More Than Three In Four Professional Investment Properties Are Uninsured

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Commercial property owners are putting their investments at risk from under-insurance by failing to maintain their sum insured at adequate levels, according to Aviva.

The insurer says the sum insured by the property owner should be the amount it would cost to completely rebuild the property and should include the costs of removing debris as well as architects' and surveyors' fees, as well as any contents that may be lost should the worst happen to the property.

Mark Dunham, commercial property underwriting manager at Aviva, says: "We have seen an increase in the number of properties that are underinsured during the recession but when money is tight and people need to reduce costs it's important that this is not at the expense of their insurance cover."

Insurance is peace of mind should the worst happen and having accurate sums insured on a property is paramount. The last thing you want to discover after catastrophe befalls your property is that your sum insured is inadequate – it is vital to guarantee receiving the full amount in the event of a claim.

Dunham says: "If the sum insured is too low, the policy may not provide enough money to rebuild the property. In the current economic climate, it could prove very difficult and costly to borrow the money you need to cover the shortfall thus putting the finances of the business under increased pressure."

You need to be sure that the insurance covering your property investment is complete and robust. Talk to a buy to let professional about your policy and exactly what it needs to include. Paying a little now makes sure you pay out even less should the worst happen.

SOURCE: Aviva, 26/03/10

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