Insuring a Vacant House: Protecting Your Financial Interests

Insuring a Vacant Home in CaliforniaYou have a perfect home yet have no choice but to leave it. Whether leaving is temporary and you intend to come back, or you’re looking to sell the property in the future, you may want to review your homeowner’s insurance coverage and look at the fine print on your policy.

You will run into more problems and bigger risks the longer the house remains empty. This is because insurance companies usually offer very limited or no coverage for vacant homes. Now that you’ll be living there, it pays to have a second look. Here’s what you should look for.

Reducing Risks

What constitutes an empty house varies from one carrier to another. A common definition is that there are no owners or tenants who live there and almost all furnishings have been removed. Insurers limit the coverage of these types of homes because they pose the greatest risks of deteriorating or being vandalized.

Without regular maintenance and use, furnishings tend to depreciate beyond normal wear and tear. These types of homes may have very little – if any – protection from certain perils and damage, such as fire and smoke, as no one lives in the house to deter or report emergencies.

Vacant Home Insurance

You must check immediately with your insurer if it will continue to insure your vacant home. If your current policy gives very little to no protection at all, and you really need to leave or empty your home, it may be best to look for another or an additional property coverage.

Whether you need it for the short or long term, a vacant home insurance will protect your financial interests from many threats, including vandalism, theft, and fire. Make sure that your new policy protects you if a person has been injured on your vacant property.

If you intend to come back or sell the property, it’s important to keep the home fully insured and free of vacancy penalties to reduce the risks. Such risks may delay the sale by months and may result in bigger losses, such as break-ins, water damage, and so on. Given the dry weather and prevalence of wildfires in California, urges homeowners to purchase coverage for fire losses.

If you simply can’t avoid leaving your home, it’s best to keep it occupied at least, by a short-term tenant or caretaker, or have a friend care for the property or check on it from time to time. But if you really want to safeguard your finances, it’s best to look for carriers that specifically insure vacant or unoccupied homes.