Four-Tenancy Retail and Residential

A property investor in Adelaide owned a 1990s-built mixed-use building with a retail shop on the ground floor and three residential units above. Despite being relatively modern construction, seven insurers declined to quote.

They'd received one quote from another insurer at around $7,000, but felt the pricing didn't reflect the actual risk. The building was well-maintained, the retail tenant was low-risk, and there was no claims history to speak of.

The owner came to us looking for a more competitive option from someone who understood the mixed-use market.

A 1990s build with a standard retail tenant and three residential units is actually a straightforward mixed-use risk. The challenge isn't the risk itself - it's finding underwriters who will assess it on its merits rather than automatically loading for the mixed-use classification.

• Risk assessment: We documented the building's condition, construction type, and fire safety measures. A 1990s build typically meets modern standards, which is a strong positive for underwriters
• Tenant profiling: We detailed the retail tenant's business type and operations to demonstrate it was a low-risk commercial occupancy
• Competitive market approach: With a relatively clean risk profile, we were confident we could find better terms than the $7,000 quote and focused on underwriters known for competitive pricing on lower-risk mixed-use

The main challenge here wasn't the risk complexity - it was the mixed-use classification itself. Many insurers have automated underwriting systems that decline any property with both residential and commercial tenancies, regardless of the actual risk profile.

Seven declines for a 1990s building with a straightforward retail tenant shows how the market treats mixed-use as a category rather than assessing the individual risk. It's a common problem we see across the mixed-use property insurance space.

We placed comprehensive cover at approximately $3,900 - a saving of around $3,100 compared to the other quote of $7,000.

This is a good example of what happens when you place a mixed-use risk with an underwriter who actually wants to write it, rather than one who quotes high because they're not entirely comfortable with the risk class. The right market access makes a real difference to premiums.