Vacant home insurance : What does it cover ?

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Planning to leave your home empty for an extended period? Your home insurance might be at risk.

Although many homeowners do not realize it, leaving your home for weeks or months at a time can cause your insurance company to discontinue coverage on the home.

That means your coverage could be at risk for something so simple as leaving it unoccupied when you are trying to sell it or having to vacate the home for a few weeks during renovation work.

Talk to your insurance company if you will be away from your home for 30 or 60 days, or longer, says Loretta Worters, vice president of media relations for the Insurance Information Institute.

“Considering buying vacant home insurance coverage,” she says. “That way, if damage occurs and goes unnoticed for a while, you will still be protected.”

What is vacant home insurance?

Purchasing a vacant home insurance policy ensures that your home is covered for damages should something happen while you are away from the home for an extended period.

Some insurance companies will not insure your home if it is left vacant for a long time, the Insurance Information Institute says. That could put you in financial jeopardy.

“Any damages or losses that occur would have to be paid out of pocket,” Worters says.

By purchasing unoccupied home insurance, you protect what is likely your biggest investment — your home — when you are not around.

Often, home insurance companies will give you a window in which a house can be vacant, such as 60 days. Some insurers may only allow a vacancy of 30 days.

After that time has elapsed, the insurer might reserve the right to cancel your home insurance policy.

Home insurers will often work with you if you have a special situation — for example, if you bought a new house and are waiting to sell your vacant house, but are still checking in on it. Contact your insurance company to learn its policies for vacant homes so you can be sure your home is covered when you are not there.

Key Takeaways

Leaving your home vacant for 30 or 60 days can put your homeowners insurance coverage at risk.
A vacant home insurance policy can offer protection from some types of damage that might occur while you are away from the home.
The cost for this coverage can be considerably higher than what you would pay for a standard homeowners insurance policy.

What does vacant home insurance cover?

A vacant dwelling insurance policy covers many of the things you would expect any homeowners policy to protect. If your home burns down or is damaged in a windstorm, you will be covered. Damage from hail, lightning and even an explosion typically would be covered.

However, there may be some coverage exceptions, especially around types of damage that can get worse if not reported right away. Thieves and vandals can have run of a property that is unoccupied for a long period of time. A burst pipe can cause enormous water damage if no one is there to spot and stop the problem.

For this reason, these types of damage may be excluded from a vacant home insurance policy. In some cases, an insurer may offer riders that you can purchase at an extra fee to make sure you are covered from these types of events.

How much does vacant home insurance cost?

The potential risks to your home only increase when it is vacant. For example, a burst pipe or leaky roof covered in melting snow can wreak havoc on a home when nobody is around.

“The resulting damage is likely to be worse because no one is around to report it or stop it,” Worters says.

Because of that reality, vacant home insurance cost is likely to be higher than what you would pay for standard home coverage. In fact, an insurer might charge you 50% to 60% more to insure a vacant home, according to the Insurance Information Institute.

Worters notes that asking for someone to keep tabs on your property might result in a lower premium. Ask your insurance company to be sure.

In addition, Worters says you might get a lower rate if your home has extra protections, such as:

A central alarm system
Deadbolt locks
Smoke detectors
Winterization of the home to protect plumbing fixtures from freezing weather

While insuring a vacant home typically is more costly than covering an occupied home, there may be exceptions to that rule. For example, some insurers may deem a vacant home to pose a lower liability risk than an occupied home. In such instances, you might actually save a little money when insuring a vacant home.

Who might need vacant home insurance?

If you know that you are going to leave a home vacant for at least 30 days, call your insurer and find out whether you need to purchase unoccupied property insurance.

“If you leave your home unattended for more than 30 days, your homeowners policy likely won’t provide coverage in the event of a claim during the time it is unoccupied or vacant,” Worters says.

There are many instances in life when a home could be vacant for several weeks or longer. These include:

Periods after you move but have not yet sold your house
Long renovations that require you to temporarily relocate
Vacancies that occur when you are between tenants in a rental home you own
A time when you are selling a home as an executor of an estate

In some cases, you might not need vacant home insurance. If your home is only going to be vacant for a short period – such as for a season, or during a time when you are between renters – some insurers might offer an endorsement to your regular homeowners insurance policy that will cover you until the home is occupied again.

However, in other cases, you will need to purchase a separate vacant home insurance policy. Whatever the situation, make sure your home has insurance coverage. Remember that even if a home you own is vacant, that does not mean you are not responsible for what happens to the home or to people who are on the property site.

What are the best vacant home insurance companies?

Although some insurers are reluctant to sell vacant home insurance policies, others offer this coverage.

The best vacant home insurance company is the one that meets your needs, both in terms of price and coverage. Several insurers sell such policies, including:

American Family Insurance

American Family Insurance offers a basic vacant home insurance coverage policy that can be expanded to add coverage for personal property. Policies are available in lengths such as three-, six- or 12-month terms.

American Modern Insurance

American Modern Insurance offers a policy that covers losses due to fire, lightning, wind, hail, explosion and others. Actual cash value coverage is available that considers depreciation when settling your claim. Policies are available for three, six and 12 months.

Farmers Insurance

Farmers offers a 12-month policy that has an option to prorate the cost if you cancel early. Extra coverage is available to protect you from damage associated with vandalism or malicious mischief.

Foremost

Offers a one-year policy that can be renewed for up to four years. Homes valued up to $1 million are eligible for coverage. It offers prorated cancellation.

How to shop for vacant home insurance?

Before you purchase vacant home insurance, make sure you need it. Ask your home insurer how long you can leave your home vacant before the company no longer will cover your claims.

If you discover that you require vacant home insurance, ask if you can obtain it with a simple rider to your current homeowners policy. If that is not an option, you will probably need to purchase a separate vacant home insurance policy.

Don’t simply immediately purchase a vacant home insurance policy from your current insurer. Instead, use this as an opportunity to shop around. While your current insurance company may indeed be your best option, it never hurts to compare rates and coverages from different companies.

Remember that while a low price is important, it should not be the only factor in your decision-making process. Ask the insurance companies in which you are interested exactly what their vacant home insurance policy does – and does not – cover. That way, you can find the policy that is the best fit for you.

Frequenly asked questions

How long can a house be vacant for insurance?

The length of time that a home can be vacant and still remain insured varies from insurer to insurer. Some companies may allow the house to be vacant for up to 60 days, but many restrict the period to just 30 days.

Because policies vary, it is important that you talk to your insurer so that you will know exactly how long your home can be empty before your coverage is in jeopardy.

Is there a difference between vacant and unoccupied?

Although definitions differ from insurer to insurer, there usually is a difference between a “vacant” home and an “unoccupied” home.

A vacant home is one in which the house is empty. No one lives there, and all or most of the furnishings have been removed. By contrast, an unoccupied home typically is one where everything in the house is left in place as if the owners or tenants expect to return.

Insurers generally are more reluctant to cover a vacant home than an unoccupied home. But do not assume that you can simply leave your home unoccupied for a long period under the assumption that it will be covered. Make sure you clarify coverage terms with your insurer.

Does vacant home insurance cover renovations?

Whenever you renovate your home, it is important to know-how upgrades will impact your homeowners insurance coverage, Worters says.

“if you’re putting an addition onto your home and increasing its square footage, your existing homeowners policy may not provide enough coverage,” she says.

When adding to your home, you should always contact your insurance company. “The same would apply if the house were vacant,” Worters says.

Chris Kissell

Contributing Researcher

Chris Kissell is a Denver-based writer and editor with work featured on U.S. News & World Report, MSN Money, Fox Business, Forbes, Yahoo Finance, Money Talks News and more.