Whether it’s your weekly meeting place or a permanent workspace, the premises from which your charity or business operates is likely to be your most expensive asset. Getting the right building insurance for your needs is therefore crucial if you wish to avoid the potentially catastrophic costs of recovering your property after severe damage.
Here are a few points to help you arrange the right cover.
More than bricks and mortar
The costs of repairing or (in extreme cases) completely rebuilding a property will come to so much more than the materials and manual labour. Your insurance policy should also make allowances for the additional costs of demolition and debris removal, professional fees for architects and solicitors, and potential unexpected expenses such as removing asbestos or updating the building’s infrastructure in bringing it in line with modern regulations. Remember to include all the boundary walls, gates and fences on the property.
Building costs fluctuate over time, so it is wise to get them revalued every three years and adjust the insurance accordingly. Generally speaking, older buildings cost much less to construct than they would today and the insured value should increase each year.
If you hire out your building or any part of it to others, you may wish to add extra insurance to cover any damage caused to the property and its contents as a result of their activities.
Additionally, if your organisation relies on the rent from this arrangement, you should consider the potential loss of income should your property be out of bounds during the reparations. You can protect against this by purchasing cover specifically for loss of revenue or loss of rent receivable.
The show must go on
For many organisations, shutting up shop for several months or more is simply not an option. In the unfortunate event that your premises must completely close during the reparations, you may need to rent a temporary meeting place or larger premises for permanent staff. This additional cost could be covered under the “additional increased cost of working” section of insurance against interrupted business. You will need to estimate how long it would take to rebuild the entire property, giving you a suitable “indemnity period” during which you will receive compensation. This could be 12 to 18 months for simple structures, but up to three years for listed or complicated buildings.
Small print, big consequences
It cannot be repeated often enough how important it is to read the small print in your policy, no matter how onerous the task, as it could affect any claim you may need to make. Check for any exclusions in your policy and find out what excesses you may have to pay, so you can avoid nasty surprises when making a claim.
Ask your insurance advisor to explain their terms and conditions. If you’re worried about missing something, then our insurance experts here at Unity will be happy to review your current building cover and flag up where you might be exposed to losses.
We’re here to help build the best policy to protect your organisation’s most vital assets against the unexpected.