Guides
Vacant home insurance: when you need it and what it covers
A homeowners policy can limit coverage once a house sits empty. How vacant dwelling policies work, what they exclude, and what to do between sales and tenants.
You need vacant home insurance when a house will sit empty longer than your current policy allows, usually 30 to 60 consecutive days, or when the owner no longer lives there at all. A vacant dwelling policy keeps the building insured, but with fewer covered perils, higher premiums, and conditions such as regular inspections. Call your insurer before the empty period starts, because a homeowners policy can quietly lose coverage for vandalism, water damage and theft while you are gone.
The mechanics of the clauses themselves are covered in vacancy and unoccupancy exclusions. This guide is about what to buy and what to ask.
When a home counts as vacant
Policies differ, but three situations account for most claims.
- Between owners. You moved out and the house is listed or under contract. See insurance while you're selling your house.
- Between tenants. A landlord policy may have its own vacancy limit that starts when the tenant leaves.
- After a death or move to care. The family keeps the house insured while the estate is settled. See insuring an inherited house: what to do in the first 30 days.
Other cases include a house held for resale, a property awaiting a long renovation, or an investment property between purchase and first tenant. A seasonal home used a few weeks a year is a related problem; see snowbirds and seasonal homes: vacancy, freeze and theft.
The ISO HO-3 (HO 00 03 05 11, the 2011 edition) names vacancy in only two places: vandalism and malicious mischief to the dwelling is excluded if it has been vacant for more than 60 consecutive days before the loss, and the same limit applies to glass breakage. It adds that "a dwelling being constructed is not considered vacant." Your insurer's own form may say 30 days, add water damage or theft, or use the word "unoccupied." Read the exact word and number in your policy.
What a vacant dwelling policy is
A vacant dwelling policy is a stand-alone form for a building with no resident. It is often written as a dwelling fire policy on a named-perils basis, similar to a DP-3 or DP-1, and many carriers sell it through specialty or surplus lines markets. Dwelling fire forms are explained in Dwelling fire policies: DP-1, DP-2 and DP-3.
Typical features, which you should confirm in the actual form:
| Feature | What to expect |
|---|---|
| Perils | Usually named perils: fire, lightning, wind and hail, explosion, and sometimes vandalism, which may be optional |
| Water damage | Often excluded or sharply limited, especially from freezing or a pipe left uncontrolled |
| Theft | Commonly excluded, or limited to a small amount |
| Contents | Little or none; the policy insures the building |
| Liability | Sometimes available as an add-on, sometimes not offered at all |
| Conditions | Utilities on or water shut off, periodic inspections, a log of visits, locks and boarding as needed |
| Premium | Higher than for an occupied home, since risk per day is higher |
| Term | Short, often six months to a year, with renewal depending on whether the house is still empty |
The New York Property Insurance Underwriting Association, a state residual-market plan, states that its building maximum for vacant dwellings is $100,000 (NYPIUA FAQ), a useful reminder that vacant coverage in a state plan is not always full replacement value. Check limits in your own state's plan; see New York for the market there.
Vacant versus unoccupied
The distinction decides claims. A vacant house contains little or no furniture and no one living there. An unoccupied house still holds belongings but has no residents for now. Many policies use only one of the words, and some define neither. The New York Department of Financial Services has noted that "vacant" is defined neither in New York's Insurance Law nor in the HO-3, and describes the common meaning as a residence that typically has no personal property and no inhabitants (NY DFS Circular Letter 23 (2008)). Staged furniture in a listed home does not necessarily keep it from being vacant for the purposes of a given policy; ask.
Options other than a vacant policy
A vacant dwelling policy is not the only answer. Compare these.
- A vacancy permit or endorsement. Your insurer may extend the vacancy period, say from 60 to 90 or 120 days, for an added premium. It is the least disruptive option for a short gap.
- Staying on the homeowners policy with conditions met. Some carriers keep coverage if you can show that the house is furnished, heated and checked weekly. Ask what evidence they accept.
- Converting to a landlord policy. If the plan is to rent the house, a landlord policy may fit better, though it usually has its own vacancy limit between tenants. See landlord insurance: what a rental property policy covers.
- A builder's risk policy. If the house is empty because of extensive renovation, the right product may be builder's risk. See insuring a home during a renovation.
- A state plan. If a standard insurer declines, a FAIR plan or similar program may write the property, with its own vacancy rules.
Keeping the house in insurable condition
Most losses to empty homes are preventable, and carriers' conditions reflect that.
- Heat or drain. Freezing is the biggest water exposure. The HO-3 excludes freeze damage to plumbing unless you used reasonable care to maintain heat or shut off and drain the water supply and systems. See burst and frozen pipes: what's covered.
- Visits and a log. Have someone check the house on a schedule, and write down the date and what they saw. A dated log is useful in a dispute.
- Security. Working locks, lights on timers, mail collection and cleared snow signal occupancy and discourage break-ins.
- Utilities. Keep electricity on for sump pumps and security, and consider water leak sensors that alert you by phone.
- Remove hazards. Empty the refrigerator, take out trash and flammable materials, and secure outbuildings.
Hypothetical example
Say a family inherits a house and does not move in. It sits empty from September through February, and no one turns off the water or keeps the heat on. In January a pipe freezes and bursts, and by the time a neighbor notices, the first floor is soaked. The insurer denies the water claim because the freeze condition required reasonable care to maintain heat or drain the system, and the vacancy clause had also taken effect after the 60th day. Say the repairs come to $40,000. Buying a vacant dwelling policy in September would not have fixed this by itself, since those forms often limit water damage too. What would have helped is the winter protocol: draining the system, shutting off the water, documenting both, and telling the insurer what was done.
Disclose, document, and watch notices
- Call before the home empties, and ask in plain words what coverage remains on day 30, 60 and 90.
- Get the answer in writing and confirm the effective dates of any permit.
- Check your mortgage. Lenders require continuous coverage, and if your policy is canceled, they can add a costly force-placed policy. See force-placed (lender-placed) insurance explained.
- Watch for cancellation or nonrenewal notices. A discovered vacancy can be grounds for nonrenewal in many states; see nonrenewal vs cancellation of homeowners insurance: your rights.
- Use the right form for claims. Report losses promptly and keep photos, repair estimates and utility records.
The which homeowners policy form fits your home? and homeowners coverage gap checker can help compare forms.
Key takeaways
- A standard homeowners policy can drop vandalism, glass, water and theft coverage after 30 to 60 days of vacancy, and the exact day count is in your own policy.
- A vacant dwelling policy usually insures the building on a named-perils basis with higher premiums and conditions like inspections and heat or drained pipes.
- Vacant means empty of contents and residents; unoccupied means furnished but without a resident. Check which word your policy uses.
- A vacancy permit, landlord policy or builder's risk policy may fit better than a vacant dwelling form, depending on why the house is empty.
- Tell your insurer before the home empties, keep heat or drain the plumbing, log visits, and get every answer in writing.