Vacation Home Insurance

WHY YOU NEED TO INSURE YOUR

VACTION HOME

   After all, you aren't there all the time. You don't have nearly as much personal property there. Do you really need to insure it? Yes. Yes you do.

 You're right, you aren't there all the time. If no one is there, how will anyone notice a leak? Or catch a fire before it blazes out of control? What if you get burglarized? Chances are no one will be there to prevent or at least handle these situations on a timely basis. This means the damage could be much worse than it would have been if someone lived there full time. These are high risks you don't want to pay for on your own. 

   Many vacation homes are in rural or beach areas. Let's say you are there when one of those situations occurs, but the fire /police departments are miles away and they take 30 minutes to get there. A fire can destroy an entire home in that amount of time. A leak can destroy your entire flooring. A burglar can empty your home. These are a high risks you don't want to pay for on your own. 

   What if you rent it out or let friends/family stay there when you are not there?  Somone trips over a rug and breaks their leg. Or someone starts a fire in the kitchen and can't get it out. You can be liable for injuries and or damages, even if you are not there. These are high risks you don't want to pay for on your own.

   You have worked hard to buy that secondary home for your family to enjoy. If something happens, you want to make sure you have adequate coverage for that vacation home, just like you do for your primary home. 

Just like your primary home insurance, there are many optional coverages and many carriers to choose from. Talk to your agent and work through what you want and need in coverage. Most primary home policies will not extend much coverage to a secondary property. So you will need a separate policy for your vacation home.

There are few options I urge you to consider.

Personal Umbrella Policy (PUP): This is an extra Liability policy that will pick up where your home/auto policies stop. So if you have a liability claim of $500,000 and you only have $300,000 in Liability coverage on your secondary home policy, your PUP will kick in and cover the rest. The more properties, cars and toys (boats, motorcycles...) you have, the higher the premium will be for the PUP. But the added coverage can be a financial life saver.

Fair Rental Income: If you are renting out your secondary home, I highly recommend this coverage. If the home becomes uninhabitable (therefore un-rentable) due to a covered loss, you can be paid the rents you would lose during the time it takes to repair the damage. 

Coverge Amount: As I explained up above, you are more likely to have extensive damage from a fire, leak or burglary because you are not there full time. Make sure you have enough dwelling coverage to cover a total loss. Don't go cheap because you don't use the home as often. You need complete coverage because of the lack of time you spend there. 

Every carrier is a different in what they will/will not cover, what type of policies they will/will not write. So, I wouldn't get your heart set on "bundling" by trying to make sure your secondary home policy is with the same carrier as your primary home policy. That is not always an option (your primary home carrier may not even write secondary homes). Sometimes they won't have the best rate. So be open to the quotes your agent offers you. Of course, if you are with a captive carrier, you won't have many options. Again- I urge you to find an independent agent and see what they have to offer. 

Have other questions? Need a quote?

                

                                                                    

                 
         

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Renters Insurance Basics

Renters Insurance Basics

Every policy (regardless of type) should have a Declarations Page, commonly referred to as the “Dec Page”. This page “declares” who you are, what property you have insured, your coverage choices and how much you are paying for this policy period.

Similar to Homeowners insurance, there are 2 types of coverage on your Renters insurance policy; Coverage that protects the other party and coverage that protects you.

Coverage that protects the other party:

Personal Liability: Covers you if someone is injured on your property due to your negligence.  It may help pay for treatment of their injuries and your legal costs.

Guest Medical Payments: May provide reasonable and necessary medical expenses to a guest on your property injured in an accident.

 

Coverage that protects you:

Personal Property:  This is your contents on the property. This can be written as Actual Cash Value (ACV) or Replacement Cost (RC) coverage. ACV coverage means your belongings are covered at the amount it would cost to replace them minus depreciation. So if you have a 5 year old tv that is stolen, you will receive the amount it would cost to replace the tv 5 years ago.  RC coverage means your belongings are covered at the amount it would cost to replace them at the time of the claim. So if you have a 5 year old tv that is stolen, you will receive the amount it would cost to replace the tv at todays cost.

Loss of Use:  May provide reimbursement for reasonable increases in living expenses (such as a hotel room or apt) due to a covered loss, if your rental home is uninhabitable.

Deductibles:  is the amount you pay out of pocket when you file a claim for a covered loss. You will have several options to choose from for your deductible. If you have a $500 deductible and a $6,000 loss, the insurance carrier would pay you $5,500 for the claim. A higher deductible will generally mean a lower premium and vice versa.

Additional coverage: You may be able to add optional coverage such as extra jewelry coverage or Identity theft restoration or increased coverage for business property.

For Parents of college students:  if you have kids living in dorm, remember- personal property coverage  on your home insurance policy will extend to the dorm. But it only covers up to 10% of your personal property coverage amount. A renters policy is an inexpensive way to make sure you child is covered at school!

Have questions? Need a quote?    

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