Insuring Commercial Heritage Buildings
Do you own a period, listed or unusual property that's been converted for commercial rental? Beware of insuring it on a standard insurance policy - you could be selling yourself short.
The "heritage" part of your property portfolio shouldn't be underestimated: heritage buildings project credibility and contribute to the trust customers have in the commercial enterprises that operate from them. This is why they're so attractive for commercial tenants. If your property lost its "heritage" factor, how would this impact on your business? From country houses to village pubs, theatres, museums and offices - thousands of heritage properties are in individual private ownership, and thousands of businesses are run from them. But a standard insurance policy may not pay for reinstatement after a major loss - you could be left with a very different property and business proposition:
A beautiful eighteenth-century Grade II Essex barn used as a restaurant may lose its attraction to diners if replaced by red bricks and off-the-shelf fittings. Though the food may be fantastic, the ambience is gone!
Properties of this type and aesthetic value need insurance policies that offer wider protection and cater for the pitfalls that can occur during the reinstatement process:
- Restoration: restoring a heritage building after a loss is a long, slow and costly process, sometimes involving specialist building consents with restrictions on building materials and methods. The extra time taken to restore a heritage building means associated business interruption in terms of loss of rent.
- Under- and over-insurance: it's important to get specialist advice when deciding the sum to be insured on a heritage building - you need to allow for the cost of reinstating the entire structure. Sometimes, a partial loss is even more difficult to restore, and if the building is listed, the law may stipulate the methods and materials used. You could also end up paying too much if your valuation is done by an inexperienced advisor.
Seek specialist advice: through Period Property's insurance scheme with inet3, you have access to a team with all the expertise to understand the complex and specific exposures faced by heritage properties. We can tailor both cover and premium to reflect your activities.