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Importance of home insurance with vacant house

Aug. 15, 2023
3 min reading time

If your home is unoccupied for an extended period of time, it will impact the validity of your buildings and contents insurance. The risks of burglary, theft and other damages increase when a home is unoccupied. During an extended period of vacancy, not all possible incidents are automatically covered. Here is essential information you need to know.

The varying definitions used by insurers for vacancy add to the complexity. Generally, a property is not considered "vacant" if you are on vacation for three weeks. However, this status changes quickly if you are away for more than two months or if your home is unfurnished. It is advisable to consult the policy wording to find out your insurer's specific definition of vacant property.

 

Four scenarios of long-term vacancy

There are several reasons why a house may be vacant, usually one of the following situations:

  1. Your old house is not yet sold while you are already living in a new house.
  2. Your newly built home has been completed, but you haven't moved in yet.
  3. The death of the occupant has occurred and the house has yet to be sold.
  4. Long-term absence due to a world trip or business trip, for example. If you know when you will return, you can check with your insurer to see if you can maintain coverage. This is often possible, provided you take measures such as time switches for lighting.

If you are moving into a new home, make sure the buildings insurance takes effect on the transfer date. For your old home, buildings insurance remains necessary as long as you are the owner. It is also important to pass on your move for your contents insurance. Some insurers offer temporary coverage for both the old and new home. However, note that coverage may not be adequate if you have purchased new furniture or possessions.

 

Limited coverage

An empty house makes an attractive target for burglars. This increases the risk of damage, resulting in often limited coverage on your home contents insurance. Damage caused by theft, burglary and vandalism is usually no longer covered. Window damage and water damage are also not covered. However, fire, lightning, storm and explosion usually remain covered. Different insurers take different approaches, with some possibly offering no coverage at all or requiring a higher premium. Therefore, it is crucial to understand how your insurer handles vacant properties.

 

Mandatory notification of vacant house

The majority of insurance policies contain a vacancy clause. This means you are required to report vacancy to your insurer in a timely manner. Failure to do so may result in the loss of compensation when filing a claim.

 

If you will soon leave your home unoccupied for an extended period of time, it is important to check the terms related to vacancy in your home insurance policies. For clarity on coverage, please contact us. 

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