Do I Need Coverage for Vacant Buildings?

Posted on June 7, 2018

A Commercial General Liability (CGL) policy for Vacant Building coverage is going to respond to claims resulting in bodily injury. So you may be wondering, “Why do I need insurance if the building is vacant?” The building may be empty most of the time but building owners may have buyers or appraisers coming on the premises to look at the property. Without the proper insurance, the building owner’s assets could be at risk should someone become injured.

You could also find yourself on the receiving end of a claim should a trespasser, such as a curious young child, becomes injured, or worse yet killed, in your building. Don’t wait until something happens to determine if proper coverage is in place. Speak with your insurance agent today!

Frequently Asked Questions about CGL Coverage for Vacant Buildings:

  • Is the building still considered “vacant” if construction begins, gutting it to rehabilitate it for future use?
    No. Once a building owner decides to rehabilitate a vacant building, make sure a “Builder’s Risk” insurance policy is in force as soon as construction begins on the building. This coverage is often required by local municipalities in order to begin work.
  • What kind of coverage do I have if my building catches fire?
    CGL policies for Vacant Buildings respond to claims relating to bodily injury. If the injury or death is related to a fire the policy may respond; however the policy will not cover damage to property. A building owner will need to purchase a property policy.
  • What about mold, toxic chemicals, or other pollutants?
    Typically any kind of mold, fungi, and pollutant is excluded on CGL policies. To mitigate the risk of property damage and health concerns for future inhabitants, make sure the premises is visited regularly by the owner or a hired property management company to catch these types of damages before they become big issues.
  • How can I reduce my risk of a claim?
    Keeping the exterior of the building clear of dangerous objects and in good repair, providing security (alarm systems, guards, and/or CCTV) on the premises and inside the building, maintaining the interior of the structure to catch damage, and ensuring fire detection devices are working and linked to a monitoring service can help mitigate your risk of damage to your property as well as reduce your risk of a claim.

The information available in this article is for informational purposes only, and does not constitute legal advice or confirmation of coverage.