The type of insurance policy for a property you purchase depends on the occupancy of the home. Who is going to live there? It is important to let your insurance agent know if the occupancy of the dwelling changes along the way as well. Some policies will remove important coverages when a dwelling is no longer owner-occupied. Below are some basic policies available for a dwelling:
Homeowners Insurance policy:
A homeowners insurance policy is written when a dwelling is purchased and is the primary residence of the purchaser. Based upon the dwelling coverage limit, a homeowners insurance policy normally includes automatic limits for Other Structures, Personal Property and Loss of Use. Limitations of coverage are traditionally included in a homeowners policy if a dwelling has been vacant for more than 30 consecutive days immediately before a loss/claim. Also, if a home is vacant there can be exclusions for damages from freezing (including leakage and/or overflow) of plumbing, heating, air conditioning, automatic fire protection sprinkler, and domestic appliances.
Dwelling Fire Insurance policy:
A dwelling fire insurance policy is written when the purchaser of a dwelling rents a home to others. Some insurance carriers will require that the home be currently rented or be occupied by a tenant within 30 days of the policy inception. Also, a 12-month lease between the owner and tenant is highly recommended and sometimes required by an insurance carrier. A dwelling can be insured for Replacement Cost (to rebuild) or for the Actual Cash Value (financial protection – payout in place of rebuilding). Additional coverages included in a home such as Other Structures, Personal Property, and theft normally need to be added a la carte.
Vacant Dwelling Insurance policy:
A vacant dwelling insurance policy is written when the purchaser of a dwelling has no occupants in a home. These policies are normally much higher priced insurance policies due to the increased exposure. As with a dwelling fire insurance policy, a dwelling can be insured with some insurance carriers for Replacement Cost (to rebuild) or for the Actual Cash Value (financial protection – payout in place of rebuilding). Additional coverages included in a home such as Other Structures, Personal Property, vandalism and malicious mischief and theft normally need to be added a la carte.
Keeping your trusted insurance agent informed of the occupancy of your owned dwelling can help avoid any gaps or exclusions of coverage.
You can experience the benefits of being a part of a full-service Independent Insurance Agency today! Simply contact Briggs Agency, Inc. if you are interested in an Insurance review at 219-769-4840 or visit our website at www.BriggsAgency.com. We look forward to hearing from you!
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