Average Cost of Vacant Home Insurance – A Guidance
Many homeowners fail to realize that the cost of uninsurable risks on their homes is included in the average cost of vacant home insurance quotes. When homeowners attempt to purchase homeowner insurance coverage for a “fresh” policy they are typically sold that the policy is uninsurable once the home has been vacated. This misconception is one of the biggest errors made by homeowners.
The average cost of uninsurable risk coverage for a “normal” single family house can be two to three times more than the quote from a vacant homeowner’s policy. This increase is due to the fact that an abandoned home or one without an occupant represents a much higher risk than a similar property occupied by a current occupant. In addition, many homeowners that attempt to obtain “normal” homeowner insurance coverage will discover that the coverage offered is actually uninsurable once the property has been vacated. This surprise can result in significant financial difficulties for the policyholder and can make it necessary to purchase a policy at full price. However, there is hope when it comes to this issue.
First, in terms of the American modern, the average cost of vacant home insurance will more than likely remain unchanged due to the fact that most homes in the US have sustained substantial damage during the average span of ownership. Secondly, even if the home is not damaged there is the potential for substantial water or electrical infiltration into the home. The best way to overcome this issue is to have the water or power installed by an accredited and authorized contractor. This is important because of the regulations regarding “hot water” installations within the state of Texas. An unapproved installation will almost always lead to liability and/or legal action being taken against the homeowner.
In order to avoid having to purchase “uninsurable” coverage, many owners simply ignore the problem and do not purchase any kind of coverage for their homes. This is unfortunate because an uninsured or uninsurable policy is essentially no good whatsoever. The insurance company will only pay out in the event of an insured natural disaster or fire. If there is a natural disaster or fire then the value of your policy will immediately decrease.
The average cost of uninsurable, or “abandoned” vacant homes and the average cost of vacant home insurance will stay pretty much the same. But the rates will vary from company to company and state to state. That is why many owners do not consider this issue when they first purchase homeowner’s policies. They assume that since they live in an area with a high number of abandoned or undefended homes, these companies will insure them at fair market value. It is often difficult to determine whether an insurer will actually honor a claim if the home is unoccupied. So it is smart to be prepared and buy an adequate homeowner’s policy before purchasing an “abandoned” or “uninsurable” policy.
One of the most common ways to obtain a cheap homeowner’s rate on an uninsurable policy is to choose to “self-insure.” This means that you insure your home against a loss by making payments into a special savings account. When a claim is made against the policy by the insured, the savings account pays the claim amount. Many homeowners find this option very convenient and quite affordable. In addition, it can provide peace of mind and help the family budget for unexpected events.
You also need to make sure you buy the appropriate amount of homeowner’s coverage. There are many ways that you can determine the appropriate amount of coverage for your home. The cost of insurance for vacant land will be substantially different than the cost of insurance for an unoccupied property. For this reason it is important to talk with a local agent to determine the best coverage for your particular situation.
If you own a home that is currently unoccupied, it is never too early to start thinking about purchasing homeowner’s insurance. The first step in doing so is to determine the level of coverage you need. After that, begin shopping around for the best rates. Your efforts to reduce the cost of your insurance should help you save hundreds of dollars per year and thousands of dollars over the life of your policy.