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Written By Taras Trofimov

Updated

What is vacant home insurance?

Vacant home insurance – also known as a ‘vacancy permit’ – is coverage created specifically for vacant homes, which can be added to your regular home insurance policy as an endorsement.

Insurance companies deem a property ‘vacant’ when it has been left unoccupied and largely empty for a prolonged period of time – usually 30 days or longer. This may be because:

  • Your home requires extensive renovations. Some homes need drastic improvements before being considered livable. Alternatively, you may choose to alter your home for other reasons – either to meet certain needs or to make it more presentable before selling it. If the process takes more than 30 days, then vacant home insurance may be necessary.
  • You are away, for one reason or another. You may choose to temporarily abandon your property due to an extended stay at a hospital, somebody else’s home or another location. In either case, your home may end up being labelled as ‘vacant.’
  • Your home is unlivable. Your home may become unlivable because of unpaid utilities, infestation, lack of furniture or needing significant repairs.

If your home is indeed vacant, your regular home insurance policy may become void – even if you are still paying for it. The reason for this is that vacant homes face more risks, and thus, are more taxing on insurers’ resources.

Those risks are typically due to homeowners being less likely to maintain the property or safeguard it against threats such as theft or vandalism. If you feel that your home is, or will become, vacant, talk to your insurance provider to see if they are willing to insure it.


How much does vacant home insurance cost?

Vacant home insurance, or vacancy permit, can add an extra $20 to $150 a month to your premium. You cannot purchase vacant home insurance, or vacancy permit, on its own – only as an add-on to your existing policy.


The difference between unoccupied vs. vacant homes

It’s worth noting that a home being ‘unoccupied’ does not always mean it is ‘vacant.’ Vacancy usually equals to a lack of occupants for more than 30 days. Property can also be deemed vacant if it is empty – meaning it is devoid of the homeowner’s personal possessions, such as clothes, cooking utensils, basic furniture and so forth.

A vacant property is far more susceptible to risks such as theft or vandalism and is therefore more expensive to insure. As a result, if your coverage is not meant for vacant homes, your insurer may not pay for it in the event of a claim.

Unoccupied homes, however, remain as such for short periods of time. For instance, when you leave for work, or when you go on a two-week vacation. In other words, an unoccupied home is one to which the owner may return at any moment.


What’s covered with vacant property insurance?

Depending on the provider, vacant home insurance may protect your property from the following:

  • Fire: This will pay for damage to your home caused by fire – no matter what starts it (whether it is arson, negligence or seasonal wildfires). This is no different from your regular home insurance coverage.
  • Lightning: If your vacant home gets struck by lightning and suffers damage as a result, it will get covered. Lightning is different from fire, as it can damage certain items, such as electronics, without setting them ablaze.
  • Hail and wind: If hail or wind damages your property (e.g. your windows get broken), your insurer should cover the costs of rebuilding or repairing the damage up to the limit of the coverage. This includes damage from flying debris and falling trees and branches (because of hail or wind).
  • Falling objects: Should your vacant home end up ruined or damaged by a falling object like space debris or space craft, your insurer will cover the costs of rebuilding or repairing it.
  • Squatters: Due to the absence of anyone on your property, it may end up occupied by squatters, which can lead to damage or theft. If that happens, you may get coverage.

Note that coverage may vary drastically from provider to provider, and not all providers offer vacant home insurance in the first place.


Additional coverage provided by vacant home insurance

As is the case with regular insurance, you can add more coverage to your vacant home insurance – at an additional cost.

  • Water damage: If water from overland floods or thawing snow damages your home, your vacant home insurance will cover you. That said, your water damage coverage may be limited.
  • Sewer back-up: This covers another type of water damage – caused by flooding due to backed up pipes, toilets, drains or showers. Sewer back-ups usually occur from too much melted snow or rainwater entering the sewer system. This is typically beyond the homeowner’s control and can occur when one least expects it.
  • Earthquake: Should an earthquake cause damage to your vacant home, your insurer will cover the costs of repairing or rebuilding it. The likelihood of this will vary from area to area. Some areas may not even be covered at all due to the frequency of earthquakes.


What is not covered under your vacant home insurance

Vacant home insurance does not cover everything. Threats that are not covered may include:

  • Vandalism: If the likelihood of vandalism and other malicious acts, such as glass breakage, occurring on your vacant property is high, then your insurer may exclude this coverage. In many cases, the risk is too high for insurers to offer this.
  • Theft: Like vandalism, theft has a high chance of occurring on vacant properties. As a result, many insurers will not protect your vacant home from theft.
  • Water damage: Certain types of water damage may not be covered. If, for instance, a pipe bursts inside your home and floods it, you may be responsible for fixing the damage. Since the home is supposed to be vacant, insurers assume that all your amenities are turned off. They also assume that your home is maintained well enough to not suffer such damage in the first place. To avoid any misunderstandings, read your policy carefully and ask as many questions as possible.

It is also possible that the longer your home remains vacant, the less coverage it will receive. For instance, if your home is vacant for 90 days or longer, your insurer may limit your policy to fire coverage only, plus extended coverage (e.g. overland flooding, sewer back-up, etc.). Make sure you are aware of what is and isn’t covered to take proper precautions and avoid unnecessary expenses.

Recent home insurance quotes

Recent Home Insurance Quote from Ottawa, ON
Townhouse 980 sq ft
April 24, 2024
Cheapest Quote
$ 51 / month
$612 / year
Average Quote
$ 81 / month
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Savings
$ 31 / month
$372 / year
or
38.00 %
Recent Home Insurance Quote from Edmonton, AB
Detached 1,087 sq ft
April 23, 2024
Cheapest Quote
$ 94 / month
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Average Quote
$ 139 / month
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Savings
$ 45 / month
$540 / year
or
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Recent Home Insurance Quote from Woodbridge, ON
Townhouse 1,291 sq ft
April 23, 2024
Cheapest Quote
$ 75 / month
$900 / year
Average Quote
$ 131 / month
$1,572 / year
Savings
$ 56 / month
$672 / year
or
43.00 %
Home insurance quotes are compared from Apollo Insurance, CAA, Economical Insurance, Pembridge, Square One Insurance, and SGI

How to protect your vacant property

Vacant home insurance is not the only thing that can protect your vacant property. If you are really worried about something happening to it, here are some steps you can take to avoid unnecessary damage or loss:

  • Get someone to check in on your property every four to seven days each week – whether it is a family member, friend or hired house sitter.
  • Prevent water damage by turning off your water supplies, draining your toilet tanks and supply pipes, adding antifreeze to keep your pipes and drains unfrozen, installing water sensors and repairing your sump pump, if it is no longer functioning correctly.
  • Get locks for all your doors and windows, along with cameras and lighting systems that you can manage remotely to deter thieves, vandals and squatters.
  • Ensure your carbon monoxide and fire systems are in working order and consider getting an online-based thermostat system, so you can manage your home’s temperature remotely.
  • Hire someone to keep your lawns, backyard, driveway and walkways well-maintained and free of snow, fallen leaves and similar unwanted objects.
  • Redirect your mail and deliveries to an address you can monitor – or cancel them outright.
  • Unplug unused appliances and electronics to avoid the potential risks they may pose (such as fire).

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What risks do homeowners face when it comes to vacant homes?

Given that vacant homes are often left unsupervised, they face more risks than regular homes. Or rather, the risks they face are more likely to happen to them – and more likely to have severe consequences due to the lack of oversight.

Here are some of the biggest risks vacant homes face:

  • Theft and vandalism: If you don’t have any form of security system, your home may end up with unwanted graffiti, or it may even get robbed. Even if your home is mostly empty, thieves and/or vandals may still break into it. For instance, as recently as spring of 2023, thieves were stealing air conditioners from vacant homes in Windsor and leaving strange notes on walls. Vandalism is one of the most common perils to be claimed by owners of vacant homes, and in many cases, insurers do not cover it due to the frequency of such claims.
  • Fire: Though it’s usually occupied homes that are affected by house fires in Canada – caused by cooking equipment, smoker’s material and open flame – vacant homes are particularly susceptible to arson. In fact, Winnipeg set an annual record for arson in 2023, with over 100 vacant property fires reported. Unlike vandalism, however, most insurers will cover this.
  • Flood: Whether the cause is thawing snow or overflowing river, your home may get flooded. And with no one there to catch it before it is too late, it can cause tremendous amounts of damage. Flood coverage is rarely as comprehensive as fire coverage, so be sure to read your policy carefully.
  • Squatters and trespassers: Squatters may settle on your property without your knowledge. Alternatively, trespassers may enter your property for other purposes. In either case, your property may end up damaged and/or robbed. Unless you have a way of monitoring your property remotely, there is no way you would know about any of it until you visit the property yourself.
  • Illegal dumping: Vacant properties are sometimes used for illegal garbage dumping. If left unchecked, waste can draw rodents and insects, which can inflict damage on your property. The best way to avoid this is to install cameras around your property, so you can remotely check on it every now and then.
  • Disrepair: Homes that are left vacant for a long time are more likely to suffer damage from problems like aging pipes or leaky roofs. These issues usually lead to more issues, making repairs more expensive down the road. If you intend to sell or rent out your home, it is best to not let it fall into disrepair.

Frequently asked questions about vacant home insurance

Got more questions about vacant home insurance? We got you covered.

Which company offers the cheapest vacant home insurance?

Not all home insurance companies offer insurance for vacant homes, and those that do will not provide their rates upfront. That is because home insurance rates are highly individualized. Your home construction, roof age, your claim history and other factors will all play a role in determining your home insurance rate – whether it is standard home insurance or vacant. Your best bet is to compare cheap rates on comparison websites like RATESDOTCA. Alternatively, you can get in touch with a broker, such as Scoop.

Do I need vacant home insurance for renovations?

If you are planning to be away from your home for more than 30 days – which is when most insurers deem a property vacant – then yes, you may need vacant home insurance. If you are planning to conduct your renovations while you remain on the premises, then standard home insurance should suffice.

Usually, when renovations are drastic (e.g. when they require rebuilding parts of your home), homeowners will choose to live elsewhere for the duration of those renovations. Such renovations tend to take place before the homeowner moves into their newly purchased property. If you need more details, learn about the impact of renovations on your home insurance here.

Do I need vacant home insurance for my cottage?

No. Your cottage – which is likely to act as your seasonal or vacation property – can be covered through cottage insurance, either as an add-on to your existing home insurance policy or as a stand-alone policy.

Note that cottage insurance will cost you $1,000 to $3,000 per year, depending on factors such as your claim history, property square footage and condition.

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