-occupied during a changeover of tenants or a renovation a certain amount of time (usually around 30 days) is allowed before you should convert your landlord’s insurance to an unoccupied property policy.

In a domestic house, a roof leek is an inconvenience. In a commercial property however this can lead to loss of rent for the landlord and damage to stock and contents belonging to both the tenant and the landlord. Flat roofs are a big concern for insurers for this reason many will include a 'flat roof warranty' clause in the policy. This requires a minimum amount of servicing and state of repair for the sections that are flat. It will state that the roof must be professionally checked, serviced and repaired by the landlord.

Many landlords call us, because they are looking to insure a commercial property that has domestic flats on the top floor. We can provide cover for both uses combined on one policy, making things convenient for you. Simply call one of our advisers who can talk you through the process.

Landlords should make sure that structural improvements such as new kitchens installed by the tenant are added to their business insurance. While they may be part of your building, they are technically owned by the tenant, even though they won’t be taking them with them when they leave. This means while they are still there, they should be responsible for insuring the improvements, and you both benefit from the cover.