There are a host of risks and concerns associated with owning or managing vacant property. Vacant buildings are an obvious target for theft, trespassing and vandalism. In addition to any loss or property damage that may occur, keep in mind that the owner of a property can be held liable for criminal activities or accidents that take place on the premises.
Here are ways to mitigate and take action to address those risks:
Vacant properties are susceptible to undetected damages, such as fire, water damage, electrical explosions, wind or hail damage and mould. Many of these incidents occur in vacant buildings due to small, undetected maintenance issues (where someone in an occupied building would have recognized and handled the problem before it caused a larger loss).
In certain facilities, there may also be environmental hazards that the owner needs to consider. Facilities that are used to store chemicals or other pollutants should ensure that such materials are removed or securely stored—the owner may be held liable for any hazardous materials that contaminate groundwater or other nearby natural resources. Also, underground fuel tanks present serious challenges and should be frequently and carefully inspected by professionals.
Other Ways to Mitigate Risks:
In addition to extending coverage, there are some simple steps that owners of vacant property can take to limit their risk and liability.
- Prevent vandalism – Notify local authorities of vacated properties so they can watch for criminal behaviour. Maintain an “occupied” appearance to the property—mow the lawn, have mail forwarded or picked up regularly, and install light timers and/or a security system.
- Limit liability – Make sure property is free from significant hazards (broken railings or steps, broken windows, etc.) that could cause injuries to anyone on the property—this could include police officers, maintenance workers, firefighters or even trespassers.
- Avoid damage – Performing regular maintenance on the property can decrease the odds damage. Make sure the heating system and chimney are cleaned and inspected regularly. Have the plumbing system winterized to prevent frozen pipes. Periodically inspect roof, insulation, attic, basement, gutters and other areas of the house for any necessary repairs, mould, damage or other problems. Consider installing smoke detectors that are tied to a centrally monitored fire alarm system so the fire department will be notified in case of an alarm. Remove all access material and combustibles from in and around the building.
Find Out More:
In many cases, insurance companies will require property managers to have certain policies and procedures in place in order to obtain or maintain coverage. Assessing your exposures and taking the appropriate precautions can go a long way toward protecting your business.
This list is not exhaustive of all the risks and exposures property managers may face. Download our “Loss Control Questionnaire: Residential Property Managers” guide for an in-depth list of more ways to minimize gaps in your risk management: