If you have a second home of some sort, whether it’s a house or vacation home, you might be wondering how to go about insuring it. You know the drill with insuring a primary residence, but what about a home that you’re not planning on living at full-time? Well, you’re right to wonder – insuring a second home will look different than insuring your first and primary home. We’ll go over the coverages you might need for your vacation home.
Hazard coverage for your vacation home.
Hazard coverage is one option for insuring your second home, and your lender will most likely require that you have it. They’ll feel a lot better if you have hazard coverage for your property, especially because the places that people like to go for vacation have a good chance of getting walloped by a big storm. Aside from storms, there’s always the possibility of fire or another disaster.
Liability coverage for your second home.
In order to be completely protected, you’ll probably want to add liability insurance to your policy. If someone gets hurt on your property, they could hold you responsible, and without liability insurance you’d be facing those costs yourself.
To really boost your level of coverage, you can consider if umbrella liability insurance is right for you. If you face a catastrophe and your other liability policy taps out at a certain limit, your umbrella will step in to cover the rest.
It’s important to make sure that your second home is just as protected as the first one. You’re investing in this property and this home, and you don’t want your vacation-themed dreams to come crashing down around you.
Making sure your home away from home is covered.
A note about insuring a second home – most insurance companies will require that someone live at the house to cover it, so you might not be able to get full homeowners coverage for it. But there are still steps you can take to protect your home. Dwelling fire policies are often used for residential rental properties or dwellings that aren’t occupied full time.
A dwelling fire policy can give you coverage for the home and other structures by naming perils that these things are protected from. Things like fire, collapse, lightning, wind, hail, explosion, and smoke are generally covered (yes, the name is a bit misleading.)
What if you want to rent out your vacation home?
You’re not living there full time and it’s in a great location, so why not rent it out? Sounds like an easy way to make that second home earn its keep. If you’re planning to rent out the house, you need to make sure that it’s protected from risk. The reality is that you won’t have too much control over what will or will not happen if you’re renting out your home to tenants.
If you’re renting out the home, you can consider tenant-occupied dwelling insurance. This can cover the costs from damage, including storms, burglary, and vandalism. However, it won’t cover the cost of the tenant’s property, so it’s probably a good idea to make sure that everyone’s clear on this. You don’t want to end up in an awkward situation where the tenant expects your insurance to cover the cost of their lost belongings. They’ll need to get their own renter’s insurance policy.
Bottom line, you’ll want to talk to your agent to see what kind of coverage you’ll need for your second home. Each scenario is different, and they’ll be able to advise you based on your specific case.
How much will it cost to insure a vacation home?
Like we said, the cost will depend on your specific second home and situation. There are a few things that could influence the cost of the insurance on your vacation home.
- The fact that the home might be unoccupied for stretches of time.
- The location of the home.
- Pools.
- Having a pool on the property can impact the premium because your risk goes up.
How can you save on your second home insurance premiums?
To save on your premium, it might be a good idea to invest in things that will help you qualify for discounts. Installing smoke detectors, fire extinguishers, deadbolts, a monitored security system might help you lower your premiums. You might even be able to turn your security system into a monitored fire alarm system. Even though these things are an initial investment, with the savings on your premium they could end up paying themselves off.
Even though you might not visit your second home very frequently, it’s still important to make sure that you have the coverage you need. Insurance is not an out of sight, out of mind kind of issue. Your second home deserves to be protected, and you can relax knowing that, even though it’s far away, it’s protected from anything that could befall it.
Do you want to get a quote for insuring a condo or rental property? Or maybe even your first home? Great! We love insurance! And we really love getting people free quotes on their insurance, so that’s what we’ll do for you. It’s easy – just give us a call or fill out our quote form.