What Happens with Insurance on a Vacant or Unoccupied Home?

February 17, 2015

insurance on vacant home

image courtesy of Sattva/freedigitalphotos.net

You might think that it would be unusual for your home to be vacant or unoccupied. But it happens quite often here in Central New York.

We know of a friend in a nice neighborhood in the Utica area who lives near two recently vacant homes. In one, the single son and parent have both moved on to other living situations. In the next house down the street, the owner suddenly passed away from an illness.

So what happens to your homeowners insurance if you’re faced with a situation where you or a family member owns a vacant home? Besides the circumstances in the above real life examples, you might be selling your home after moving to a new location, moving your elderly mother to assisted living, or if you’re retired, spending half the year in Florida and half here in New Hartford.

Is Your Home Your Principle Residence?
Here’s what you should know about insuring your vacant home. The first issue to consider is insurance coverage on the building and contents. Most homeowners insurance policies say they cover the building that’s “used principally as a residence premises.”

The important thing here is “used principally as a residence premises.” If you have left your home to live elsewhere, you might have a problem if you have a property loss. However, if you still use your home as a principle residence but live elsewhere for part of the year, you are covered.

What if the Pipes Freeze?
Your policy may specifically exclude loss caused by freezing of a plumbing, drainage, heating, air conditioning system or automatic fire protective sprinkler system or household appliance while your dwelling is vacant or unoccupied.

This exclusion may not apply, however, if you have used reasonable care to maintain heat in the building or shut off the water supply and drained the system and appliances of water. These are good ideas if you’re leaving your home for any period of time, especially during our Mohawk Valley winters. Water flowing out of the pipes for even a short amount of time can create a devastating loss in your home.

Also, your homeowners policy may not pay if your dwelling has been vacant for 30 consecutive days prior to any loss caused by vandalism and malicious mischief or breakage of glass or safety glazing materials. This exclusion applies also for damage to your contents by glass or safety glazing material that is part of a building, storm door, or storm window.

Is There a Problem if You’re Sued?
What about the Liability Coverage section of your homeowners policy? Here the problem arises with the exclusion that states that Personal Liability does not apply, “arising out of any premises owned or rented to any insured or rented to others by any insured which is not an insured location.”

So what is an “insured location”? Among other things, it’s “the residence premises.” It’s very possible that in the event of a loss, the insurance company will determine your vacant dwelling is not an insured location and deny the claim.

How to Get Insurance Coverage on Your Vacant or Unoccupied Dwelling

Give us a call if you find yourself in a situation where your home is vacant (no furniture) or unoccupied (furnished but no one living there). We will listen to you and consider the precautions you’ve made to secure the building.

This is usually a temporary situation. The home is for sale or you’re out of town for a length of time but plan on returning. Things such as draining the pipes, keeping the heat on, and having family or neighbors regularly checking the house are all positive actions that make it easier to insure the dwelling.

We can also easily change your policy from a homeowners to a fire policy that will assure you coverage for the time your dwelling is in transition. Give our personal account managers a call anytime; we’re here to help you solve even the most troublesome of insurance problems.

Until next time,
Your SZW Team

Scalzo, Zogby & Wittig, Inc. is your New Hartford area independent insurance agent. Call us for a quote on insurance for your home, car, business, or life at 315.792.0000.