coastal erosion

IS YOUR HOLIDAY PARK INSURANCE KEEPING PACE WITH YOUR BUSINESS?

Posted on August 3, 2026

By Kevin Minnear, Head of Underwriting, Compass Insurance...

The caravan and holiday park sector is facing a rapidly shifting risk landscape. Renewing insurance on the same basis as previous years is no longer viable. In today’s market, it is a recipe for significant financial shortfall.

THE CLAIMS LANDSCAPE
Successful claims are increasingly dependent on meticulous documentation, not simply the occurrence of an insured event. Insurers now expect up-to-date maintenance logs, drainage records, and professional arboricultural surveys.

Parks that can demonstrate scheduled maintenance programmes tend to achieve better outcomes; those relying on informal checks may face difficult liability disputes. The most common reason for a reduced or unsuccessful claim is underinsurance, triggering the average clause, which can see your payout reduced or, in serious cases, withheld entirely.

AVOIDING THE UNDERINSURANCE TRAP
If your policy figures are a few years old, you are almost certainly underinsured. New assets to declare and accurately value include EV charging infrastructure, outdoor experience areas such as fire pits and pizza ovens, and underground services including pipes, cables, and fibre-optic Wi-Fi.

The Royal Institution of Chartered Surveyors (RICS) estimates rebuild costs rise by 3% to 7% annually, making a review at every renewal essential. Emerging risks to address include coastal erosion and flash flooding, cyber threats from digital bookings and automated gate access (which may not trigger cover if your policy requires physical damage), and fluctuating seasonal stock levels, which should be insured at their peak, not their lowest.

MATCHING COVER TO MODERN OPERATIONS
With dog-friendly holidays now mainstream, animal incidents have become an increased liability risk. Clear rules, designated exercise areas, and documented incident records are essential.

Parks should also clarify where their liability ends and a private unit owner’s begins, and consider requiring private owners to provide annual proof of insurance.

THE DANGERS OF RENEWAL INERTIA
A recent report by the Association of British Insurers (ABI) report found that almost half of SME decision-makers had not reviewed their cover in the previous 12 months. Key areas to address:

• Indemnity periods. A standard 12-month business interruption period is rarely sufficient for holiday parks. Extending to 24, 36, or 48 months is worth exploring and often more affordable than expected.
• Rebuild vs market value. Your insurer needs reinstatement cost, including architects’ fees, site clearance, and compliance with current regulations, not market value.
• Policy conditions. Missing a stipulated alarm type or electrical inspection (EICR) could void your cover entirely.

Commission a professional reinstatement cost assessment, stress-test your business interruption cover, and audit your site with fresh eyes. The insurance market is not punishing holiday parks; it is demanding greater clarity and higher standards of risk management.

Compass Insurance
0344 274 0276
compassparks.co.uk

Opinions expressed in this article are that of Compass, based on our expert view of the market dynamics, unless specific additional source(s) is/are listed.

WHY WILDFIRE RISK IS THE NEW CHALLENGE FOR UK CARAVAN PARKS

Posted on May 6, 2026

For decades, UK holiday park operators have focused on water-based risks such as flooding, storm surges, and coastal erosion. Most have robust flood evacuation plans and invest in drainage and coastal defences. However, a new threat is emerging at the opposite end of the spectrum: wildfire.

The Summer of 2025 highlighted the danger. Following England’s driest Spring since 1893, the UK recorded 117 wildfires – more than double 2023’s total. One near-miss occurred at Grouse Hill Caravan Park on the edge of the North York Moors, where a wildfire spread rapidly toward the site.

Only a change in wind direction and the heroic efforts of North Yorkshire Fire and Rescue prevented a catastrophe. Caravans are particularly vulnerable. Plastic and thin cladding, close proximity of units, and LPG cylinders create a “domino effect” risk.

Many parks are surrounded by forests, heathland, or long grass, which become fuel beds during dry spells. Compass Insurance data shows fire claims peaked at over £165,000 between June 2022 and May 2023 – a six-fold increase from the previous year.

PROACTIVE RISK MANAGEMENT IS NOW ESSENTIAL:
1. Defensible space: Clear vegetation and maintain buffer zones to slow or stop fire spread.
2. LPG and safety equipment: Store gas bottles upright in shaded areas and equip units with fire blankets and extinguishers. Regularly check smoke alarms and fire equipment.
3. Infrastructure and access: Ensure roads allow fire service access, hydrants are clearly marked and tested, and evacuation routes are never blocked.
4. Evacuation planning: Establish rapid communication channels and plan for residents with mobility issues. Wildfires move fast – unlike floods, there may be no warning.
5. Resident responsibility: Preventable causes such as careless barbecue use, improper cigarette disposal, and electrical overloads remain a major risk.

Temporary bans or designated zones can help Climate change is intensifying these risks. As insurers, we see that prevention is the most effective protection. By treating wildfire risk with the same attention as flooding, parks can remain safe for visitors and residents. Proactive planning, careful site management, and clear safety communication are essential to protecting property, people, and peace of mind in an era of extreme weather.

Compass Insurance
0344 274 0276
www.compassparks.co.uk