COMMERCIAL PROPERTY CASE STUDY
Multi-Tenanted Industrial Building, Western Sydney
A tenant mix that often sits outside standard insurer appetite meant mainstream insurers either declined or quoted premiums the owner couldn't justify. We found a better option.
THE SITUATION
A commercial building in Western Sydney with four tenancies was referred to us by a mortgage broker at settlement. The owner needed cover in place quickly to satisfy the lender's requirements.
The tenant mix was the challenge. The building housed mechanics, trade workshops, and other occupations that sit outside most mainstream insurers' appetite. These are the types of tenants that trigger automatic declines in online quoting systems.
OUR APPROACH
We submitted the risk across our panel, targeting insurers who have appetite for industrial and trade-based tenancy mixes. Each submission included a detailed breakdown of the tenant occupations, building construction, and fire protection measures.
For properties with tenants insurers treat with more caution, the way the risk is presented to underwriters matters. We focused on the building's overall risk profile rather than letting individual tenant types dominate the assessment.
THE CHALLENGES
Multiple mainstream insurers declined due to the tenant occupations. Mechanic and tyre shops are flagged by most automated underwriting systems because of the fire and environmental exposure.
The only quote initially available was over $44,000 - a premium the owner felt was disproportionate to the risk and would eat significantly into the property's returns.
THE OUTCOME
We placed the property at around $15,000 - saving the owner approximately $29,000 compared to the only alternative quote on the table.
The saving came down to knowing which insurers manually underwrite industrial property risks rather than relying on automated systems that auto-decline certain tenant types. The same building, same tenants, same risk - but a dramatically different premium from an insurer who understood the actual exposure.
This is a common pattern with multi-tenancy commercial properties. The first quote you get isn't necessarily representative of the market. A broker who knows where to go can often find significantly better terms.
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Mechanics, trade workshops, food businesses, and other tenants that often sit outside standard insurer appetite don't have to mean expensive or unavailable insurance. We know which underwriters have appetite for these risks.