Your vacation home is your getaway, a wonderful place to relax and unwind. But it does come with unique risks.
It is important to consider the property’s location and possible hazards. There may be additional requirements from the insurance company related to caretaking, snow removal, alarm systems, etc. that should be considered. Many of these mitigation measures come with added policy discounts.
Here are some insurance basics for insuring a second home.
At a minimum, your lender will require that you carry hazard insurance to protect your property against damage. It is also a good idea to include liability insurance, which covers you and members of your household for accidental injuries to your visitors. Opting for property plus liability insurance adds up to a standard homeowners insurance package. For an extra layer of protection, a personal umbrella liability policy extends your liability coverage for properties named in the policy. In most cases, an umbrella policy is relatively affordable. A small premium could help prevent a large adverse impact to your financial standing.
Dwelling Fire Insurance
Dwelling fire insurance provides coverage for homes that you own but don’t live in for most of the year. It is similar to a standard homeowners policy with the major differences being that the liability is not worldwide and is restricted to the residence premises and the amount of contents coverage is customizable given this may not be an owner-occupied home. There are other coverages that may not be available or automatically included in the dwelling fire program, so it’s important to discuss the details or restrictions with your insurance agent.
If you have a waterfront property or a property that is in a special hazard flood area, you might want to purchase flood insurance. Flood damage is excluded from standard homeowner’s insurance policies.
Renting Out Your Home to Others
If you decide to rent out your vacation home for part of the year, the insurance policy on your second home may not cover damage that occurs while the home is being rented out.
Renting your property furnished or unfurnished also has insurance coverage implications. Further, many homeowners’ insurance policies do not cover short-term rental activity. The gap in coverage could leave you dangerously exposed if guests cause significant damage to your home.
We can advise you on the best coverage options and whether you should consider a short-term rental insurance policy or require longer-term tenants to carry additional renters insurance.
As with all homeowner’s insurance, it is important to be sure there is enough coverage to protect all your property values and assets when you choose your policy. Having one agent handling all your personal insurance needs can help ensure that you have the proper coverage without overpaying.
At Avery Insurance, we are licensed to provide primary and secondary home coverage throughout the country.
Avery agents have the expertise and relationships with national carriers that enable us to put together customized, competitive insurance programs for all your personally held properties.
Contact us today to learn more.