A staggering 80% of commercial properties are at risk due to underinsurance. According to a leading building surveyor, owners of commercial property are putting their assets at risk, estimating 80% of commercial property is underinsured by between 20% and 45%.
Akim Kamangira, Head of Building Consultancy at Birmingham independent commercial property agency KWB, spoke of the risks associated with underinsured commercial property:
“When buildings are under insured, insurance companies will only pay out on a pro-rata basis. This means if they are under insured by 45%, then any claim will be reduced by the same amount. This will leave landlords straddling to make up the shortfall to repair or rebuild a devalued asset,” said Kamangira.
An independent study commissioned by the British Insurance Brokers’ Association (BIBA), revealed that millions of SMEs in the UK are failing to adequately protect themselves and their employees from events such as fires, floods and terrorism.
In light of the research, BIBA launched a campaign designed to encourage SMEs to take business continuity seriously by ensuring they are protected in the event of an emergency.
Additional research shows that 80% of businesses affected by a major incident close down with 18 months.
Given the often-irreversible damage incurred by a major incident that puts a business’s assets such as commercial property at risk, it is vital commercial premises are fully insured to cover landlords and businesses against potentially damaging events.