Does a Homeowners Insurance Policy Cover a Second Home?
As Irma approached, we all talked with friends and/or family who were affected by the storm. I was surprised to learn of 3 close friends that didn’t have coverage on their FL property. Whether it's to live out each winter as a snowbird or spend summer weekends at a lakeside retreat, a second home can have tremendous appeal. But, as with your main residence, it's something that you'll probably want to protect with insurance.
Will your insurance policy on your primary home help protect your second home?
You can extend the liability porton of your existing homeowners policy to your second home. But you'll still need to line up a separate policy if you want to protect the structure and contents of your second home. If you have a mortgage on your second home, insurance would be a condition of your loan.
Second Homes Deemed Riskier
You may find, though, that vacation home insurance looks a little different than what you have on your primary residence. That's because sometimes what makes a vacation home so appealing may be considered risky. A waterfront location or home that is in a remote area would have unique insurance implications, which can make the property more costly or difficult to insure.
Coverage is more limited
For that reason, second homes are typically covered by a more limited type of policy called "named perils,". With this insurance, your place would only be covered against events that are specifically called out in the policy, whether it's lightning damage, an explosion, theft or smoke damage. If your vacation home is damaged by something not listed in your policy, it likely won't be covered.
Named perils policies may also be more restrictive with other protections. For instance, other structures on your vacation home property, like detached garages, sheds or boathouses, may have more limited coverage than would be provided by a conventional homeowners policy.
Boosting your protection
There are things you can do, though, to help better protect your vacation home. You may be able to add personal property coverage as an endorsement on the insurance policy, to help protect the contents of your vacation home. You might also consider a personal umbrella policy, which provides greater liability protection. This protection generally extends to your second home and any other property you purchase or rent. You may also want to talk with us to find out if there are any insurance protections for your second home that you may have overlooked. For instance, you might want to purchase flood insurance, because flood damage isn't covered by typical homeowners policies.
By taking some precautions and having insurance in place to help protect your second home, you'll be well on your way to enjoying your time at your home away from home.