Can insurance companies cancel your policy if your home is vacant?

Most homeowners insurance policies cover a vacant home for 30 to 60 days. After that window closes, your insurer can limit your coverage, deny claims or cancel your policy entirely. Vacant homes carry more risk, since there’s no one around to catch a fire, a break-in or a burst pipe before it turns into serious damage.

Insurers do this because claims on empty houses cost them more. A pipe that bursts in an occupied house gets shut off in minutes. The same pipe in an empty house runs for weeks, soaking drywall, flooring and framing before anyone opens the door. Fire, vandalism and theft follow the same pattern — nobody is there to catch the problem while it’s still small and cheap to fix.

If you know your home will sit empty longer than that, whether through a slow sale, a renovation or a long-term move, you need to notify your insurer or add a vacancy endorsement (an add-on that extends coverage for vacant homes past the standard 30- to 60-day limit).

What is the difference between a vacant and an unoccupied home?

A vacant home has no people and no personal property inside. An unoccupied home still has the furniture, the clothes and everything else in place — the owner just isn’t living there right now.

Unoccupied homes keep full coverage under your standard policy. Vacant homes don’t. Once a vacant home passes your policy’s 30- to 60-day limit, the vacancy clause drops coverage for vandalism, theft, water damage and broken glass, and your insurer can cancel or non-renew you.

So a snowbird gone five months with the furniture in place is unoccupied and keeps full coverage. A homeowner who empties the house into storage for a two-month renovation is vacant from the first day, and 60 days in, a break-in or a burst pipe is no longer covered.

What kind of insurance do you need for a vacant home?

If your home will be empty longer than your policy’s vacancy window, you need vacant home insurance or a vacancy endorsement. Both fill the coverage gap your standard policy leaves once the vacancy clock runs out, but they cover less than a standard policy does.

A vacancy endorsement extends your existing policy’s protection for a set period beyond the standard 30- to 60-day limit. Vacant home insurance is a separate, standalone policy built specifically for empty properties, generally the better option if you know the home will be vacant for a long stretch, like during a slow sale or a major renovation.

Vacant home insurance covers:

• Fire damage
• Wind
• Explosions
• Lightning
• Hail

It does not cover the full range of perils a standard homeowners policy does. Water damage, theft, and vandalism are commonly excluded or limited, so check your specific policy for what’s left out.

Below is a breakdown of what each policy covers:

How can you protect a vacant or unoccupied home?

Reduce risk by making the home look and stay lived-in, and by keeping your insurer informed. Empty homes are easier targets for theft, vandalism and squatters, and small problems like a leak or a pest issue can go unnoticed for weeks with no one there to catch them. Most insurers expect some of these steps if you file a claim on a vacant property, so they double as ways to protect your coverage, not just your home.

• Set up a security system. Remote monitoring and motion detectors deter intruders and alert you to suspicious activity in real time.
• Arrange regular check-ins. Ask a trusted friend or neighbor to check the property, or hire a property manager for longer absences.
• Keep up exterior maintenance. Lawn care, snow removal and general upkeep keep the home from looking empty.
• Shut off the water supply. This prevents water damage from leaks or burst pipes, one of the most common vacant-home claims.
• Use timers for lights. Indoor and outdoor lights on a timer make the home look occupied in the evening.
• Secure windows and doors. Lock all entry points and consider reinforcing them with deadbolts or security bars.
• Unplug unnecessary electronics. This lowers fire risk and cuts energy costs while no one’s using them.
• Forward your mail. A pile of mail or packages is one of the clearest signs a home is empty.

 

Related Articles