Vacant Dwelling Insurance: Defining 'Vacant

Vacant home insurance is a type of insurance coverage for properties that are uninhabited or considered vacant. This type of insurance is important because standard homeowners insurance policies often have vacancy clauses, which restrict or exclude coverage on properties that have been vacant for a certain period of time, typically 30 to 60 days. Vacant homes are more vulnerable to theft, vandalism, and other types of damage, so insurance companies consider them a higher risk.

Vacant home insurance covers many of the same things as a standard homeowners insurance policy, such as damage caused by fire, lightning, wind, hail, explosions, and water intrusion. It's important to note that vacant home insurance is more expensive than standard home insurance due to the increased risks associated with unoccupied properties.

• Owning a vacation home that is only used occasionally
• Performing extensive renovations or repairs
• Hospitalization or medical treatment
• Owning a rental property between tenants |

Vacant vs unoccupied homes

When it comes to insurance, vacant and unoccupied homes are considered differently. Vacant homes are seen as a higher risk than unoccupied homes, and thus, insurance for vacant homes is more expensive.

Vacant vs. Unoccupied Homes

The primary difference between vacant and unoccupied homes is the presence of furniture and other personal belongings. A vacant home is typically devoid of any personal items, whereas an unoccupied home has enough furniture for someone to live in it at any time. A vacant home may also have its utilities turned off, while an unoccupied home still has its services connected.

Insurance Considerations

Insurance companies view vacant and unoccupied homes differently due to the varying levels of risk associated with each. Vacant homes are considered a higher risk because they are more attractive to thieves and vandals, and there is a greater chance of damage occurring. For example, a burst pipe could cause extensive damage to a vacant home as no one is there to catch it and turn off the water supply.

On the other hand, an unoccupied home is seen as a lower risk because any damage that occurs is likely to be reported sooner, resulting in lower costs for the insurance company.

Impact on Insurance Rates

The determination of whether a house is vacant or unoccupied significantly impacts insurance rates. Vacant homes require a special type of insurance called vacant home insurance, which is more expensive than standard homeowners insurance. This is because vacant homes are considered a higher risk and are more likely to suffer damage or loss.

Unoccupied homes may still be covered under a standard homeowners insurance policy, depending on the specific circumstances and the insurance company's definitions of "vacant" and "unoccupied."

When to Get Vacant Home Insurance

If you plan to leave your home vacant or unoccupied for an extended period, typically 30 days or more, you will need to purchase vacant home insurance. This type of insurance can be purchased as a separate policy or as an endorsement to your existing homeowners insurance policy.

In conclusion, insurance companies make a clear distinction between vacant and unoccupied homes due to the differing levels of risk associated with each. Vacant homes are considered a higher risk and, therefore, require a special type of insurance that is more expensive. It is important for homeowners to understand these differences and proactively communicate with their insurance company to ensure they have the appropriate coverage.

When is vacant home insurance needed?

Vacant home insurance is a type of insurance coverage designed to protect homes that are vacant for an extended period. This type of insurance is necessary when a standard homeowners insurance policy does not cover a vacant property.

Standard homeowners insurance typically covers a primary residence that is lived in, protecting against financial losses associated with theft, fire, and other covered perils. However, if a home is vacated, the insurance provider may require the purchase of vacant home insurance, as the standard policy may not be sufficient.

Vacant home insurance is needed when a home is unoccupied or vacant for an extended period, generally considered to be between 30 and 60 days or more. This timeframe can vary depending on the insurance company and their specific definition of vacancy.

Vacant home insurance is typically required in the following situations:

• Selling a home that you have already moved out of.
• Owning a rental property that is vacant between tenants.
• Performing extensive renovations or repairs that make the home temporarily uninhabitable.
• Hospitalization or medical treatment that requires an extended stay away from home.
• Owning a vacation home that is only used for a few months of the year.
• Travelling for an extended period or being on active military duty.

Vacant home insurance can be purchased as a separate policy or added as an endorsement to an existing homeowners insurance policy. It is designed to cover similar risks to a standard policy, such as fire, lightning, explosions, wind, hail, smoke, water damage, and in some cases, vandalism and theft.

Vacant homes are considered higher risk by insurance companies due to the increased likelihood of vandalism, break-ins, and undetected issues such as water leaks or fires. Therefore, vacant home insurance is typically more expensive than standard homeowners insurance, with costs varying based on the insurance company, policy, and the home's risk profile.

What does vacant home insurance cover?

Vacant home insurance is designed to protect homes that are unoccupied for an extended period. This type of insurance is necessary because standard homeowners insurance policies typically do not cover vacant properties.

Vacant home insurance policies can be purchased as separate policies or added to existing homeowners insurance policies as endorsements. They are designed to offer protections similar to standard homeowners insurance policies, covering damage from perils such as fire, lightning, explosions, windstorms, hail, smoke, and water intrusion. Coverage for vandalism and theft may also be included, but this can vary by structure and insurance provider. Liability coverage is usually not included in vacant home insurance policies, but it may be possible to add it.

Vacant home insurance policies typically only cover the structure of the home, not the land or other assets. The cost of vacant home insurance is typically higher than standard homeowners insurance, ranging from 50% to 60% more due to the increased risks associated with vacant properties. These risks include slower emergency response times, a higher probability of break-ins, and undetected issues such as burst pipes.

Some insurance companies may also offer flexible payment options and prorated cancellation if the home becomes occupied before the policy ends. It is important to note that the definition of "vacant" may vary between insurance companies, with some considering a home vacant if it has been unoccupied for 30 days, while others may extend this to 60 days or more.

How much does vacant home insurance cost?

The cost of vacant home insurance depends on several factors, including the insurance company, the location of the property, the length of the vacancy, and the risk profile of the home. Vacant home insurance is generally more expensive than standard homeowners insurance because vacant properties are considered higher risk. They are more susceptible to theft, vandalism, and damage, and issues are often worse by the time they are discovered.

On average, vacant home insurance costs 50% to 60% more than a standard insurance policy for an occupied home. For example, if a full-time occupied home costs $1,200 per year to insure, vacant home insurance for the same property would likely range from $1,800 to $3,000 annually.

The cost of vacant home insurance can also vary depending on the coverage you choose. For instance, you may be able to add coverage for other structures on the property, such as a detached garage or shed. You can also opt for personal property coverage for belongings you keep on the premises, such as a lawnmower or maintenance tools.

When purchasing vacant home insurance, it's a good idea to get quotes from multiple insurers to find the best price for the coverage you need. Some insurers may offer discounts if you bundle insurance products or install safety features like security systems and deadbolt locks. Additionally, keeping the property well-maintained and regularly monitored can help reduce the cost of vacant home insurance.

How to buy vacant home insurance

If you own a vacant home or plan to leave a home vacant, you should consider purchasing vacant home insurance to protect your property and give you peace of mind. This type of insurance is a specialty product that covers claims that would otherwise be denied by standard homeowners insurance policies. Here are the steps to buying vacant home insurance:

• Determine if you need vacant home insurance: The first step is to find out how long your home can be unoccupied before it's considered vacant by your insurance company. Typically, a home is considered vacant after it has been unoccupied and empty for 30 to 60 days. If you plan to leave your home vacant for an extended period, you will likely need vacant home insurance.
• Check with your current insurance provider: Ask your insurance provider how they handle vacant home coverage. Some companies allow you to add coverage to your existing policy, while others require a separate policy.
• Shop around and compare quotes: Don't be afraid to explore other insurance companies to find the best coverage and price. Consider factors such as deductibles, coverage limits, and the length of time you need the vacant home insurance.
• Apply for vacant home insurance: Gather the necessary documents, such as proof of ownership, the estimated value of the home, and the estimated time it will be vacant. Then, finalise your vacant home policy or add the endorsement to your current policy.

It's important to note that vacant home insurance is generally more expensive than standard homeowners insurance, often costing around 50% to 60% more. This is because vacant homes are considered higher risk by insurance companies due to increased vulnerabilities to theft, vandalism, and other damage.

Frequently asked questions