Who needs insurance for mixed-use commercial properties?

Do you own property that is used partly as commercial premises, but also provides residential accommodation?

There might be many different configurations:

  • the building might have a shop on the street front downstairs, for instance, and a flat or flats above;
  • you might have your own office on the ground floor and live in an apartment upstairs; or
  • you might be the landlord of a pub which has rooms for bed and breakfast guests and your own living quarters above.

There are a number of possible combinations for such mixed-use commercial property. The potential for seizing on opportunities to use such buildings to help solve the nation’s current shortage of housing has not been lost on many interested parties – including MPs and the Federation of Master Builders (FMB), said UK Construction in an article dated the 17th of December 2017.

Mixed commercial and residential building insurance

Just like any other building you own, of course, the property needs to be protected by appropriate insurance.

When the property is in mixed-use – not only as far as the commercial and residential distinctions are concerned but also if you use part of the building yourself and let the remainder to tenants – you might have something of a dilemma in how to insure it. Do you need residential insurance for the living quarters, for example, or commercial insurance for the shop; do you need owner-occupiers insurance for the residence and shop or landlord’s insurance?

The answer, of course, is that you need cover that extends to each of these combinations of risks – and that protection is found in purpose-designed insurance for mixed-use premises.

Cover for multi-use property

Insurance for mixed-use property helps you meet the challenge of ensuring that you have the appropriate type of insurance for the use to which any building is put and the way in which it is occupied. If you have mistakenly arranged residential insurance for premises used for your business, for example, or have standard home owner’s insurance for property you let to tenants, the cover is likely to be declared invalid if you subsequently make a claim.

Mixed commercial and residential building insurance safely negotiates you way around any such problem by providing purpose-designed cover for both parts of your property, including any you are using for yourself (for your business or as your living quarters) or those areas you have let to tenants.

Taking the example of building insurance for a shop and flat, missed-use insurance may provide the cover you need for a whole combination of risks, including:

  • building insurance to protect the structure and fabric of the whole of the property – both its commercial and residential parts;
  • contents insurance for the protection of any possessions you own in either of the parts of the building;
  • property owner’s liability insurance – for indemnity against claims by third parties, neighbours or members of the public injured or suffering damage to their property through some contact with your premises;
  • landlord liability insurance – for indemnity against your liabilities as a landlord, following some injury or property damage suffered by your tenants;
  • compensation for loss of rental income – if an insured event makes any part of the premises unusable by your tenants and you lose the rental income you might otherwise have received; and
  • alternative accommodation – if an insured event, leaves the residential quarters you occupy temporarily unsuitable for your use.

In short, mixed commercial and residential building insurance offers a combination of safeguards in one convenient multi-purpose package, designed to provide the protection you need for your mixed-use property.


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