Many homeowners’ insurance policies do not protect the home after you have moved out. Insuring vacant homes should be handled thoughtfully. Most areas of the U.S. are currently enjoying a strong real estate market and leaving a home empty while it is for sale is less likely to occur. However, should there be a time when the family moves out and the home is listed for sale – or is vacant for any other reason – most home insurance policies no longer protect the home.
Insuring a vacant home is different than an occupied one. Many issues compete for a homeowner’s attention when it comes to selling. Among moving plans, address changes, and securing a new residence, it is understandable insurance gets pushed aside. However, homeowners’ insurance policies are designed to protect occupied homes. Vacant homes, even those visited by realtors or contractors, are at a higher risk of damage, and claims are more likely to be filed. Statistics bear this out.
Risks of Vacant Homes
For example, when occupied, a broken water supply line will be noticed quickly and, although damage may occur, the homeowner will work to limit harm and contain the issue. However, in a vacant home a broken water supply line could leak for days and cause significant destruction. The same is true for the heating system. In wintertime if heat goes out while the owner is home, they will notice it and use a secondary system to warm themselves and keep pipes from freezing. But if the home were vacant every pipe could burst and no one notice until it was too late. The same is true of many other claim types. Damage that would be limited while the home is occupied is more serious when vacant.
Most home insurance policies protect the “resident premises” which is defined as the dwelling where the owner resides. Should the owner no longer reside there, the home is no longer a “resident premises” and therefore no longer protected. Insurance policies vary, but most exclude or limit damage while a home is vacant in one manner or another.
Proper Protection
If the home is occupied by the owner while it is listed for sale, insurance coverage does not change. Similarly, there is no reason for alarm if you are absent from your home for brief periods due to vacation or other temporary living conditions. However, if the owner no longer resides at the home, contact your insurance agent. Examples in need of special consideration include:
- Secondary homes
- Rentals, whether seasonal or permanent
- Vacant
- Homes under construction or renovation (builders risk)
- Home sharing such as Airbnb or VRBO
Home insurance companies insure homes in these situations in a variety of manners, but rest assured insurance is available. Talk to your insurance agent about insuring a vacant home and reference these other resources for more information:
Questions on insuring a vacant home? Contact your Bankers Insurance agent. We will help determine your risks and advise how to best cover them. Not a client of ours? Let us earn your business! Each of our clients is assigned a personal insurance agent and provided their email address as well as a phone number that rings right on their desk.
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I need Janet to call me sometime next week on my cell 770-0606 about insurance on our 2doors down house.
Thanks
Linda Gnewikow
Absolutely. I just passed your request on to Janet.