Do You Need Vacant Home Insurance?

If you own a property that no one lives in, you likely aren’t covered by your homeowners insurance. Here’s how to get the coverage you need.

Written by Hilary Collins / June 1, 2022

Quick Bites

  • Vacant property isn't usually covered by a standard homeowners insurance policy.
  • There are many cases in which a house you own could be empty for a certain period of time, and it’s important that any loss or damage that occurs in that period is insured.
  • Vacant home insurance can help you protect your property even when you’re not there in person to care for it.

Vacant homes happen. Maybe you inherited a home, or you’re moving before your house has sold. Maybe your rental property is between tenants or you’re having extensive home renovations or an intensive medical procedure. 

Whatever the reason, a vacant property isn’t usually covered by a standard homeowners policy, and if something bad happens when you’re not there, you may have to pay for repairs out of your own pocket.

Luckily, vacant home insurance (or vacant property insurance) is there for exactly these situations. With the right policy, you’ll be protected.

Inside this article

  1. Why do I need special insurance?
  2. What's covered?
  3. What’s the average cost?
  4. How to save on your policy

Why do I need vacant home insurance?

It may surprise you that your standard homeowners insurance doesn’t apply to a house that’s left empty for a period of time. But there are risks that come with a property not having an owner or tenant present. Burglaries, vandalism or squatting are all possibilities, and events like a water leak or damage from natural disasters can be far worse if no one’s around to notice and respond quickly.

There’s a distinction that some insurance companies make between a vacant home and an unoccupied home:

  • An unoccupied home is one that still contains possessions and furniture and still has utilities turned on—if you’re taking a three-month sabbatical, this is likely your situation.

  • A vacant home is empty and might have the utilities turned off—like a landlord’s property between tenants or an unsold house.

This distinction may or may not matter depending on your insurance provider. After all, both vacant and unoccupied houses present the same problem: they have unique risks due to the lack of a live-in caretaker. And because of that, most insurance companies will require a specific policy or a rider to cover either kind of empty home. 

Tip: Whether your vacant house is furnished or not, it’s still open to unique dangers. Thieves may take advantage of a vacant home that’s still furnished, while squatters might be more tempted by an empty place.

If your property will be unoccupied for over 30 days, most insurers will discontinue coverage—though some will grant homeowners insurance policy holders a vacancy permit if you make the request before the 30 days are up.[1] 

A vacancy permit usually provides basic coverage from such things as fire and wind but usually won’t extend to burglaries, vandalism or water damage. That’s why you need vacant property insurance specifically.

What does vacant property insurance cover?

A basic policy for vacant properties will usually cover the damage from the following:

  • Theft

  • Vandalism

  • Lighting

  • Hail

  • Wind

  • Fire

  • Smoke

  • Water

Of course, every policy and provider is different so read the fine print and determine if you’ll need additional coverage specific to your property.

Most insurance providers will offer you a wide variety of time frames for how long you’d like to carry the vacant property insurance, anywhere from a few months to a year.[2]  Of course, you’ll only want to pay for it as long as you need to.

What’s the average cost of vacant home insurance?

Because of the greater risks of a vacant property, vacant home insurance will cost significantly more than an average homeowners insurance policy. According to the Insurance Information Institute, vacant home policies cost as much as 50% to 60% more than a basic homeowners policy. 

According to 2018 data from the National Association of Insurance Commissioners, the average cost of homeowners insurance is about $1,249 per year.[3] If you assume that vacant home insurance is 60% more, you could be looking at around $1,998 to insure a vacant house for a year.

Tip: Finding a friend or a caretaker who will regularly stop by and check on the house can lower your insurance premium.

And much like other forms of home insurance, the cost of vacant property insurance will also depend on factors like your credit score, the condition and age of the home, the neighborhood, the crime rate and more.

How to save on vacant home insurance

However, there are ways to lower the cost as well as reduce the overall risk to your home. Premiums are generally lowered when you install an alarm system, deadbolts, smoke detectors and a sensor to protect against freezing pipes.[4]

These kinds of preventative measures make it more likely that you can stop theft, vandalism and squatting before they set in. They also make it easier to catch problems like water leaks or fires before they ruin the entire structure.

If you have a property sitting open, you may be tempted to pocket the extra money and take your chances. But once you understand the risks that face a vacant property, you can make the smart choice to protect that home until you hand it off to the next tenant.

Article Sources
  1. “A Vacant Home Still Needs Insurance: Don’t Be Caught Without Coverage,” Nov. 19, 2009, The Insurance Information Institute.
  2. “Vacant Homes Pose Insurance Risks,” Aug. 3, 2010, National Association of Insurance Commissioners.
  3. “Dwelling Fire, Homeowners Owner-Occupied, and Homeowners Tenant and Condominium/Cooperative Unit Owner’s Insurance Report: Data for 2018,” 2022, National Association of Insurance Commissioners.
  4. “Managing the Risks of a Vacant Home,” July 2009, International Risk Management Institute.

About the Author

Hilary Collins

Hilary Collins

Hilary is an experienced finance writer with a passion for turning complicated topics into readable stories with real-world takeaways.

Full bio

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