Homeowners insurance covers your house as well as the property inside it against damage or loss. When you buy a second home, you must buy homeowners insurance to protect your investment. Obtaining insurance for a second home, however, may be harder than getting it for your primary residence and may also be more expensive. Taking a few basic precautions can increase the likelihood of acquiring an insurance policy and lowering your payment. Consider the potential difficulty of insuring the home before you buy it to save yourself some trouble.
Contact your current insurance provider. Not only are insurers more willing to extend policies for current customers, but they also frequently offer a discount for multiple policies. Be prepared for questions regarding the specifics of the home for which you are trying to obtain insurance.
Determine the risks to the home and take reasonable steps to mitigate them. Hire a caretaker or arrange for a neighbor to check on the home frequently in your absence and take the necessary steps in the event of a weather crisis -- wrapping pipes or turning water faucets on to a drip before a freeze, for example. The primary benefit to a paid caretaker is prevention of theft or squatting, which are major concerns for unoccupied homes.
Arrange for landscape service for the second home during your absence. Maintaining the appearance of the home can give the impression that it is occupied, reducing the risk of theft or damage. Installing lights that operate on timers.
Have a plan to evacuate the home in the event of any likely emergency during your time of residence. For those that are in a hurricane-prone area, an evacuation plan and supplies to board up windows is prudent.
Obtain home alarm or monitoring systems. While a home alarm system usually gives you a discount for your insurance policy, having one in a second or vacation home can help you get the insurance in the first place. Most security systems alert police of an intrusion, and fire alarms and smoke detectors alert the nearest fire department.
Look into umbrella insurance. Umbrella insurance extends your liability limits for all insured property. Once you own two homes, with property inside each, the value of all items is likely more than your normal insurance will cover. Umbrella coverage is additional coverage and can protect you from things like negligence lawsuits.
- Before you buy the home, look to see if it is in a flood plain or wildfire-prone area. Many insurers have limits on how many new policies they will write in those areas. Additionally, you will need to purchase flood insurance separately, on top of your homeowners insurance policy.
- If your home is in a rural area, confirming that the fire department will be able to reach the home quickly in the event of a fire and have access to water might reassure the insurer.
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