Purchasing a vacation home is filled with excitement and curiosity. Many people have a goal of having a second home, and it’s highly beneficial to ensure you’re protected in case anything happens to your home. Vacation home insurance is a type of homeowners insurance policy that covers a home you own but don’t live in full time.
Vacation homes are typically viewed as being at higher risk by insurance companies because they are left unoccupied part of the time. For example, if you own a beachfront home down in Florida, the risk of theft or vandalism may be higher if you and your neighbors only visit periodically.
Similarly, it may take longer to detect water damage, infestations, or rotting with a vacation home, which could increase the likelihood of the insurance company having to pay out a claim for damages. We’ve compiled a list of tips and tricks for navigating vacation home insurance and what to look for in a policy.
Know What’s Covered In Your Vacation Home Insurance Policy
Similar to any homeowners insurance policy, it’s important to know what’s covered within your vacation home policy. Typically, you’ll be able to find this in an insurance binder given to you by your provider. This binder should outline which coverage your policy already includes.
Most basic homeowners policies will have dwelling coverage, and some will have both dwelling and belongings coverage. As for liability coverage, you’ll want to check with your provider to see if your primary residence’s liability insurance can extend to your second home.
As always, you’ll be able to add on coverages as you choose and work with your provider on how to curate the ideal insurance policy for your vacation home. Most providers are more specific when insuring a second property and will only cover certain perils or events. It’s important to be precise and detailed when creating a policy to ensure your home has as much coverage as you’d like.
Understand The Costs Of Secondary Home Insurance
If you’re purchasing a second home in a different location than your first home, the difference in costs between the two policies may shock you at first. Understanding the costs and conditions within your policy is a big step in the process.
Things that have the potential to be priced differently for your second home can depend on:
- Property Type
- Age & Condition of Home
- How Often the Home is Occupied
Everything is subject to change based on your specific insurance company and policy, but the list above is where price changes will typically come from. It’s always important to communicate with your insurance company to confirm why prices or policies may be different from your first home.
A great way to cut down the cost of your vacation home insurance policy is by bundling your primary residence policy and this second residence. By pairing the two together and getting the secondary home policy with the same insurer, you may qualify for discounts. This is also a great way to stick with an initial insurance company and better understand their processes and inclusions.
While insuring an entirely new property may feel overwhelming at first, it’s important to be thorough and ensure you’re covered. If disaster ever does strike your second home, it’s comforting to know your insurance company is there to help.