Vacant Property Risks

Vacant construction sites face the risks of theft, trespassing, fires and other hazards. Potential losses might include the value of damaged or stolen materials, the liability of an individual being injured on the property, and the costs of organizational disruptions if an essential piece of equipment is vandalized or taken.

The insurance risks and liabilities associated with vacant construction sites can be extensive. Construction business leaders must be aware of their exposures to ensure they can adequately address them. In addition to purchasing comprehensive insurance coverage, these leaders can adopt several preventive strategies to maintain their vacant properties, thus reducing risk and liability.

Vacant Property Risks

Vacant construction sites can be a prime target for theft, trespassing and vandalism. It is also crucial to note that contractors can be held liable for injuries due to “attractive nuisances,” or dangerous conditions on a property that are likely to attract children and threaten their safety. Moreover, vacant construction sites are susceptible to fire since they often contain combustible materials, are vulnerable to arson, and may lack fire protection systems with alarms and sprinklers. Fires can result in significant property damage, environmental harm, and injuries to those in the area of the fire or to firefighters responding to the incident.

Ways to Mitigate Vacant Property Risks

Construction business leaders can implement several measures to mitigate the risks and potential liabilities that vacant properties present. Such strategies include the following:

• Install security systems to prevent trespassing, theft and vandalism. These systems should include proper lighting, sufficient signage, cameras and access controls.
• Ensure the property is free of hazards that could cause injuries to anyone on the property, including law enforcement officials, maintenance workers, firefighters and trespassers. All hazardous material, excess property, and combustibles in and around the site should be removed to avoid damage and potential fires. Walls, ladders, equipment, ditches, lumber piles and other physical features could be classified as attractive nuisances and should also be removed or made inaccessible to children who may try to enter the property and play with them.
• Have monitoring systems in place to detect issues before they evolve into major loss-causing events (e.g., water leaks). Fire alarms and fire suppression systems should also be in place and operational.
• Perform regular inspections of the vacant site for potential risks and immediately remediate any issues.
• Secure adequate insurance, such as builders risk insurance, that covers the property and any insurable materials on site against multiple perils, including fires, wind, lightning and vandalism. A licensed insurance professional can help construction business leaders select and secure the insurance policies that best meet their needs.

Conclusion

Vacant construction sites pose several risks. However, by being proactive and implementing strategies to address these risks, construction business leaders can enhance the safety of these locations, protect the property from criminal activities and trespassers, and mitigate their overall exposures.

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Article Published By: Zywave, Inc.