You know that you need homeowners insurance in case your house gets damaged or someone gets injured on your property. When you put your house on the market, your existing policy may or may not provide you with adequate protection.
What Your Current Policy Will Cover While Your House Is Being Sold
If a buyer comes to visit your home and gets injured and you’re found liable, your homeowners insurance policy’s liability coverage can pay for medical bills and other related expenses. If the house or its contents get damaged while the house is on the market, your policy’s dwelling and/or contents coverage can pay for repairs or replacement.
Why Insurance Companies Offer Different Policies for Vacant Properties
A vacant house is more likely to be a target of vandalism, theft, fire and arson. If a problem such as a plumbing leak occurs, there won’t be anyone around to notice it, which means the damage can become significant before an issue is detected. Insuring a vacant house is therefore much riskier for an insurance company than covering one that’s occupied.
When a house sits empty, an insurer generally requires the owner to have vacant home insurance, which has significantly higher premiums than coverage for an occupied dwelling. It may be possible to add vacant home insurance to an existing policy, or it may be necessary to purchase a separate policy.
Why You Might Need to Change Your Insurance Coverage When Selling Your House
A standard homeowners insurance policy applies when the owner is living in the house. If you have already moved out and the house is sitting empty, your current policy may no longer apply. If you plan to move out before you sell the house, you may need to change your coverage.
If something happens and you don’t have the right type of insurance, your loss may not be covered. Some carriers automatically deny a claim if the property was vacant at the time of the loss. Some insurers will cancel a policy on a house that sits vacant. The amount of time a house must be empty before it is officially considered “vacant” can vary from state to state, and insurer to insurer.
It can be difficult to get coverage for a vacant house. No furniture and neglected maintenance are clear signs that a house is unoccupied, which makes the property more likely to be targeted by criminals. Homeowners insurance companies may refuse to provide coverage for a house that’s completely empty.
Talk to Your Insurer
Carefully read the terms of your current policy to find out when your insurer deems a house “vacant.” Contact your insurance company or agent to discuss your specific situation, find out what type of coverage you will need and learn about premiums and other important details.