AXA Commercial Customers – Unnocupancy in COVID 19 Times

On Monday 4 January 2021, the UK Government announced a further National lockdown in England, commencing immediately for an unspecified time period, which sits alongside similar further tightening of rules and regulations in Wales, Scotland and Northern Ireland.

We therefore feel it’s important to remind our customers of the impact this situation has on property insurances and of the support and guidance we can offer in the management of unoccupied buildings.

AXA have stated:

All of our customers who have a property insurance element to their policy have a minimum 30-day definition of unoccupancy/empty (some customers may have longer periods specified in their policy, in which case the longer period applies).

If a building is unoccupied for longer than 30 days (or longer if specified) we ask that our customers notify AXA as soon as practically possible via their normal contact point.

This is potentially a greater issue than under previous

lockdowns due to:

the mixture of the original national lockdowns,

regional / local lockdowns and the English UK

tiered system mean that many (if not most) affected

businesses will have already been closed and

therefore have either reached the 30 day limit or will

be approaching it.

the move into the coldest part of the year when

“freezes” and bad weather significantly increase the

risk of damage to property.

In normal circumstances AXA would charge additional

premiums as well as restricting or limiting cover to

reflect the increased risk of unoccupied buildings,

but during this challenging time we are committed to

supporting our customers where we can. Consequently,

we are renewing our commitment not to charge any customer additional premium due to a building being unoccupied solely as a result of Government lockdown

or furloughing of staff due to Covid-19.

In addition, we will not normally restrict the perils

insured or increase the excess unless there are

specific concerns regarding the risk in question, the

previous loss experience or the ability to comply with

standard risk management precautions. Similarly, we

will only specify additional security requirements in

exceptional circumstances where there are specific

risk-based concerns.

Upon notification to us our local teams will advise what

requirements should be put in place to protect the

unoccupied building(s). This will generally be as follows:

1. The building should be inspected internally and

externally at least once per week.

2. That refuse, waste and any mail is regularly removed

from the building.

3. The building is fully secured using all protective

locking devices available, setting any alarms and

activating any CCTV available.

4. Ensure that gas and electricity supplies are turned off at the mains – except any electricity required to

maintain essential building services, alarms or to run

computer servers etc. whilst working from home.

5. Any empty building or empty part of the building has

its water supply isolated at the mains. For extended

empty periods that water and heating systems are

fully drained-down – this is particularly important

for protection of our customers buildings during this

time of year

If for any reason — such as ‘shielding’ — the customer

is not able to comply with the above requirements in

person please advise us and we will recommend third party contractors who will be able to assist, or we may be able to propose alternative solutions.

These five key risk management requirements are

fundamental for the preservation of property during

this challenging period. If a customer can’t meet these

requirements in full please advise your local AXA

contact immediately and we will discuss potential

alternative solutions.

Please note that these benefits only apply to buildings

which are unoccupied due to Government lockdown.

Buildings which are long-term unoccupied, where a

tenancy has ended, or the occupier has formally

ceased trading, will be subject to our standard

underwriting approach.

We appreciate that the current situation can be

confusing for customers with so many full, partial

and regional lockdowns so we would like to make

the following clarifications:

If a building is occupied/trading for at least

seven consecutive working days a fresh 30-day

unoccupancy waiver period is provided.

Customers do not need to notify us that the

building is unoccupied until the 30 days is exceeded.

If a building was unoccupied prior to the

announcement on 4 January, the 30-day

period starts from the date the building

became unoccupied and not the 4 January.

If a building is partially occupied, such as a

restaurant undertaking take-away business or

a retailer undertaking click and collect business,

we do not regard it as unoccupied and there is no

need to notify AXA.

Larger buildings which are partially occupied

are not regarded as unoccupied, provided that

approximately 50% of the floor space is occupied

(e.g. at least three floors of a six-storey building).

Please do contact us if you are unsure of any matter by visiting www.arcbrokerservices.co.uk