Do you really know?
With over 18 million vacant homes in America and average days on market remaining high in most areas, it is important to know when a home (listing) is covered by homeowner’s insurance policies and when it is not.
Most homeowners do not know and many Realtors are unaware that when a residential home becomes vacant and remains vacant for over 30 days, most homeowner’s insurance policies become invalid, leaving a need for a vacant home policy which can cost nearly 50% more than standard policies. It’s one of the tiny details in the fine print of most homeowner’s insurance policies that is easy to miss.
How to get an extended policy
Some insurers will extend policy coverage when requested within the first 30 days of vacancy, but even then, theft and water damage is not often covered.
Because condos share walls, the risk is seen as less, thus the cost is lower and for a select few carriers, the original policy may be extended.
What if there is a house fire!?
It is important to be familiar with your client’s homeowner’s insurance policy (and even insurance agent)- what if someone falls down the stairs while your listing is on day 45 of being vacant and the policy holds your client completely liable? What if your client moves states and on day 70, their home burns to the ground? Are they covered?
It’s too bad standard insurance doesn’t cover this, it feels like a loophole for carriers to sell more policies, but why not let it be you that helps make sure your clients have the appropriate amount of vacant homeowner’s insurance coverage?
Joe Manausa
March 22, 2011 at 7:32 am
I did not know this Tara. Thanks for the “heads up.” We’ll have to start advising our selling clients to check with their insurance agents.