If you own a house in which you no longer reside, then you need to know about vacant home insurance. It may be tempting to leave a house vacant without notifying your existing insurance agent of the change in the home’s status. However, doing so may put you and your property at risk, since many policies actually have exclusions for neglect or abandonment. The exclusion kicks in 30-60 days after the home has been left vacant.
Some insurance companies will offer what is called an endorsement which must be purchased. After the home is considered vacant, homeowners can buy back the exclusion. It usually costs under $100, but many insurance companies lack this option.
Vacant houses have more liabilities associated with them because:
- No one lives there.
- They are more susceptible to fire, weather and vandalism.
These two facts cause a wide range of liabilities for the house. First of all, since no one lives there, there is usually not someone who is using the A/C, watering the lawn or caring for the home on a regular basis.
Additionally, vacant houses are more susceptible to dangers such as vandalism, weather damage and fire since there is no one to care for the immediate needs of the house or watch over it.
What coverage is offered on a vacant home policy?
- Named Peril Coverage – Named Peril Coverage is exactly what is sounds like – coverage that is only for losses caused by the dangers specifically listed as being covered. In other words, it contrasts with “all risks coverage”, which applies to loss from all causes not specifically listed.
- Vandalism & Malicious Mischief Coverage
- Liability Coverage
- Agreed Loss Settlement (Total Loss)
- Actual Cash Value (Partial Loss)
What Should You Do?
If you own a vacant home, you need to have it insured. However, ultimately, it is in your best interest and in your neighbor’s best interest to have the house occupied. Vacant houses tend to drive down prices in neighborhoods and present risks both to you and your neighbors.
Another option is to sell the house. Many of the houses we buy are left vacant. Sometimes, families move before they are able to fix up the house and sell it. While they have good intentions, many people just want to move on after moving. Many people leave houses vacant after a family member dies and no one moves into the house, and this is a very common reason people sell their houses to Big State Home Buyers.
If you have questions about what to do with your vacant house, give us a call. We will answer your questions with no obligation!