let’s talk: VACANCY POLICIES
|This week I am getting ready to put a vacancy insurance policy on Project Philadelphia as we prepare to put it on the market. Let’s talk about VACANCY!|
So as we do, let’s talk Real Estate, let’s talk VACANCY POLICIES…
First it is probably important to note that difference between a vacant and unoccupied home.
An unoccupied home is a property that is left as if the homeowners or tenants could return at any time. The utilities are on, the appliances are functioning and there is personal property on the premisses. The rule of thumb seems to be that your home is considered unoccupied if you/your tenants plan to leave the home for 30+ days. In this event, you may want to confirm with your insurance provider that your homeowners policy is still considered active and will cover you in the event of an emergency.
Whereas a vacant home is when the home is empty and no one lives there.
If your home is in fact vacant OR is unoccupied for months at a time, you might consider getting a vacancy policy.
Here is why….
Typical homeowners insurance policies won’t cover theft, vandalism, fire or liability in the event the home is unoccupied for 60-90+ days OR if the home is in fact vacant.
If your house is unoccupied, and you or the inhabitants plan to come back in a few months, you can ask for a vacancy add on to your existing homeowners insurance policy.
If you’re home is vacant, and you do not need a homeowners insurance policy any longer, you can purchase a vacancy policy and cancel your current homeowners insurance policy.
Here is the thing about vacancy policies though…
(1) They are expensive…like 50% more than your average homeowners insurance policy. This is because an unoccupied home is considered more risky than an occupied one as there is a higher chance of a break in and a slower response time in the event of an emergency.
(2) Some vacancy policies include liability, some do not. Here is what I mean. There are some cases where a vacancy property will only cover the premises NOT if someone gets hurt on the property. For me, I NEEDED to have liability coverage as well. We hope to sell this property and in the event someone gets hurt while they are touring the home, I want to make sure we are covered.
I would recommend speaking with your insurance agent to find out EXACTLY what your policy covers.
That is all for today guys! Have any of you had any experience with vacancy insurance policies?! Share your thoughts with the group!
|Feel free to comment on the blog post HERE and let us know what YOU think!|
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Me – this is based on my own personal experience!