Owning a second home can give you a place to vacation any time of the year. Whether you want a beachside cottage or a cabin in the woods, a second home can be your designated location for rest and relaxation.
Since you won’t be living in your second home full-time, you may be wondering if you can forgo insurance. However, going without this essential coverage could leave you at serious financial risk in an emergency. It may even affect your qualifications for a mortgage, as many lenders require borrowers to obtain homeowner’s insurance.
Whatever kind of second home you want, you should protect your property with homeowner’s insurance. To help you protect your asset, we’ve compiled some tips for insuring your second home.
What Is Considered a Second Home?
A second home is one you visit regularly or occupy for part of the year. Many homeowners use their second homes for vacations. However, you may also own a condo or an apartment in a city you travel to often for work. Many lenders require a second home to be a certain distance from your primary residence to qualify for a loan. Examples of second homes include:
- Apartments
- Condos
- Cabins
- Cottages
- Lake houses
- Beach houses
Seasonal vs. Secondary Home Insurance
Before purchasing your policy, you may need to determine if your property qualifies as a seasonal or secondary home. According to one definition:
- A second home is one in which you reside for a small portion of the year.
- A seasonal home is one in which you reside for a more extended period, but only during specific times of the year.
However, the distinction between second versus seasonal homes can vary by provider. The definition your insurance carrier and mortgage lender use will determine what type of coverage you need.
A second home can be riskier to insure. With the home empty for long periods of time, it has a greater risk of robbery, vandalism or undetected damage. Additionally, if you primarily plan to use your second home as a rental property — especially for long-term rentals — you should invest in landlord insurance to cover things like liability and loss of rent.
Insuring a Vacation Home
The property’s type, location and condition will all impact how much it costs to insure your vacation home. If it’s located in an area prone to natural disasters, your insurance carrier will take that risk into account. For example, if you’ve purchased a beachfront home along the Florida coast, the potential damage from hurricanes and tropical storms will increase your coverage needs.
You may face higher premiums for a single-family residence without a security system. Apartments and condos may be more affordable to insure due to the building or complex owner’s security measures.
Homeowner’s Insurance for Two Homes
Check the homeowner’s insurance policy for your primary residence to determine whether it will also cover your second home. If so, you may not have to get a new policy. However, you may find that your properties need separate policies to cover different risks if you buy a second home in a distant location or plan to use it in another way.
What Is the Best Type of Insurance for a Second Home?
A secondary home insurance policy is the best type of insurance for a second property. This type of policy should offer coverage for the following:
- Your dwelling: Your second home’s structure is covered against certain perils, such as theft, weather damage or fire.
- The loss of use: If you can’t use your second home because of a covered loss, you may need to temporarily live in another location. Loss of use coverage can cover your associated living expenses.
- Your personal property: A secondary home policy can cover loss or damage to your personal property, such as your kitchenware and furniture.
- Your personal liability: If someone sustains an injury on your property, personal liability coverage may pay for the related medical and legal costs.
- Your additional structures: Your policy may cover damage to other structures on your property like a garage or shed.
You may also need separate policies for additional protection. You might need landlord insurance if you plan on renting out your property. If you’re sharing your second home with family or friends, you may want to consider an umbrella policy.
Vacation Home Insurance Cost
Your property’s type, condition, value, location and amenities can all impact the cost of your insurance:
- Property type: The type of property you have can impact what coverage you need and how much your insurance costs. For example, since condo fees contribute to insurance for the building and common areas, it typically costs less to insure a condo than a single-family home.
- Condition: Your property’s condition and age could affect the cost of your insurance. The policy for a newer home in excellent condition or a well-maintained older home will likely be more affordable since it’s less likely you’ll need to file a claim.
- Value: Higher-value homes can also be more costly to insure. The higher a property’s value, the more it will cost the insurance company if you file a claim and the more you’ll have to pay for your policy.
- Location: Your property’s location is another major factor in your insurance costs. If your home is in an area prone to earthquakes or floods, you’ll need to purchase additional insurance. Cabins in the mountains tend to be at higher risk of wildfire damage, and beach homes tend to be at greater risk of hurricanes. How close your home is located to emergency services like police, hospitals or fire departments can also affect your costs.
- Amenities: Some amenities at your vacation home, such as a hot tub or pool, could increase your need for liability protection and the cost of your insurance premium.
You may be able to lower your insurance costs by finding a home in an area with less risk, installing a security system or bundling your policies.
Get the Best Homeowner’s Insurance for Your Second Home
Whether you’re planning to rent out your second home or keep it to yourself, as the best local Erie and Progressive insurance agent, Strock Insurance is here to help. Along with homeowner’s insurance for your primary residence and second home, we can help you insure your condo, apartment, rental property and mobile home. Beyond homeowner’s insurance, we specialize in several types of insurance, including:
We have locations in Cumberland, York and Dauphin Counties and can provide you with competitive rates in the Central PA region. Contact your local insurance agent at Strock to get a secondary home insurance policy or to learn more about homeowner’s insurance for vacation homes.