Unoccupied Home Insurance: What You Need To Know

Unoccupied and vacant home insurance are specialty insurance products that protect homes that are uninhabited for an extended period of time. This type of insurance is necessary because standard homeowners insurance policies typically do not cover claims on vacant properties, due to the increased risks of theft, vandalism, and other types of damage. Vacant homes are defined as those with no belongings inside and are not being lived in, while unoccupied homes are those that are ready to be used as a residence with furniture in place and utilities set up. The cost of vacant home insurance is generally higher than that of unoccupied home insurance, as vacant homes are considered a higher insurance risk.

Unoccupied vs vacant homes

When a house is empty for an extended period, it may not be covered by a standard homeowners insurance policy. This is where unoccupied and vacant home insurance comes in. But what's the difference between unoccupied and vacant homes?

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 completely empty (or close to it) and typically has its utilities turned off. On the other hand, an unoccupied home has enough furniture and appliances that someone could come back and live in it at any time. The utilities are usually still connected in an unoccupied home.

The determination of whether a house is vacant or unoccupied has a significant effect on insurance rates. Vacant homes pose a higher risk to insurance companies than unoccupied homes. This is because claims for unoccupied homes are likely to be reported sooner, resulting in less severe damage and lower costs.

If you plan to leave your home vacant or unoccupied for 30 days or more, you should consider purchasing vacant or unoccupied home insurance. Most insurance companies will deny claims if your home is left alone for longer than 30 days. It's important to speak to your insurer about their specific definitions and restrictions regarding vacancy and unoccupancy.

Vacant home insurance typically covers damage to the structure of the home from events such as fire, lightning, wind, hail, and explosions. Policies may also include coverage for theft, vandalism, and personal liability. For example, if someone breaks into a vacant home and vandalises it, vacant home insurance would cover the damage.

The cost of vacant home insurance is generally higher than a standard homeowners policy due to the increased risk. On average, vacant home insurance costs about 50%-60% more than a standard policy for an occupied home. The cost depends on factors such as the amount of coverage, the location of the home, and the home's risk profile.

When is unoccupied home insurance needed?

Unoccupied home insurance is needed when a home is left empty for longer than a standard insurance policy will cover. Standard policies typically cover a home for up to 30 or 60 days of vacancy, after which the homeowner may need to purchase unoccupied home insurance. This type of insurance is designed to provide financial protection from damage or loss of a home that is uninhabited.

There are many reasons why a home may be left unoccupied for an extended period. For example, you might need unoccupied home insurance if:

• You own a vacation home that you only visit a few times a year.
• You've purchased a new home but won't be moving in for several weeks.
• You're constantly travelling for weeks at a time.
• You're undergoing medical treatment that requires hospitalisation for weeks.
• You're renovating a home and are not living there during the process.
• You're renting out a home and are in between tenants.
• You've inherited a home but don't plan to move in right away.

Unoccupied homes are more vulnerable to theft, vandalism, and other types of damage. For instance, a burst pipe could cause significantly more damage in an unoccupied home than an occupied one because no one is there to catch it and turn off the water supply. As a result, insurance companies consider unoccupied homes to be a greater insurance risk and exclude them from standard property insurance policies.

If you expect your home to be unoccupied for longer than a month or two, it's important to contact your insurance company to discuss your options. You may need to purchase a separate unoccupied home insurance policy or add an endorsement to your existing policy.

How to get unoccupied home insurance

Unoccupied home insurance is a type of specialty insurance product that provides financial protection from damage or loss to a home that is uninhabited. This type of insurance is necessary because typical homeowners insurance policies won't cover fire, vandalism, liability, or other types of claims on an unoccupied property.

Determine if you need it

Before purchasing unoccupied home insurance, check with your current homeowners insurance company to understand their definition of "vacant" or "unoccupied" and how long you can leave your home unattended before needing additional coverage.

Check for existing coverage options

Talk to your current homeowners insurance company to see if they offer unoccupied home insurance or a vacancy endorsement that can be added to your current policy for an additional fee.

Shop around and compare insurers

If your current insurer doesn't offer unoccupied home insurance, you'll need to purchase a separate policy. Compare different insurers and their coverage levels, prices, quality of cover, excess, and customer feedback to find the best option for your needs.

Choose your policy and pay premiums

Once you've selected a policy, you'll typically need to pay the premiums upfront in full. Most insurers will reimburse you for the remaining months if you cancel the policy before the end date.

Take steps to keep your unoccupied home safe

To protect your empty home, consider the following:

• Maintain the yard and landscaping to make the home appear occupied.
• Beef up security with strong locks and consider installing an alarm system.
• Use smart home devices like water leak sensors, smart smoke alarms, and doorbell cameras to monitor the property.
• Have someone regularly check on the house and set up a timer for interior lights to give the appearance of occupancy.
• Prevent frozen pipes by setting the thermostat to at least 55 degrees Fahrenheit and shutting off the main water supply.

By following these steps, you can ensure that your unoccupied home is properly insured and protected.

How much does unoccupied home insurance cost?

The cost of unoccupied home insurance can vary depending on the insurance provider and the policy. The average price of cover for homes that are empty for 31 to 60 days is £133. However, the exact cost for insuring an unoccupied home can be higher or lower depending on various factors. These factors include the property value, location, security, maintenance, and the level of coverage desired. Improving the security features and maintaining good property maintenance, such as insulating water pipes during winter, can help prevent burglaries and reduce the cost of insurance.

Unoccupied homes are considered higher-risk properties compared to primary residences, leading to higher insurance rates. Vacant or unoccupied homes are more likely to be targeted by intruders and are more susceptible to damage, such as leaks, burst pipes, fires, and undetected mold. Additionally, the location of the home can impact insurance rates, with vacation homes often located in higher-risk areas prone to flooding, hurricanes, or forest fires.

When considering unoccupied home insurance, it is essential to compare quotes from multiple insurers to find the best price and coverage that meets your specific needs. Some insurers may offer short-term policies, while others provide policies with a 12-month duration. It is also important to review the policy documents carefully before purchasing to ensure you understand what is and isn't covered.

How to save on unoccupied home insurance

Unoccupied and vacant home insurance are specialty insurance products that provide financial protection from damage or loss to a home that is uninhabited. This type of insurance is necessary because typical homeowners insurance policies won't cover fire, vandalism, liability, or other types of claims on an unoccupied or vacant property.

Have someone regularly check on the property:

Ask a neighbour or friend to stop by your home every few days to check on it. If you do this, your insurance company may not consider your home as unoccupied or vacant, which could result in lower insurance rates.

Install security measures:

Consider installing security measures such as an alarm system, smart-home devices (e.g. water leak sensors, smart smoke alarms), and motion sensor lights. These measures can help deter intruders and reduce the risk of damage, which may earn you a discount on your insurance.

Shop around and compare quotes:

Don't be afraid to shop around and compare quotes from different insurance companies. Consider factors such as monthly costs, deductibles, and coverage limits when deciding on a policy.

Discuss discount opportunities:

Talk to your insurance company about potential discounts. For example, if you have security measures in place or if someone is regularly checking on the property, you may be eligible for a lower rate.

Shorten the unoccupied period:

The longer a home is unoccupied, the higher the insurance rates are likely to be. If you can shorten the period that your home is unoccupied, you may be able to get a lower rate.

Choose the right coverage:

Only select the coverage options that you need. For example, if you're only going to be away for a short period, you may not need coverage for certain risks such as major structural damage.

Remember that the methods outlined above may be assessed on a case-by-case basis by insurance companies, and there is no guarantee of a discount. However, discussing these options with your insurance provider and taking proactive measures to secure your property can potentially save you money on unoccupied and vacant home insurance.

Frequently asked questions