Homeowner's insurance for vacant homes

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ceemike

ceemike

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Joined
Nov 19, 2009
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607
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Pennsylvania
We're in the process of selling my DW's mother's house.  She has moved to an independent living facility.  Our realtor told us that, since the house is now vacant, we need to add vacant house coverage to the MIL's HO policy.  She warned us about this because another agent had a client whose vacant house was stripped of its copper & the HO insurer wouldn't cover the theft because the house had been vacant for more than 30 days.  The HO insurer doesn't cover vacant houses so they cancelled the policy.  The cost to insure a vacant house is about 4 times the cost of the regular HO insurance. 

I'm asking this because I was wondering if any Forum members who still own stick houses but leave them vacant to travel for months at a time have ever been told they need special insurance to cover their houses while the houses are vacant.

Mike Wagner
 
I was told the same thing. I found the cost prohibitive and just take my chances but I never intend to live in it again. If I return to a homebase, I plan to push it over and rebuild so I am not overly concerned about it.
 
Vacant and "on vacation" are two different things. Usually the trick is whether the utilities are on or not.

If you have a furnished home and are on vacation, your homeowners would not stop. That would be ludicrous. The fact that you are gone for an extended length of time should not be a factor. What about people who have two homes, one being their lake house?

Now, I suppose there could be a disclaimer in your policy to cover such contingencies, but that's on a per policy basis.

In your particular case, however, I suspect the fact that the "owner" of the house, your mother, has moved to another place and would not be coming back triggered your realtor's concern. There usually is a problem with a home not being occupied and having standard homeowners insurance on it, often the case when a home is being sold and the owner has taken up residence elsewhere. It's a fine line and the exact circumstances are the key. And not every insurance company treats those circumstances the same.

Talk to the insurance guy, not the realtor, to get the final answer.
 
Another major concern with vacant houses is that squatters sometimes move in and set up.  They can do a lot of damage which needs to be covered.  I heard recently about one in which the squatters set up a meth lab.  Not good!

ArdraF
 
Skyking4ar2's thoughts are correct - vacant and vacation (even extended) are 2 different issues. In your situation, the house is vacant. All homeowners policies will have a vacancy clause (with a specific definition of "vacant") and will deny coverage typically after 30 days of vacancy. Yes, talk to your insurance agent - he/she may be able to get you what's commonly called a "Fire Policy". It will still be more expensive but will at least provide you with Liability protection and basic Property coverage for catastrophic losses such as fire, lightning, wind/hurricane, and possibly rain damage. It will probably exclude coverage such as vandalism and frozen pipes.

Joe
 
About 5 yrs back we purchased the home we live in now and moved out of the one we had up for sale. All utilities were on and real estate people were in it weekly, not to mention us in it every other day or so. (We only moved 1 1/2 miles away). RE folks like to sell houses that way, minimal furniture etc but insurance dropped us in about 2 weeks so be prepared. Call around and get prices as our ins. cost doubled and we had to scramble to get another company right away. Once you have other options then call your agent and discuss so you're not dropped etc without warning.
 
If you have the energy and time you can search court cases resulting from claims denied because home were "vacant". Most insurance policies are pretty vague (deliberately so?) regarding the definition of vacant. In general a home is vacant if you could not unlock the doors and start living in it nearly immediately. That would mean furniture, working appliances, etc. Because we are only in our stick and brick for the coldest months, I persisted until I got a definition in writing regarding our coverage on the stick and brick. The MIL's house that has been moved out of would not qualify for homeowner's coverage. We have been through that several times where our home in one state was for sale while we moved to another state or we would remodel and move out for a few months. In each of those cases we were forced to buy expensive vacant dwelling coverage.
 
For what its worth... when my brother passed away, it was roughly 4 months before we "settled" on his house (let the finance company have it). He had the same insurance man I have. Was told that if the insurance company found out it was vacant, the insurance would be cancelled. Was suggested to leave the furniture and such as so anyone who looked in the windows could see it was still furnished and livable. Yes, they can and will 'check it out'. When we finally removed the rest of the contents I left the curtains shut and never went back. The insurance stayed valid until I cancelled it upon receiving paperwork from the finance company. Now I'm not saying this is totally legit, and no way did the agent guarantee anything, but it got us thru the short time that we needed.

I guess what I'm saying is the most important part is that the house has to look as if it is still occupied.
 
Have any friends or friends of friends you trust who need a place to stay?  Maybe a housesitter deal could be worked out.
 
Unless you live on top of a mountain or in the woods don't you have neighbors that can watch the house?

That will solve the problem with squatters, the biggest error people make is when they go out even for a day, is they don't shut off the water to the washing machine.  Those pesky hoses have a habit of bursting at the wrong time.

 
The insurance stayed valid until I cancelled it upon receiving paperwork from the finance company. Now I'm not saying this is totally legit, and no way did the agent guarantee anything, but it got us thru the short time that we needed.
Click to expand...

The policy may not have been cancelled but the insurance company may not have paid a claim filed for a loss during no occupancy if that was a condition in the policy.
 
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