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Vacant Home Insurance Is Available But With A Catch

By Mike Heuer

The type of homes insurers find to be the most vulnerable to damage or destruction are vacant homes in which there are no occupants and even those with no furnishings, and that can result in hefty costs for those looking to insure them.

Vacant home insurance can be difficult to obtain and thus costly as many property and casualty insurance companies will no underwrite coverage for such homes. Among reasons why are the fact they have no regular caretaker or visitors who might be able to find problems that could be addressed to avoid greater losses down the road. A vacant home is vulnerable to home invasion, theft, extensive water damage and other perils that are not likely to happen in occupied homes or dwellings.

In communities where there are a lot of vacant homes, transients have been known to take up temporary occupancy and cause extensive damage by damaging fixtures, stealing copper and setting fires for warmth that wind up damaging or destroying the home. Thieves also can target vacant homes for theft of copper and fixtures, which results in large repair bills and insurance claims.

Court decisions have defined a vacant home as one in which there have enough furniture for a resident to live there in a reasonable manner. That means if there is no bed, no seating or no kitchen appliances, the abode meets the legal definition of being vacant. Once meeting the legal definition, insurers can exclude a great deal of coverage that would apply otherwise.

Even vacant homes that initially have homeowners insurance protection in place, many insurers will strip important levels of coverage after 30 to 60 days of no occupancy. Among exclusions will be damage by vandals, including broken glass, damaged walls or even if a fire is started that burns down the vacant structure. Many insurers simply will cancel coverage due to vacancy, which greatly limits the options the owner might have for finding insurance coverage.

The limited number of insurers willing to provide coverage for vacant homes makes the cost for insurance policies that much higher. There were more than 19 million vacant or unoccupied homes in the United States in 2010, according to the U.S. Census Bureau. And about 2 million of those were homes listed for sale, which means millions of homeowners are at risk of losing their investments.

But there are solutions for owners of vacant homes. One is to hire a house sitter to live in it or offer the home for rental and purchase an appropriate policy for landlords. Another is to ensure there are enough furnishings in it to prevent a legal declaration of vacancy. But when that is not an option, affordable endorsements can be bought to provide insurance coverage for vacant homes.

There are other options, too. Some insurance companies will offer actual cash value coverage for vacant homes, which can leave a possible gap in the amount an insurer might pay and what a homeowner might owe on a home loan. If there is a gap, a GAP insurance plan can be purchased to protect against a financial fallout.

Some other insurers also will provide vacant home insurance with replacement cost coverage, but only for up to 80 percent of the home’s replacement value, which still leaves a potential loss looming if it is damaged or destroyed.

One comment

Health insurance solhud be considered a human right as it is in every other western nation. When people are well they can properly participate in a society as contributors, workers, etc. When they are ill they cannot and they will be a drain on our resources one way or the other. Should we let people die because they have no money to afford health care? On the other hand, why solhud any corporation make big money on another person’s misfortune (ill health)? The health of no person solhud be dependent on his/her monetary resources. We solhud, however, be required to make payments for health insurance according to our income or ability to pay. It can only be completely free to those who have no resources.References :

by Rami on April 14, 2014 at 4:57 am. Reply #

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