6. camelot 13-uk-event-marsh-vacant property risk 060513

Vacant Property Risk Mitigation

2013

Kumu Kumar CEng MIChemE

Head of Operational Risk

London (Tower Place)

kumu.s.kumar@marsh.com

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Understanding The Risk – Vacant Properties

• Attract unwanted attention

• Can fall into disrepair

• Fire

• Flood

• Theft

• Vandalism

• Squatting

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Implications

• Insurers class as high risk, therefore high premium

• Effective risk mitigation can reduce this hike in premium

• Still have ‘duty of care’ to protect visitors on site, welcome or not

• Effective ‘mothballing’ will allow quick reinstatement

• Well maintained sites are easier to market

• Clients require reassurance

• Good risk management avoids negative publicity

• Values are maintained

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So - what do we do?

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Tell your insurer

• Becoming vacant is a significant change

• This change is a ‘material fact’

• Vacant premises are viewed as ‘high risk’

• Probability of loss increases

• Focussed risk management is required

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Risk Mitigation

• Assess the specific risks

• Evaluate relevancy

• Implement mitigation plans

• Measure effectiveness

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Security

• Ensure the property is secure

• Lock all openings

• Seal all letterboxes

• Account for all keys

• External doors must have BS3621 mortice deadlocks

• Consider boarding up doors and windows

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Prevention & Protection

• Isolate all services where possible

• Drain plumbing

• Leave sprinklers, fire detection, CCTV & intruder alarms in service

• Protect systems remaining live from extreme weather

• Employ water ‘leak detection’ technology

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Eliminate

• Clear all combustible materials internally and externally

• Remove all items considered attractive to thieves

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Guarding

• Review your security arrangements

• Ensure an appropriate level of security is maintained as agreed with your insurer

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Regular Inspection

• Inspect the property daily if possible, or at least weekly

• Inspect all internal and external areas

• Inspect using a specific checklist

• Keep a detailed log of all visits

• Keep a log of all deficiencies

• Rectify all deficiencies promptly

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Summary

• Risk management / new acquisition surveys

• Risk ‘Health Checks’

• Business Resilience

• Corporate Defence (Risk Management)

• Project Review

• Sprinkler design and Request For Tender generation

• Valuation

• Training

…..and if so, please get in touch!

kumu.s.kumar@marsh.com

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