Unoccupied Homes: Insurance Requirements

If you're leaving a property empty for more than a month, you'll need to let your insurer know and may need to take out a specialist unoccupied home insurance policy. Standard home insurance policies typically won't cover properties that are left empty for 30 days or more. This is because vacant homes are more vulnerable to theft, vandalism, and other damage. Unoccupied home insurance can protect the buildings and contents of a property that is empty for an extended period of time.

Unoccupied vs vacant homes

The terms "vacant" and "unoccupied" are often used interchangeably in everyday conversation, but they have distinct meanings when it comes to property insurance coverage. Understanding the difference between these two terms is crucial when dealing with insurance claims.

Definitions

A vacant home is typically defined as being completely empty or lacking both people and personal property. In other words, it suggests that the property has been stripped of all furnishings and possessions, giving the impression that no one is currently living there.

On the other hand, an unoccupied home still contains personal belongings and furniture, giving it the appearance that the owners could return and resume residence at any moment. Additionally, an unoccupied home usually still has its utilities connected, whereas a vacant home may have them turned off.

Insurance Coverage

The distinction between vacant and unoccupied homes is significant in the context of insurance coverage. Most standard homeowners insurance policies are designed for occupied homes and may not provide coverage for vacant or unoccupied properties beyond a certain period, typically 30 to 60 consecutive days.

Vacant homes are generally considered a higher insurance risk due to their increased susceptibility to vandalism, theft, and other hazards. As a result, vacant home insurance is often more expensive and may require a separate policy or an endorsement to the existing homeowners policy.

Unoccupied homes, on the other hand, may be eligible for more comprehensive homeowners insurance coverage, depending on the specific definitions outlined in the insurance policy. It is important for homeowners to review their policies carefully and contact their insurance providers to ensure they have the appropriate coverage.

Preventative Measures

To protect a vacant or unoccupied home from damage and crime, several precautions can be taken. These include:

• Maintaining the yard and landscaping to give the appearance that the property is not abandoned.
• Installing security measures such as strong locks, alarm systems, and smart home devices that can detect water leaks or smoke.
• Enlisting a trusted individual to regularly check on the property and report any issues.
• Setting up motion-sensor lights and timers for interior lights to deter potential intruders.
• Taking steps to prevent frozen pipes, such as setting the thermostat to a minimum temperature and draining the water lines.

Vandalism and theft

Most standard home insurance policies will not cover vandalism or theft if a home has been vacant for over 60 consecutive days. A structure is considered vacant if no one is living there and it is substantially empty of personal property. Vandalism committed by any of the insured is also not covered. For example, if you live with a partner who is named insured on your policy, and they move out but remain insured under the policy, any damage they inflict would likely be denied reimbursement because it is an intentional act committed by one insured person against another.

However, vandalism and malicious mischief insurance is included in most basic commercial and homeowner insurance policies. This type of insurance covers the intentional injury or destruction of property. Vandalism includes any willful destruction of or damage to property, such as graffiti and spray-painting, smashing locks and windows, salting or damaging lawns, and cutting down trees or shrubbery.

If your unoccupied home has been vandalised or broken into, you should contact the police as soon as possible to report the incident and obtain a report number. You should also call your insurer as soon as possible to have a claims adjuster handle your claim. You will need to provide the police report or police report number, as well as any photos or videos of the damage.

Fire, floods and storms

Unoccupied homes are at a greater risk of damage from fire, floods, and storms. This is because no one is present to spot problems early on, which means that damage is likely to be more extensive and expensive. For example, a small fire in an occupied home is likely to be reported and dealt with quickly, whereas a fire in an unoccupied home could rage on for some time before anyone notices. Similarly, a storm could cause a tree to fall on your home, and the damage would be much worse if no one was there to quickly address the situation.

Unoccupied homes are also more likely to suffer from burst pipes, which can cause extensive water damage. This is why insurers are reluctant to extend coverage to homes that are vacant long-term.

Fire

Most home insurance policies cover you for damage caused by fires, including bushfires. However, common exclusions include accidental fires caused by negligence or recklessness, and fires in homes that do not comply with fire regulations.

Floods

Flood cover is often optional and must sometimes be purchased separately. Exclusions often include actions of the sea, such as storm surges, high tides, and king tides, as well as floodwater combined with run-off or rainwater.

Storms

Most home insurance policies cover storms, including damage caused by lightning, cyclones, strong winds, rainwater, hail, and snow.

Home insurance costs

In the US, standard homeowners insurance policies do not typically cover houses that have been vacant for more than 30 to 60 days. If you expect your home to be unoccupied for longer than a month, you will need to purchase unoccupied or vacant home insurance. This type of insurance can be bought as a separate policy or as an endorsement to your existing policy.

Unoccupied and vacant home insurance is more expensive than standard homeowners insurance. You should expect to pay around 50% more for this type of insurance, which equates to about $500 more per year. The cost of vacant home insurance depends on factors such as the amount of coverage you choose and the location of your house. The more coverage you want, the more you will have to pay. The location of your house is important because different states have different risks that will impact insurance rates. For example, some states are more prone to natural disasters such as hurricanes, floods, and earthquakes, which will increase the cost of insurance.

The age of your home will also impact the price of your insurance. Older homes are more expensive to insure because they do not have modern safety features, and repairs are usually more costly. The condition of your home is also important. If your home is in a poor state of repair, you may be unable to get a policy. Most insurers will require your property to have certain security devices, such as burglar alarms and approved locks on all doors and windows.

Another factor that will influence the cost of your insurance is your credit score. In most states, insurance companies will review your credit history when providing you with a quote. A poor credit score will result in higher insurance premiums.

You may be able to save money on your insurance by purchasing multiple policies from the same company. You can also get discounts by installing security and safety measures, such as deadbolts, fire alarms, security cameras, and smart-home devices.

How to get vacant home insurance

If you leave your home unattended for a long period, your standard home insurance policy will likely not cover any damage that occurs. Therefore, you will need to purchase vacant home insurance, which is a specialty insurance product designed to provide financial protection for uninhabited homes.

• Determine whether you need a vacant home insurance policy: Find out how long your home can be unoccupied before it is considered vacant. Remember to be honest with your insurance company about the status of your property.
• Check with your current insurance provider: Ask your insurance provider how they handle vacant home coverage. Some providers allow you to add coverage to an existing policy, while others require a separate policy.
• Shop around and compare quotes: Don't be afraid to explore other insurance providers to find the best coverage and price. Consider factors like deductibles and coverage limits, in addition to monthly costs.
• Apply for vacant home insurance: Gather the necessary documents, which may include a government-issued ID, proof of ownership, the estimated value of the home, and the estimated time it will be vacant.
• Choose the length of cover: You can usually insure a vacant home for shorter periods than the standard 12-month policy. Most insurers offer short-term policies of three, six, or nine months, which is useful if you are selling the property and unsure how long it will take.

It is important to note that vacant home insurance is typically more expensive than standard home insurance, as vacant homes are considered higher risk. This increased risk is due to factors such as slower emergency response times and a higher probability of break-ins.

Frequently asked questions