Property owners with vacant premises in their property portfolios should ensure they have the correct level of legal expenses cover in the event of squatters occupying their premises.
Mike Colmans, underwriting manager for Aviva, said: “It is estimated that there could be as many as 20,000 squatters in the UK*. Although squatting is more prevalent in domestic properties, landlords and commercial property owners with empty buildings are equally at risk.
“It is imperative that adequate measures are put in place to prevent squatters from entering and taking ownership, as it can be notoriously difficult to remove squatters.
“We have seen squatters taking over commercial properties, for example, seasonal businesses occupying empty shop units for periods of time. Landlords obtaining interim possession orders (IPO) from the courts to remove squatters can take time as well as being significantly costly. In addition, by the time an IPO has been issued, squatters might have already moved on.
“Brokers should be warning property owners of this increasing problem as well as suggesting appropriate security measures, if these are not already in place. For example, letterboxes should be sealed to prevent mountains of post building up, which is a clear message to passers-by that a property is empty.
“Perimeter fencing should be erected and overall security should be assessed. Property owners should consider hiring security guards, installing extra lighting and generally improving locks, grilles, CCTV and alarms.
“The more obvious measures must not be overlooked such as making sure that all water, gas and electricity supplies are turned off at the mains and, wherever possible, chaining and padlocking isolation valves.
“Regular checks on a property are mandatory, as in the event of a claim, insurers may not payout if it is felt that appropriate measures have not been implemented to secure and protect an empty property.”
Colmans highlights that, in one particular case, the insured purchased a new site for development as a new outlet but before building work could commence, squatters occupied the site. A court order was obtained to remove the squatters, but when they refused to leave, a Warrant of Possession was obtained and a bailiff had to attend the eviction. The legal bill was in excess of £5,500.
In another case, a property was left vacant and the policyholder refused to implement risk management measures suggested by its risk surveyors. Cover was restricted to fire, lighting, explosion and aircraft perils basis. Squatters entered the property to which they were served with a bailiffs notice and moved out. The premises was re-boarded and new padlocks were used. Several days later, the squatters re-entered the property and it is estimated that the damage caused exceeded £30,000.
Aviva offers additional legal protection cover for property owners with empty properties. Cover is available via brokers and includes legal fees up to the value of £500,000.
*: * www.thesite.org/homelawandmoney/home/tenancyrights/squatting
