Is Getting a Rider on Your Homeowners Insurance Really Needed?

Posted on: Nov 16, 2021 | 3 mins | Written by: HDFC ERGO Team

Is Getting a Rider on Your Homeowners Insurance Really Needed?

Unoccupied and Vacant Home Insurance Policy - Home insurance

Homes that are left unattended for weeks pose more risk of a theft or break-in incident than occupied homes. Unoccupied and vacant homes come with more significant insurance risks. Therefore insurers will not provide coverage for losses for such homes under a standard house insurance policy. Therefore, if your home has not been in use for many days, you should buy an unoccupied and vacant home insurance policy to avoid that big hole in your pocket that might occur due to any misfortune in your vacant home.

What is an Unoccupied and Vacant Home Insurance Policy?

A standard house insurance policy would provide coverage for up to certain days against fire, electrical breakdown, theft, natural calamities, accidental damage, and manmade hazards like riots, terrorism, etc. However, if the damage occurs when the home is left unoccupied for a certain number of days, there will be no coverage for any losses.

Hence, if you are not staying at your home for an extended period and don’t have any trustworthy friends or neighbours to check your home regularly, you should consider buying an unoccupied and vacant home insurance policy. When your home remains empty for a longer time, the chances for burglary, fire, explosion or any accidental damage increase even more due to lack of maintenance.

In simple words, if you leave your home unattended for a few months and there is a fire, unoccupied and vacant home insurance would provide coverage where your standard house insurance policy wouldn’t.

When should you opt for an Unoccupied and Vacant Home Insurance Policy?

Your home is one of the significant investments of your life. You put in your hard-earned money to purchase a property. However, suppose your home is left unattended due to any reason, you should speak with your insurer and confirm the duration for leaving your home unattended to get the coverage for losses incurred during that period.

Here are a few scenarios where your home can remain unattended

• You have a vacation home that you tend to visit a few times per year.

• You’ve bought a home but plan to shift later after several months.

• Due to a business trip, your home remains unattended for weeks.

• Due to medical treatment, you might have to stay in hospital for a few weeks.

• Your home is unoccupied as you have to find a tenant to rent out your home.

During these scenarios, you should consider buying an unoccupied and vacant property insurance policy to get coverage for losses that might occur in an empty home.

Factors to Consider While Buying Vacant and Unoccupied Home Insurance Policy

Vacant and unoccupied home insurance policies can either be bought as a separate policy or as an endorsement. The premiums for an unoccupied property are higher than a standard house insurance policy because of the higher risk of unattended homes. When your home stays empty for an extended period, the chances of theft go up significantly. Also, due to no maintenance of vacant homes, the cost for structural damage increases. These factors lead the insurer to cause a hefty premium for unoccupied and vacant home insurance policies. You can consider buying an unoccupied and vacant travel insurance policy as an add-on along with your existing policy if you are renting out your home where you might find a tenant after a month or two. Similarly, if you are going to stay in a hospital for several weeks for medical treatment, you can buy an unoccupied and vacant home insurance policy as an endorsement.

However, if you stay abroad or visit your home only during vacations, you should consider buying a separate unoccupied and vacant home insurance policy. You can get the premiums reduced by installing a fire security alarm, carbon monoxide detector, etc. The geographical location and the security level of the area also play an integral role in deciding the premium.

Conclusion

Vacant and unoccupied homes can lead to severe damages as no one looks after the property. Moreover, losses incurred can drain your savings; hence, you should buy an unoccupied and vacant home insurance policy to avoid this.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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