Do you have a home that is not your primary residence right now? If so, it’s essential to understand the amount and type of home insurance you need for it. Here’s what’s important – your current primary home insurance policy may not cover a home if it is vacant, unoccupied, or seasonal. What’s more, these are all different classification of homes. Do you have the right protection?
Coverage Provided by Your Existing Policy – It’s Limited
When our clients visit us and let us know they are going on vacation or moving, we always discuss the risks associated with leaving a home empty. But, most people don’t know their primary insurance isn’t always going to apply.
Vacant Homes Are High Risk
The highest risk home is the vacant home. This is a home no one lives in, but also one without furniture. This can happen if you are moving and your home doesn’t sell or if your loved one moved out or passed away and you are waiting to decide on the property. This is a high-risk home because no one is there to monitor it for risks.
Vandals break in, shatter the glass door, and spray paint the interior. It’s thousands of dollars’ worth of loss. Do you have coverage? Not always. If the home is vacant for beyond 60 days, your existing policy is unlikely to cover the damage. This is especially true if the agent does not know the home is vacant. Inform them, and then customize or improve your policy to protect the structure more fully.
Most insurance companies do not insure vacant homes for very long. They may cancel the policy. It’s essential to get a specialized policy in place quickly.
Unoccupied Homes Pose Risks, Too
An unoccupied home is one where you could be living there tomorrow if you wanted to. It has home furnishings as well as the utilities in place. A common example is a long vacation or hospital stay in which the home is empty for a period of 30 to 60 days.
Again, someone can easily break into this home. Other risks exist as well. With the furnace on, for example, a fire could start, engulfing the home. But, if the insurer does not know the home is unoccupied, your losses may lack any coverage.
In this situation, a special endorsement is possible if you alert your agent. It’s also best to have a friend or family member move in instead of leaving it empty.
The Seasonal Home Requires Special Coverage
Your seasonal home is one you use on and off. You hopefully have a property management company maintaining it. Your primary residential policy may include your second home (but this is not always the case).
A key to remember here is that if your rent out the property even to friends, you need a different form of insurance. Your standard policy will offer no protection if those renters (even weekend visitors) cause damage, a fire, or flooding.
Where to Start with Protecting Your Home
If you anticipate your home will be unoccupied or vacant for any length of time, call your agent. Krog Insurance works with homeowners who need specialized policies like this.
Because these are high-risk homes, it is important to get coverage in place. The risk that something will happen at these properties is high. You do not want to lose your investment or have to pay for repairs out of your pocket.