The Importance of Being Covered
While any home with or without vacancy can incur damage, one without occupants for a prolonged period of time is especially at risk. That’s because there tends to be a higher potential for three main problems. First, an empty home can be a target for vandalism. Whether it’s just kids partying or professional thieves looting a property, a vacant home if often a magnet for mischievous activity.
Second, damage from perils can be devastating. For example, if a home catches fire without anyone there, it could easily spread, and more damage is likely to occur than if people were living there. Perils also include other dangers such as lightning, hail, wind, flooding, etc. With a lower probability of emergency response intervening, a minor problem can quickly escalate into a major disaster.
Third, you often have more liabilities when there is a vacancy. If someone is injured on the property and you are found to be legally responsible, this could lead to an ugly lawsuit. Even if someone shouldn’t have been there in the first place, you can still be at fault and a case could be brought against you. Accordingly, it’s a good idea to have vacant home insurance and adequate coverage for your specific situation.
Criteria for Vacant Home Insurance
Although there can be a plethora of scenarios, here are a few where insurance would be a good idea.
- You will be moving out of your old home and into a new one. Your old home will be sitting vacant for an extended period of time until it’s sold.
- You purchased a new home that needs fairly extensive renovation. You will be living in a different home until they are completed, and the new home will be sitting vacant.
- You own a rental property that’s left vacant between tenants.
- You inherit a home, and you are either selling it or waiting to move in while you sell your current home.
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Consequences of Not Having the Right Policy
Like most other types of insurance, there are a variety of polices that offer different amounts of coverage. Consequently, it’s important you not only get vacant home insurance, but also find the right policy for your specific needs. Without the correct policy, there are a few negative consequences you could experience.
- Paying out of pocket to cover repairs from vandalism if your policy doesn’t cover it.
- Paying extra for an annual policy when you only need coverage for a few months.
- Being forced to continually renew your policy if it doesn’t cover the necessary length of time.
- Losing money because of a total loss situation.
At Obrella, we know everyone has unique circumstances, and it’s not always easy to tell which type of policy is best. That’s why we recommend you talk to licensed experts who can help understand renters insurance options and provide you quotes.
With the inability to keep constant watch over an empty home, being vacant leaves it more vulnerable than a home with occupants.
For your home to be eligible for coverage, it must meet certain requirements. The first is to meet the definition of being a property without contents or occupants. In terms of home value, many insurance providers will accept vacant homes up to $1 million. However, some will only go up to $500,000. If your home exceeds $1 million, it’s unlikely you’ll be able to find coverage. You should also know insurance doesn’t just apply to traditional homes; other properties, like townhouses and condominiums, are often eligible as well.
The bottom line is that insuring a vacant home is smart in most cases. With all of the risks and potential liabilities, it just makes sense for homeowners in this type of situation. If you’re concerned about your empty home, then it’s a good idea to look further into getting it insured and see what your options are.