risk management

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.

Risky Business

Posted on January 26, 2016
One of the best ways to reduce the cost of your insurance is to demonstrate that your business has a responsible health and safety practice in place.

One of the best ways to reduce the cost of your insurance is to demonstrate that your business has a responsible health and safety practice in place.

Risky Business

There’s no doubt about it, insurance is complicated. The amount of jargon associated with the subject can be off-putting for many, and can make finding the right insurance product a difficult and complex process.

However, choosing the right insurance partner can be the difference between success and failure in the event of a catastrophe.
Holiday parks offer a unique blend of risk to the insurance market. By their very nature, parks are exposed to the elements, presenting an accumulation of challenges to the insurer.
According to Compass Insurance, storm damage is the highest claimed peril on holiday and caravan parks, followed by accidental damage and escape of water or burst pipes. These perils make up 50 per cent of the company’s received claim volumes. The remaining 50 per cent is made up of theft, liability, fire, impact, and subsidence claims.

“We have discovered that although the needs of individual park owners vary, there are three distinct elements of essential park insurance to consider – material damage, liability cover and financial protection,” explains Dave Sheath, managing director at Compass.
“Essential holiday park insurance should cover buildings and structures, hire fleet and sales stock, underground services, contents, loss of rent or alternative accommodation, Business Interruption, Public Liability and Employer’s Liability.”

Holiday parks offer a unique blend of risk to the insurance market. By their very nature, parks are exposed to the elements, presenting an accumulation of challenges to the insurer.

Holiday parks offer a unique blend of risk to the insurance market. By their very nature, parks are exposed to the elements, presenting an accumulation of challenges to the insurer.

In addition to ensuring the essential areas of cover are in place, careful consideration should always be given to the sums insured declared. By under estimating sums insured, to potentially save on premium costs, park businesses could be exposed to risks by being underinsured.
Appointed by The British Holiday & Home Parks Association (BH&HPA) to serve the interests of its members, Compass offers two bespoke policies; a Compass General policy and a Compass Park Owned policy. As well as providing essential cover, the bespoke policies also of a range of products that can be tailored to meet the needs of the park, including Contractors All Risks, Fidelity Guarantee and Employment Practices Liability, Environmental Liability and Cyber Liability.
“Operating in a changing environment will mean your business is faced with new and emerging risks,” says Dave. “With this in mind, you may want to consider new policies. It is worth considering all options available as the cost of extending cover or purchasing new risks may not be as expensive as you think.”

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