A lot of people are currently trying to understand what their insurance covers them for and what additional actions, if any, they need to take. A key consideration should be ensuring you continue to comply with any policy conditions as failure to comply could invalidate your insurance and result in non-payment of a claim.
Each insurer has different policy conditions and so if you have any concerns please do get in touch with us to discuss the specifics of your policy but the below is intended to provide some guidance and highlight common policy conditions that you should be aware of at this time.
One of the most common conditions in building insurance relates to unoccupancy. Insurers tend to deem a building unoccupied if it has been wholly, or mainly unoccupied, or not in active use for thirty consecutive days.
Different insurers specify different time frames and measures that you must take to comply with the condition. You should contact us once your property becomes unoccupied, and we will advise accordingly in regard to the condition. A number of our insurers are beginning to provide leniency with these conditions, and specific advice from each insurer can be found here. But please speak to us if you require further clarification.
As a guide, the most common measures that you must follow are:
• Inspect the building internally and externally at least once every seven days, with a written record of the inspections maintained
• Secure the building appropriately, and put all protective locking and alarm devices into operation
• Make sure that there is no accumulation of waste in or around the property
• Make sure that gas and electricity supplies are turned off at the mains (except electricity needed to maintain any fire or intruder alarm systems)
• Make sure that all water supplies including sprinkler systems are drained and isolated from the mains
There is a vast amount of guidance online to help you manage vacant property and we have highlighted some of these for you:
Aviva – Guidance on protecting unoccupied property
Aviva – Fire safety inspections guide and checklist
Fire Protection Association – Security and arson protection advice for building and business owners
Aviva – Guide on control and management of combustible waste and checklist
HSE – Legionella and landlords’ responsibilities
Property - change of use
Insurers must be made aware of any change of use to your property. Failure to do so could lead to a potential claim being invalidated, so if there is any doubts please get in touch.
Legal Expenses policies by their nature apply stringent conditions which must be followed, particularly in regard to potential employment disputes.
This may relate to changes in employee terms of engagement, undertaking of a disciplinary procedure, employee dismissal, redundancy consultation or dealing with grievances.
Where a circumstance arises which has the potential to result in a claim, suitable legal advice should be followed before any action is taken and often insurers say this is advice must be from their appointed helpline. You can find the helpline details in your policy documents.
If you are unclear of the procedures to follow with your Legal Expenses insurer please contact us before taking any action.
Directors & Officers Liability & Legal Expenses considerations
A common exclusion within Directors & Officers policies relates to an increase in certain shareholdings, and claims being brought by one of those parties. If shareholding increases beyond a significant percentage, policies can even be placed into run-off automatically, only providing cover for previous activities.
Insurers must also be made aware if a business is likely to post a balance sheet showing a negative net worth position, in addition to changes to employment contracts.
It is therefore essential that we’re made aware of any of these changes, so we can advise your insurers accordingly.
Outstanding risk improvements
Where you have recently had a risk survey completed as part of your insurance programme, your insurer may have stipulated specific requirements that must be completed within a certain time frame.
Some insurers have applied leniency to these requirements, however not all insurers currently share this stance. Therefore it is essential that any outstanding requirements are discussed (we will most likely be in contact if not already, but don’t hesitate to get in touch) in order to reach a realistic and fair conclusion for all.
Most items of plant and machinery require inspecting within a certain time frame, subject to Lifting Operations and Lifting Equipment Regulations (LOLER) and Provision and Use of Work Equipment Regulations (PUWER).
If, as a result of government restrictions you are not able to have such plant and machinery inspected, it is imperative that you stop using these items until an inspection can be conducted.
Contract works - cessation of works
Most construction policies will have a specific clause written in called “Cessation of Works Clause”. This clause stipulates that you must inform your insurer if work ceases for a set period of time, usually 30 to 60 days. Please get in touch with us if this is the case.
Early notification of claims
Insurers ordinarily stipulate that you must advise as soon as reasonably practical of a potential claim. This continues to apply throughout Covid-19, and late notifications can allow insurers to avoid a claim.
Therefore, it is imperative that if you are considering a claim (either as a result of Covid-19 or not), please get in touch with us as soon as possible.
Motor – hire & reward
Insurers have generally provided leniency to the use of vehicles throughout Covid-19, however it’s important to consider if your vehicle is being used for hire or reward purposes, such as paid work to deliver food.
Ordinarily hire or reward purposes aren’t covered by your motor insurance, so it is important that this is clarified with insurers if such activity is taking place.
A general insurance condition is that you must take all reasonable care to minimise the potential of a claim, whether it be property or liability related.
If Covid-19 or subsequent government restrictions compromise you being able to do so, please get in touch with us to discuss further.