Vacant Homes and Insurance
95% of householders don’t understand what happens to their insurance on the house when the home becomes empty or unoccupied. This can be how owners find themselves with no coverage once submitting a claim and the insurance company learns the house wasn’t being lived in at the time of claim.
Every home-owner’s insurance policy is different, however one factor is for sure. Householders insurers can not still insure a home, if the house isn’t being lived in by the first homeowner. A house that’s fully vacant (moved out) can end insurance more quickly than other situations.
Right now, there are thousands of homes that haven’t any insurance coverage, but the homeowners believe the house is fully covered as a result of they simply do not grasp the provisions of their insurance policy.
Put simply, individuals don’t seem to be aware that they are risking everything. Common examples of cases that result in the house being considered vacant are:
o House sits empty for 90 days whereas the owners have moved out of state and are waiting for the old home to sell o A house is unoccupied for 72 days while the children decide what to do with the house of a deceased parents o A townhouse sits empty for 5 months whereas the owner, a college faculty member, is teaching a semester abroad. The professor thinks the house will be covered as he had asked the neighbor to check in on the home o An expatriate lives abroad whereas his house back within the US is being lived in by a friend. He failed to inform the owners insurer and switch the policy over to a landlord policy. The actual fact remains that virtually everybody in these types of situations do not perceive the risks involved.
If there were a claim in one of those situations, the householders insurance company could deny the claim and refund some months premium, canceling the policy.
For instance, a washer hose leak could be a common claim. If an owner had come home after work for example to find the hose leaking, the claim could have been contained. Instead, the owner is not living in the house and the hose leaks for 9 days till the owner’s sister comes into the house to check on things. In this example a $10,000 claim has turned into a $100,000 claim as a result of three floors being ruined and 12 of the walls are currently infested with mold and rot.
However, the owner is shocked to learn that they are only eligible to receive $10,000 from the insurance company and the full extent of the harm isn’t being covered. Once more, all of this assumes the insurer is generous enough to produce any coverage in any respect in this situation! In many cases, this claim would be totally denied, with the insurer claiming the house was vacant and also the owner failed to inform the insurance company of the situation. But, expecting a claim to be covered for $100,000 in this example, and receiving a check for 1/10th of this amount comes as a shock to the house owner.
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