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We work with the UK’s leading commercial property insurers
UNDERSTANDING WHAT’S NOT COVERED
Why Exclusions Matter
Commercial property insurance provides essential protection, but it **does not cover every type of loss**. Many claims are declined each year because businesses are unaware of key exclusions, policy limitations, conditions or responsibilities placed on the policyholder.
This guide highlights the most common exclusions so you can make informed decisions - and add additional cover where needed.
Common Commercial Property Insurance Exclusions
- Wear and tear or gradual deterioration
- Damage caused by poor maintenance
- Defective design, workmanship or materials
- Electrical or mechanical breakdown (unless added)
- Subsidence if not selected as an optional peril
- Flood damage in high-risk zones (some insurers exclude)
- Unoccupied buildings without specialist cover
- Deliberate or malicious acts by the policyholder
- Damage by tenants (unless malicious damage extension included)
- Asbestos or contamination costs
Risks That Are NOT Automatically Included
- Terrorism cover (requires a separate add-on)
- Business interruption unless selected
- Loss of rent for landlords unless chosen
- Damage to machinery/plant without breakdown cover
- Cyber-attacks or digital losses
- Contractors’ works (requires Contractors All Risks cover)
- Fine art or high-value specialist items
- Flood cover for highly exposed properties
Why Understanding Exclusions Is Essential
- Ensures you avoid gaps in cover
- Helps prevent claim rejection
- Allows you to add optional extensions where needed
- Helps match your policy to lender/lease requirements
- Provides clarity for landlords & tenants on responsibilities
- Supports long-term risk management & compliance
FREQUENTLY ASKED QUESTIONS
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What is the most common reason a property claim is rejected?
The most common reasons include lack of maintenance, underinsurance, incorrect rebuild values, and excluded perils such as wear and tear.
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Does commercial property insurance cover everything inside a building?
No - contents, machinery, stock and fixtures may need separate cover or enhanced policy sections.
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Does standard insurance include flood or subsidence?
Flood and subsidence may be excluded depending on location or claims history but can often be added with specialist terms.
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Are machinery and equipment breakdowns covered?
Not under standard buildings insurance - separate plant & machinery breakdown cover is required.
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What about unoccupied properties?
Standard insurance often excludes unoccupied buildings. A specialist unoccupied property policy is required.