INSURING A SECOND HOME
Top Ways to Save
If your second home is typically unoccupied for periods of time, it’s worth investing in items that create insurance discounts to offset the cost of your premium. This includes smoke detectors, fire extinguishers, deadbolts and a central alarm system for burglaries, fire and low temperatures that contacts an outside service.
Second homes generally cost more to insure. This is because premiums are based on a variety of factors such the amount of time that it will be unoccupied, its location and the liability from renting the property. Often the qualities that attracted you to your second home—such as its location—are the same ones that can make insuring it more costly. Depending on the location and features of a second home, the risk of natural disaster, or even the presence of a pool, you may find coverage difficult to obtain. If you’re considering the purchase of a second home, contact us to learn more about the cost of insuring the property.
Protecting Your Home Away From Home
If you’re investing in a second home, we’ve gathered some insurance basics that will help you make the best buying decision when it comes to determining insurability and estimating your ongoing cost of ownership.
Dwelling Fire Insurance
Since most homeowner policies require occupancy as a condition of insurance, the fact that you visit infrequently may preclude you from obtaining full homeowners coverage. Dwelling fire insurance is an alternate coverage option utilized in insuring residential rental or non-owner occupancy property, including vacant property. A dwelling fire policy continues to offer coverage for a home and other structures (e.g., detached sheds or garages) for perils named in the policy. Named perils listed in a typical dwelling fire policy protect against damage caused by fire, collapse, lightning, wind, hail, explosion and smoke. For more coverage, consider adding personal property protection.
Renting Out Your Home to Others?
Whether your second property is an apartment unit or a family home, if you’re renting the property, you will have little control over the physical damage that can occur in or on it. To mitigate your risks, tenant-occupied dwelling insurance will cover the costs incurred by damage, including fire, storms, burglary and vandalism. However, it doesn’t cover your tenant’s personal property. Renting your property furnished or unfurnished also has insurance coverage implications. If you are renting your property furnished, make sure to let us know. We can advise you on the best coverage options and whether you need to consider requiring longer-term tenants to carry additional renters insurance. As with all homeowners insurance, it’s important to be sure that there is enough coverage to protect all of your property values and assets when purchasing coverage.
At a minimum, your lender will require that you carry hazard insurance to protect your property against damage from theft, fire, flooding and windstorms. It’s also a good idea to add liability insurance—which covers you and members of your household for accidental injuries to your visitors. For an extra layer of protection, a personal umbrella liability policy extends your liability coverage for properties named in the policy.