What is vacant home insurance?

Do you own a condo that isn’t currently being rented out? Or maybe you just bought a house, but you aren’t planning on moving in just yet. Even if there’s no one living in your home, it can still be prone to certain risks, which is why you need to consider a vacant home insurance policy to ensure your property is protected. 

What is vacant home insurance?

Vacant home insurance is a specific type of insurance that protects homes without current residents. Your regular home insurance policy is designed for a lived-in home – there should be someone to shovel the snow in the winter, call maintenance if a pipe bursts, or even turn on the lights at night to prevent a burglary. Without someone to check on or maintain the property, your vacant home faces a higher risk of damage and therefore, requires its own type of home insurance. 

How long can I leave my house unoccupied? 

Most home insurance policies have a 30-day unoccupancy rule. This means if your property is unoccupied for over 30 days, your insurer can void your home insurance policy and deny your claims. To get around this, be sure to let your insurer know about your absence before or within the 30-day period. You can explore different options with them, depending on whether your home is unoccupied or vacant. 

Differences between unoccupied vs. vacant homes

In insurance terms, “unoccupied” and “vacant '' mean two different things. Each home insurance company can have their own guidelines of whether a home is deemed unoccupied or vacant. 

However, generally speaking, an unoccupied home is a home that can be lived in at any time, and you intend to live in it in the near future. For instance, if you’re taking a summer vacation and leaving your house on its own for a few months, it is considered unoccupied. 

If this is the case, you might not need a special insurance policy at all. Many insurers allow unoccupied homes to extend past the 30-day rule (as long as your insurance provider is aware), but be sure to ask someone check in on your place regularly during the unoccupancy period. 

On the other hand, a vacant home is a property that you aren’t intending to live in at all. The utilities could be shut off, and there might not be any furniture in it at all. Investment properties that are sitting on the market, waiting to either be rented or sold, are considered vacant homes. 

What is a vacancy permit?

Not all insurance companies offer coverage for vacant homes, because of the additional risks that come with it. Depending on the reason your place will be empty (eg. for sale, unrented, death), some insurers may offer a special insurance policy or a vacancy permit to protect the property. 

Vacant home insurance coverage

Be aware that your vacant home insurance doesn’t provide the same extent of coverage that a regular home insurance policy does. For instance, vandalism, flood damage, and window damage, may not be covered because the risk becomes too high for insurers. So be sure to speak to your insurance broker ahead of time to understand the length of your coverage and find other ways to increase your protection. 

Average cost of vacant home insurance

So how much is vacant home insurance? Vacant home insurance is more expensive than regular home insurance, even though there is less coverage, because of the extended risks that come with an empty place. The cost varies depending on several factors (e.g. length of vacancy, reason for vacancy, time between property check-ins), but you can expect to pay about 50% higher than your regular homeowner’s policy. So with the average cost of home insurance in Canada as $960, your vacant home policy could cost about $1440 annually. 

READ: The average cost of home insurance in Ontario

Do I need vacant home insurance for my cottage?

If you own a seasonal or vacation property, such as a cottage, you won’t need a special vacant home insurance policy – however, you’ll still want to protect it with vacation property insurance. 

Insurers offer this type of insurance as either an inclusion within your current home policy (also known as secondary property insurance) or a separate, additional policy. Depending on various factors such as the location, size, and roadway access of your seasonal property, it can cost between $800 to $3,000 annually to insure. 

Do I need vacant home insurance for a renovation?

If your home renovations take over 30 days to complete, and you won’t be living on the property during this time, be sure to let your insurer know. You might be required to purchase a vacancy permit in order to get coverage for this period. And if your insurer doesn’t provide permits, you should look for a provider that does.   

READ MORE: Do you need home insurance for a renovation?

Ways to protect your vacant home

Any property can be an expensive investment, but vacant properties can feel especially costly as they aren’t being put to use. Therefore, it’s important to limit your risks as much as possible – here are some ways to do so:

• Add extra locks on all doors and windows
• Upgrade your security system to include an alarm
• Set timers on your lights for nighttime 
• Get your grass cut, leaves raked, and driveway shoveled 
• Move any valuable items out of the property
• Park a vehicle in the front regularly 
• Check in on the property regularly (or ask a neighbour, friend, or family member)

The bottom line

If there’s one thing to take away, it’s to contact your insurance broker if you won’t be living in your home for a while (or at all). The last thing you want to deal with after coming home from a relaxing vacation is a break-in – especially if you’re uninsured. And if your investment property isn’t rented out at the moment, you’ll feel much better knowing it’s protected under your vacant home insurance policy. 

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