If you own a home that is not occupied, are doing extensive remodeling or building your dream home from the ground up you will likely need a Vacant Insurance Policy or a Builders Risk Policy.
Vacant Insurance offers coverage on an unoccupied home, whether it is on the market for sale or you don’t have a use for it right away. Most homeowners and dwelling insurance policies offer limited vacant coverage.
If you are planning on selling your home and keeping the current coverage in place, you should notify your insurance agent and ask if the home being vacant is covered. If you don’t and there is a loss, the claim could easily be denied.
Vacant Insurance is typically more expensive than Homeowners Insurance, as no one is occupying the home regularly to make sure maintenance is kept up. However, it is offered in terms of 1 month through 12 months, so you only pay for the time you expect the home to be vacant. Prices can range from $150/month and up depending on the home’s value.
Coverage is usually offered for the structure itself as either Actual Cash Value (depreciated cost) or Replacement Cost, although Liability Insurance can typically be included.
If you are remodeling your current home, investment property or building your dream home from the ground up, you will need to purchase a Builders Risk policy (some contractors may require you to purchase this on new construction and others may not).
Similar to Vacant Insurance, Builders Risk covers a buildings structure and materials on site or in transit. Coverage can be offered on an Actual Cash Value or Replacement Cost basis and liability can sometimes be purchased. If liability is not available your homeowners or renters insurance policy may extend personal liability to cover the property.
Our agency has multiple companies that offer these both of these policies and we can help navigate which is right for you!