Home & Property > Vacant Property > FAQ
Why isn’t a homeowner's policy designed to protect a vacant property?
Why is the premium higher for vacant home insurance vs. a homeowner's policy?
What is the Vacancy Permission endorsement?
Homeowners policies expect that the home is currently lived in. Temporary vacancies are usually allowed (i.e. you are away on vacation for two weeks), but if the home is unoccupied for a long period of time, the possibility for damage increases.
Here’s an example: if a small fire starts in an occupied home, someone may be able to put it out. At the very least, the fire department would be called. In a vacant home, a fire can go unchecked until the home suffers severe damage.
Vacant homes also have an increased potential for liability issues. Kids or “vagrants” can break into the property. If they get hurt, you could be sued– even though you had no knowledge they were there.
These are just some of the reasons a homeowners policy isn’t designed to cover a vacant home. Many insurance companies don’t like to cover vacant homes because they are more likely to suffer certain kinds of damage, or damage on a much larger scale.
The price you pay on a standard homeowners policy is, to some extent, based on the fact that if there is damage to the home, you can report it immediately. If a home is vacant, damage can occur and become worse over time. Because the damage can be more expensive to fix, the premium on vacant home insurance coverage is higher.
Vacancy Permission is a special endorsement that means less hassle for you. You can have it added to your DP-1 policy when the home is vacant, and then have it removed when it’s occupied. It’s much easier than the alternative, which can mean canceling one insurance policy to simply buy another.
Products, coverages and discounts are not available to all persons, in all states or apply to all possible risks. Terms, conditions and exclusions may apply. Rates are derived from a number of factors, which can influence the price, discounts and savings. Your rate may be higher or lower. Policies are subject to underwriting review and approval. Rates are subject to change. Policies are written by one of the companies of American Modern Insurance Group, which includes American Modern Home Insurance Company and American Family Home Insurance Company.
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