Student Accommodation Insurance
Student accommodation has a distinctive seasonal occupancy pattern. The building fills in September, empties at Christmas and Easter, and may have significantly lower occupancy during the summer period, which means the occupancy question has an answer that changes through the year.
Purpose built accommodation and a converted house let to students are different risks despite housing the same people. A purpose built block has compartmentation, detection and a management presence designed in; a converted terrace has a licence, a fire alarm retrofitted into a Victorian layout, and nobody on site.
Claims can be driven by the frequency of smaller incidents as well as more serious losses. Communal kitchens produce cooking fires and escape of water, doors and walls take damage through the year, and the annual changeover produces a burst of small losses as one cohort leaves and another arrives.
We can advise owners and operators of student property, from a licensed house let room by room to a purpose built block with nomination agreements, on how the building and the income should be insured.
Common claims and risk exposures
The exposures that produce claims in this trade, rather than a generic list.
Communal kitchen fires
Shared kitchens in constant use by people cooking independently at all hours are the main ignition source. Unattended pans, grill trays and toasters dominate, and in a block the consequence is a full evacuation rather than one damaged kitchen.
Alarm activations and the response to them
Student buildings generate frequent false alarms from cooking, and the risk is that residents stop responding to them. Insurers ask what detection is installed, whether it is monitored, and what management does about repeated activations.
The long summer void
A building that is empty from June to September is unoccupied for a quarter of the year. Escape of water in an unattended block runs for weeks rather than hours, and the standard unoccupancy conditions were not written with a fixed annual void in mind.
Changeover damage and turnover
Every room changes occupant at the same time each year. Damage discovered at checkout, moving injuries, and the concentration of work into a few weeks all sit outside the ordinary letting pattern of other residential property.
Income tied to the academic year
If a loss in July prevents reletting for September, the income lost is not a few weeks of rent but an entire academic year. The timing of the incident matters more on this class than on any other residential property.
The cover we arrange
We arrange insurance around the property, its use, construction, occupancy and ownership structure. The cover available will depend on the individual risk and the terms offered by insurers.
Buildings
The structure and landlord's fixtures on a reinstatement basis, including communal kitchens, study spaces, laundries and the fit out of individual rooms where the owner provides it.
- Structure and communal areas
- Fitted kitchens and study furniture
- Laundry and plant where provided
- Professional fees and debris removal
Property owners liability
Injury to residents, their visitors and contractors. In a block the exposure concentrates in stairs, kitchens, laundries and social spaces used by large numbers of people at once.
- Injury in communal areas
- Residents' visitors
- Limits typically £5m or £10m
- Defence costs included
Loss of rent across the academic year
Rent lost while rooms cannot be occupied, with an indemnity period long enough to cover the possibility of missing a full intake rather than merely the reinstatement.
- Rent from every room let
- Indemnity period of 24 months or more
- Allows for missing an academic year
- Nomination agreement income where applicable
Malicious and accidental damage
Worth taking on this class given turnover and the age of the occupants. Expect a higher excess and conditions about deposits, guarantors and inspections.
- Damage by residents and their guests
- Communal area damage
- Higher excess than standard perils
- Deposit and guarantor conditions
Cover through the summer void
Terms agreed in advance for the annual empty period, rather than relying on a clause written for an unexpected vacancy. Usually conditional on inspections and on services being isolated.
- Void terms agreed before the summer
- Scheduled inspections during the void
- Water isolated or systems drained
- Alarms maintained and set
What an underwriter will ask
Having these to hand shortens the process considerably, and usually improves the terms.
- Whether the property is purpose built or converted, and if converted whether licensed as an HMO
- Number of rooms, number of kitchens, and how many share each one
- Fire detection grade and coverage, and whether it is monitored
- Compartmentation, fire doors and the escape route from upper floors
- Whether there is on site management or a warden, and the hours covered
- Letting basis: direct lets, nomination agreement with a university, or a mix
- The pattern of the summer void and whether the building is let for conferences
- Claims history, in particular repeat escape of water and alarm related incidents
What affects the cost of your insurance?
The main factors insurers consider when assessing the premium.
Purpose built or converted
A purpose built block with designed in compartmentation, detection and management rates better than a converted house serving the same market, because the protections are part of the building rather than retrofitted.
Kitchen arrangements
How many residents share a kitchen is one of the more direct influences on fire frequency. Studio units with individual kitchens spread the risk; a single kitchen shared by twelve concentrates it.
Management presence
On site management, or a warden with defined hours, improves terms noticeably. Someone who responds to an alarm at two in the morning changes the outcome of a common incident on this class.
Claims frequency and the void
Repeat escape of water, particularly discovered late during a void, is the pattern that hardens terms. Agreed void arrangements with documented inspections are the mitigation insurers respond to.
Conditions and exclusions to consider
Terms vary between insurers, so treat these as the questions to ask rather than a description of any one policy.
Void conditions during the summer
Where the annual void has not been agreed in advance, the standard unoccupancy restrictions apply and remove theft, malicious damage and escape of water for the months the building is least watched.
Theft without forcible entry
In a building where many people hold keys and doors are propped during changeover, theft claims without evidence of forced entry usually fall outside standard wording.
Residents' own possessions
The building policy does not insure students' laptops, bikes and belongings. Many operators arrange a contents scheme for residents, which is separate cover rather than an extension of the building policy.
Letting outside the declared basis
Summer conference lettings, short term holiday use or a change from student to general residential occupation all change the risk and need to be agreed rather than assumed.
Common questions
Is student accommodation just an HMO?
A converted house let room by room to students usually is, and will need a licence and HMO terms. Purpose built student accommodation is a different class again, generally outside HMO licensing but underwritten on its own basis with scale, management and compartmentation in mind.
What should we do about the summer when everyone leaves?
Agree it with the insurer before it happens. A predictable annual void is straightforward to cover on agreed terms with inspections and services isolated, and it is far better than relying on a clause designed for an unexpected vacancy.
Are students' belongings covered?
Not by the building policy. Many operators arrange a block contents scheme so residents have cover without buying it individually, which also reduces the number of disputes after a communal incident.
Why does the timing of a claim matter so much?
Because the income is annual rather than monthly. A fire in July that prevents reletting for September costs a full academic year of rent, which is why the indemnity period on this class needs to be longer than the rebuild time alone would suggest.
How do I get a quote from True Risk Solutions?
Call 01304 262880 and speak to a broker, or email info@truerisksolutions.co.uk with what you do, what you need cover for and a phone number with the best time to call, and a broker will call you back. We need a phone number to quote, because the cover and the price depend on questions that are quicker to answer on a call than by email.
Speak to a specialist who understands your industry
Tell us about your business and the work you undertake, and we will come back to you with cover options built around it. Call 01304 262880, or email us with a phone number and the best time to call and a broker will ring you back.