Unoccupied and Vacant Home Insurance
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When a home is left empty, it becomes vulnerable to various risks, from vandalism to environmental damage. Standard homeowners insurance may not cover these risks, leaving property owners exposed. This is where unoccupied and vacant home insurance comes into play, offering a safety net for homes that do not have regular occupants.
Related: Homeowners Insurance Calculator
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What is unoccupied and vacant home insurance?
Unoccupied home insurance and vacant home Insurance are specialized forms of coverage designed for homes that are left empty for extended periods, such as second homes and vacation homes. Unoccupied homes are left empty but intend to be occupied again by the owner, whereas a vacant house is empty, without any personal belongings inside. Vacant homes could also be empty for a period of time as occupants have left a primary residence for a new home and are seeking to sell the vacant home. These vary from standard home insurance policies and require different coverage needs for your personal property and beyond.
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Costs of unoccupied and vacant home insurance
The cost of unoccupied and vacant home insurance varies depending on several factors, including the location of the property, its value, and the length of time the home will be unoccupied or vacant. Generally, these policies are more expensive than standard homeowners insurance due to the higher risks associated with empty properties.
On average, unoccupied and vacant home insurance policies can be anywhere from 50% to 60% more expensive than standard homeowners insurance policies. To put this into perspective:
- For a standard homeowners insurance policy. The national average cost might be around $1,200 annually for a home insured for $250,000 in dwelling coverage.
- For an unoccupied or vacant home insurance policy. The premium for the same home could increase to between $1,800 and $1,920 annually.
Features of the unoccupied and vacant home insurance
Unoccupied and vacant home insurance policies are crafted to address the unique risks associated with properties that are not currently inhabited. These policies encompass a variety of coverages, each serving a vital role in safeguarding the property and the financial interests of the homeowner.
Property damage
This core aspect of unoccupied and vacant home insurance covers the repair or replacement costs arising from damage to the property due to a wide range of perils, such as:
- Fire and smoke damage. Protects against one of the most common and destructive forces, ensuring homeowners can rebuild or repair after a fire.
- Weather-related damage. Coverage extends to natural events, including lightning strikes, windstorms, hail, and, in some cases, the weight of snow or ice. These weather phenomena can cause significant damage to structures, particularly when no one is present to take immediate action.
- Water damage. Some policies may offer limited coverage for water damage, such as from burst pipes, which is a risk in unoccupied homes during cold weather. However, it's important to note that flood damage typically requires a separate policy.
Liability insurance
Liability coverage is crucial for protecting the homeowner from financial loss if someone is injured on the property. This can include:
- Medical bills. If a visitor or trespasser gets hurt on the property, this coverage can help pay for their medical expenses.
- Legal defense and settlements. Should an injured party file a lawsuit, liability protection can cover legal fees and any settlements or judgments against the homeowner.
Vandalism and malicious mischief
Vacant and unoccupied homes are more susceptible to vandalism, making this coverage essential. It includes protection against:
- Graffiti and property defacement. The cost of cleaning, repainting, or repairing the property following acts of vandalism.
- Break-ins and theft. While traditional homeowners insurance might limit coverage for theft in vacant homes, specialized policies can offer broader protections for stolen fixtures or property damage resulting from a break-in.
Additional considerations
Beyond these fundamental coverages, homeowners should also consider additional protections that might be pertinent to their specific situation, such as:
- Glass breakage. Coverage for windows and glass doors, which are often targets for vandals.
- Building ordinance or law coverage. If local building codes have changed since the home was built, this coverage can help cover the cost of bringing the property up to current standards during repairs.
- Loss of rent. For landlords, some policies might offer compensation for lost rental income if the property becomes uninhabitable due to a covered peril.
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Companies offering unoccupied and vacant home insurance
Several reputable insurance providers specialize in providing coverage for unoccupied and vacant home insurance. Here are four home insurance companies that stand out for their offerings in this specialized insurance market.
Foremost Insurance Group
Foremost Insurance Group is a leading provider of insurance for vacant and unoccupied homes, offering comprehensive policies tailored to meet the unique needs of homeowners. With a focus on flexibility, Foremost allows policyholders to choose the coverage that best fits their situation, whether their home is temporarily vacant during a move, undergoing renovations, or on the market for sale. Their policies cover a wide range of perils, including vandalism, which is a common concern for vacant properties. With decades of experience and robust backing by the Farmers Insurance Group, Foremost stands out for its specialized knowledge and customer service excellence in this niche market.
American Modern Insurance Group
Specializing in non-standard insurance products, American Modern Insurance Group offers robust solutions for vacant and unoccupied homes. Recognizing the unique risks faced by these properties, American Modern provides comprehensive coverage options that include protection against vandalism, fire, theft, and certain types of water damage. Their policies are designed to offer peace of mind to homeowners, whether they own a secondary property that's currently unoccupied or are in the process of selling a vacant home. American Modern is known for its customizable coverage options, making it easier for homeowners to tailor their policies to their specific needs.
Allstate Insurance
Allstate, one of the largest insurance companies in the United States, offers specialized policies for vacant and unoccupied homes through its "Landlords Package Policy" for rental properties and a separate policy for vacant homes. These policies are designed to protect properties that are not currently inhabited, offering coverage for vandalism, glass breakage, and liability, among other risks. Allstate's extensive network of agents provides personalized service, helping homeowners navigate their coverage options and find the best solution for their empty homes. With Allstate's reputation for customer service and comprehensive coverage, homeowners can feel confident in the protection of their vacant or unoccupied property.
Farmers Insurance
Farmers Insurance offers specialized vacant home insurance policies designed to protect homes that are empty for various reasons, such as transitions between tenants, renovations, or pending sales. Understanding that vacant homes carry different risks than occupied ones, Farmers provides coverage options that include vandalism, liability, and loss from fire or storm damage. Their policies are flexible, with terms that can be adjusted to match the temporary or longer-term needs of the homeowner. With Farmers Insurance, policyholders benefit from the company's extensive experience and commitment to providing tailored insurance solutions for the unique challenges of insuring vacant and unoccupied homes.
Related: Best Homeowners Insurance
FAQs
How long can a home be empty before needing this type of insurance?
Most standard policies cover an empty home for 30 to 60 days. Beyond that, unoccupied and vacant home insurance is needed.
Is this insurance mandatory?
While not legally mandatory, many mortgage lenders require it as a condition of the loan for homes that will be empty for extended periods.
Can I get a policy for a short-term vacancy?
Yes, insurers offer policies that can cover short-term or longer vacancies, depending on the homeowner's needs.
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- Rates subject to qualification and approval
Pros and cons
Pros
- Comprehensive protection. Offers specific coverages not typically included in standard homeowners policies.
- Flexibility. Policies can be tailored for short-term or long-term needs.
Cons
- Higher costs. Due to the increased risks, these policies are generally more expensive.
- Exclusions. Certain causes of damage may be excluded, requiring a careful review of the policy.
The bottom line
Unoccupied and vacant home Insurance fills a critical gap in protecting properties that are at increased risk due to their empty status. While the costs may be higher, the peace of mind and financial protection it offers make it a valuable consideration for property owners. It's essential to assess your needs, understand the terms and conditions of the policy, and choose coverage that provides the right level of protection for your unoccupied or vacant property.
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