Commercial Property Warranty

What is a commercial building warranty?

A commercial building warranty, also known as a commercial property warranty, is a type of insurance policy for owners or developers of a commercial property.

It typically lasts for 10 or 12 years and protects the owner from financial losses caused by structural defects or other issues that may arise after the building is completed.

What types of commercial properties are eligible for a commercial building warranty?

Commercial building warranties are designed to protect developers and owners of commercial properties from unexpected defects. They offer comprehensive financial protection for a range of commercial construction projects, ensuring that buildings are legally safe to sell, lease, or rent out.

There are a range of commercial property types that are eligible for a commercial building warranty, such as:

• Mixed Use developments: These properties combine residential and commercial use, such as apartments above retail units or offices.
• Purpose-built student accommodation (PBSA): These are purpose-built buildings designed specifically for student housing.
• Offices: This includes traditional office buildings, as well as co-working spaces and business centers.
• Retail: This covers a wide range of retail properties, from small shops to large shopping centers.
• Industrial: This includes warehouses, factories, and distribution centers.
• Hotels and hospitality: This includes hotels, motels, guesthouses, and other accommodation providers.
• Education: This includes schools, colleges, and universities.
• Healthcare: This includes hospitals, clinics, and care homes.

It’s important to note that the specific eligibility criteria may vary between different warranty providers.

What are the benefits of a commercial building warranty?

By obtaining commercial building warranty for your project you will be able to reap a range of benefits such as:

• Protection against structural defects: Covers the cost of repairs for structural issues that may arise within the warranty period.
• Property attractiveness: Warranties enhance the building to buyers and tenants, potentially increasing its perceived value.
• Simplified selling and leasing: Warranties streamline the sale or lease process by reassuring potential buyers and tenants about the building’s structural integrity.
• Reduced liability for developers and owners: By having warranty in place, the risk of structural defects is transferred to the warranty provider.
• Faster claim processing: You may find that warranties often have quicker claim resolution periods compared to more traditional insurance claims.
• Bespoke coverage: Warranties can be tailored to the specific needs of a building project.

Not having a commercial building warranty for your property could lead to various issues over time, such as legal implications, as the liability will lie with the property owner. If the purchaser discovers major defects, they may seek legal action against the seller.

Alternatively, if the commercial unit is rented, tenants have the right to claim compensation if defects render the property unsafe.

What is the difference between a commercial building warranty and a residential warranty?

While both commercial and residential building warranties offer protection against defects, they differ in several key areas:

• Property Type: Commercial warranty is for a range of properties intended for commercial use such as schools, shops and warehouses, whereas residential warranty is for homes.
• Coverage: Commercial warranties primarily focus on structural integrity, while residential warranties often cover a broader range of components.
• Bespoke Coverage: Commercial warranties offer more flexibility for tailoring coverage to specific building needs.
  It’s important to note that specific terms and conditions can vary between different warranty providers. It’s advisable to carefully review the policy details to understand the exact coverage and limitations.

What does a commercial building warranty cover?

Each commercial building warranty policy will vary depending on the case type but generally a warranty will cover as standard; structural damage, defects to walls, roofs and foundations.

How long is a commercial building warranty valid for?

Commercial building warranty lasts for 10 years; however, upon request and subject to further requirements, your commercial property warranty can be extended to 12 years.

How much does a commercial building warranty cost?

The cost of a commercial building warranty will vary significantly on a case-by-case basis and will depend on several factors, such as the scale, location, and requirements of the commercial building.

To get a non-obligation commercial building warranty quote and understand the approximate cost to cover your commercial building, you can either fill out an online form or call one of our expert commercial advisers on 0800 059 0150.

How do I obtain a commercial building warranty?

The first step in obtaining a commercial building warranty is to find a reputable structural warranty provider, such as CIR, who can inform and guide you through the process of application and completion of your policy.

The standard process of obtaining a commercial building warranty (which may vary by provider) is:

• Request a quote from CIR
• An expert commercial warranty adviser will contact you with your bespoke quote
• Payment of survey fees and insurance premium
• Documentation & site plans are supplied to the insurer
• Site visits will be carried out through the duration of the build to check the progression of the project in line with the policy
• If everything is in order, the warranty will be issued by CIR

What does the claims process involve for a commercial building warranty?

If the time comes that you need to call upon your commercial property warranty for any reason, here are the steps that you should take:

Contact: Contact your warranty provider

Evidence: Provide as much information and documentation as possible regarding your claim, such as photograph and video evidence

Outcome: Wait for the evaluation of your claim whereby your policy provider will outline the coverage that you are eligible for