Can you bundle your vacation property and home insurance?
Whether it’s a cabin in the woods, a lakeside cottage or a sunny coastal villa - your holiday home is a safe haven to escape from the hustle and bustle of working life. With the right insurance policy you can make sure it remains safe; but how do you know what the best option is for you? When it comes to our day-to-day dwelling, we all have home insurance to protect us against accidental damage, loss or theft. Perhaps you’re wondering if you can use the same policy for your vacation abode?
What are your insurance policy options?
The deciding factor usually comes down to your insurance provider. Some insurers are more than happy help you save some money by bundling your insurance. This is often sold to first time buyers when they purchase their initial property as part of an umbrella policy, should he or she ever decide to buy a second home. An umbrella policy essentially extends liability limits to other properties, usually for an additional fee.
However, some policies do not extend to second homes, or may not offer the right amount of coverage. For some homeowners, a policy specifically for your vacation property is the best route to go, allowing it to be fully tailored to your needs.
Like with any policy, you want to make sure that you are saving those dollars where you can. Take into careful consideration some of the following factors.
How often is the property occupied?
Whether your home is a summer-retreat or weekend get away could really affect your premiums. There are a number of risks associated with part-time occupation, and thus insurance for a seasonal holiday home is usually provided on a named perils policy, as opposed to an all risk policy. What that means is that your policy will cover specific dangers such as fire, explosion or smoke damage, but coverage for certain risks including water damage or vandalism, might not be as easy to acquire.
Do you ever rent out your vacation home?
Since the dawn of rental sites such as AirBnb, more homeowners are renting out their vacation properties instead of leaving them empty. Not only is it a great way to make some extra cash, it also lessens the risk of thieves targeting your vacant home. However, you will most likely need to tailor your policy for this, and consider taking out rental property insurance in the event that any damage is incurred while renters are in your home.
Have you considered the cost of your property contents?
Is your holiday home to a television, computer or other high-end, larger items? In that case you might want to think about the financial implications a loss of any of these items may cause, and determine whether adding contents insurance makes sense for you. This becomes even more relevant if you are thinking of renting out your property.
Do you have any detached structures?
For example, do you own a gorgeous, new boat perfect for those lazy summer days, and it is currently hibernating through the winter months in a boathouse? Double check with your policy provider that any detached structures on your land are included. Some insurance packages do include limited coverage for outbuildings such as boathouses, garages or sheds, but will offer additional coverage for more expensive contents.
What others ways can you save?
If you’ve covered all of your bases, but still want to keep those purse strings tight, there are some handy little things you can do. Firstly, install a central alarm system to protect against fire and burglary. Secondly, consider buying a property that’s near a water source. And, of course, contact your insurer; perhaps they'll offer a discount for having safety features, paying your premium on time or just for being a valued customer!