AXA update on cover for unoccupied premises due to Covid-19

18 June 2020

As your Network, it’s our job to keep you in the loop with the latest news from our Strategic Insurer Partners. Please see the most recent update from AXA below.

This week we outlined our cover for premises which will be unoccupied after 15 June, due to Covid-19. In certain cases, customers need to take some additional measures to enable us to continue providing cover after this date.

Following feedback that it may be challenging for some customers to fully comply with these by the 15 June, we are extending our implementation period for these changes until midnight on the 26 June. During this period the unoccupancy/empty buildings conditions of our policies will continue not to apply to businesses which have chosen to remain temporarily closed due to Covid-19.

Our updated position is detailed below.  We have also updated our Cover for premises unoccupied after 15 June 2020 due to Covid-19 PDF document, which includes answers to questions we have received.

If you have any further questions regarding the application of our unoccupied/empty buildings conditions, please discuss with your local AXA representative who will be happy to help.

Cover for businesses and premises that continue to be unoccupied after 15 June 2020, due to lockdown, staff furloughing or working from home as a result of Covid-19.

The continued temporary closure of many businesses due to the Covid-19 lockdown has significantly increased the number of unoccupied businesses and buildings. These buildings have a higher risk of damage/loss from various causes, such as water damage, arson and theft, than when occupied.

The standard AXA policies define a building as unoccupied if empty, or not being fully utilised for business purposes, for a period in excess of 30 days (please check your policy wording for full details).

In response to the current situation, we initially supported all existing customers and selected new business customers, who had to close their businesses due to the Covid-19 lockdown, by extending the unoccupancy definition from 30 to 60 days with effect from 16 March when many businesses began to close. As the pandemic continued, we then further extended this definition to cover closure up to and including the 15 June.

As lockdown restrictions begin to ease and economic and social activity increase, we are further updating our approach to the unoccupancy conditions.

Premises that are Compulsorily closed

Firstly, we would like to assure all existing customers (AXA policyholders prior to 16 March 2020) whose businesses remain compulsorily closed due to the lockdown (those who must remain closed under the Health Protection (Coronavirus Restrictions) Regulations as appropriate for England/Scotland/Wales/Northern Ireland), that we will further extend the unoccupancy definition up to and including the 15 July so no compulsory terms apply to these clients.

This benefit will also apply to those new business customers where we have previously confirmed we would extend our normal Unoccupancy terms (this will have been made clear when cover was incepted, however if you are unsure as to whether this applies to your policy your AXA branch will be able to confirm).

Businesses where the insured has chosen not to re-open the premises

For businesses where closure is not mandated, but the business chooses to remain temporarily closed, the normal unoccupancy conditions/Empty Buildings Condition of the policy will apply from 27 June. This requires you to declare to us where a building or premises is unoccupied to enable our underwriters to assess the risk as presented.

For buildings which remain temporarily unoccupied due to working from home or staff furloughing as a result of Covid-19, we will not:

  • increase the rate or premium charged, or restrict the perils covered, unless the previous loss experience illustrates an underlying cause for concern.
  • require the removal of contents or stock from the premises.
  • require you to seal letterboxes.
  • require the water supply to be isolated at the mains and all systems drained down, unless the business plans to be closed beyond 15 August – if this is the expectation please discuss with our underwriters.

We will however require the premises to be appropriately secured and protected as follows:

  • the building must be inspected internally and externally at least once per week.
  • all refuse and waste materials must be removed from the premises.
  • the building must be secured, and all protective locks/alarms activated.
  • any building / premises with a Material Damage sum insured larger than £5m will require an intruder alarm, to a standard acceptable to AXA, to be fitted and in use.

Gas and electricity must be turned-off at the mains (other than any electricity supply supporting any intruder or fire alarm, security equipment or essential servers, Telephony or IT equipment).

Provided we have been notified of the Unoccupancy and the above conditions are complied with, full cover will remain in place pending any specific requirements being advised by our Underwriters.  As our policy advises, if you do not comply with these conditions you will not be covered, and we will not pay your claim.

For the avoidance of doubt, businesses and premises that are mainly occupied (50% or more of the building or site) or partially open (for example a restaurant providing a takeaway service or premises that are occupied one or two days per week) will not regarded as empty/unoccupied.

Please note: For buildings that were empty or unoccupied prior to 16 March, for customers who have businesses or premises that are permanently closed and will not be reopening in their original form and for non-qualifying new business customers, the unoccupancy/empty buildings conditions continue to apply in full.

AXA Coronavirus Hub update

Please see below the content we’ve recently added to our Coronavirus Hub for you and your clients:

In our Business Support section, there are 4 new Back to Business guides, covering:

  • Offices
  • Hotels (accommodation only)
  • Service sector operations
  • Takeaway and delivery services

We’ve also provided 4 new rradar Spotlight one-page articles, covering employee and business issues:

  • Withdrawing a new recruit’s job offer due to Coronavirus
  • Test and trace – Health & Safety implications
  • Coronavirus information risk assessments
  • Coronavirus large business loan scheme

There’s a new guide to the 11 ‘on demand’ webinars available on the rradar Coronavirus Portal, which is free to access for brokersThis has been updated with 18 more support resources, including What to do if an employee refuses to return to work after furlough.

In our Wellbeing & Resilience section, we’ve added further support from across the AXA group:

  • in Remote Working – a guide from Ignition, AXA’s broker marketing consultancy on How to health check your website
  • in Mind & Body – AXA PPP healthcare has provided a Covid-19 health risk return to work questionnaire.

Finally, there are just a couple of reminders on underwriting-related aspects.

Last week we outlined our cover for unoccupied premises after 15 June 2020, due to Covid-19 – details are in the Commercial Lines, Underwriting section of our Coronavirus Hub.

Alongside many businesses having to temporarily close their premises, many of our motor fleet insurance clients have also had to take their vehicles off the road during the Covid-19 lockdown.  This will have resulted in cover being reduced to exclude use on the road, and removal from the Motor Insurance Database (MID).

With many businesses now progressing out of lockdown, we want to remind you that Road Traffic Act cover is a legal requirement – vehicle cover will need to be reinstated to include this, and the vehicle reinstated on the MID should it be in use on the road.

I hope you find this latest information helpful for you and your clients and, as always, wish you and your families all the best.

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