Considerations for Holiday Home Insurance
If you own a holiday home, then you will need to look into a suitable insurance policy in order to protect you from unexpected costs, such as burst pipes, roof damage, flooding, and theft. A standard home insurance policy will not be enough to protect your holiday property, as they tend to be associated with certain risks that standard homes do not typically suffer from. For this type of insurance, compare not only the best rates on the market, but also the fine print of each policy. We will look at some of the things you should have in your policy so you can better estimate which one is the right one for you.
Why Aren’t Holiday Homes Covered by Standard Policies?
Insurers will typically not cover a holiday home under a standard policy as a they carry a number of unique risks. For example, because they are often left unoccupied for long periods of time, they are at greater risk of suffering from a burst water pipe or theft. Furthermore, if you let out your holiday property while you are away from it, most insurers will look at such a situation as a liability because, presumably, tenants have less of an interest in maintaining a rented property than they would their own property. Also, most insurance policies will not cover a home if the owner is away from the property for more than 30 days. Considering these unique factors, plus the fact that holiday homes are prone to all the same hazards as standard homes are, and it is no surprise that insurers are more reticent about them.
What do you Need in a Holiday Home Insurance Policy?
Aside from all of the items one would expect from a standard policy, yours should cover items beyond a standard policy. The most important part will be your buildings cover. This section will cover the actual structure of the property, along with any permanent installations, such as swimming pools, sinks, bathtubs, and outbuildings. The buildings cover should cover the cost of rebuilding your property should the need arise. However, if your property is overseas, make sure your insurance policy applies to the specific country your home is in. Many insurance policies have certain exceptions for certain countries. For example, they may not cover the cost of earthquake damage in areas prone to earthquakes, such as Italy. Also, be sure your rebuild policy is linked to inflation as otherwise you may receive far less coverage than your property actually deserves.
Contents insurance is often overlooked by owners who assume that the contents of their property are not valuable enough to bother covering. However, even if there is no single expensive item in yours, the collective cost of all of the contents can quickly add up. Contents insurance is important to have to cover the loss of those contents in case of damage or theft. Look at the details of such coverage, however. Many policies will place limitations on contents insurance if you let out your property, or they may limit the maximum value of specific items.
If you let out your property for part of the year, landlord insurance is vital. This policy can cover any damage caused by tenants, but may also cover the loss of income you would suffer should your property become uninhabitable. Such loss of income coverage is typically only provided if the property has already been booked beforehand. Finally, if your property becomes uninhabitable whilst being occupied by the tenants, some policies may cover the cost of providing alternative accommodation for those tenants, such as hotel bills.
A holiday home is a great asset to have, providing a refuge for relaxation and pleasure. However, it is important to know that insurance it is not the same as standard home insurance. They come with their own set of unique risks that could affect how much you pay for your insurance, and what sort of insurance you need. For this type of insurance, compare the fine print between all policies. Doing so will ensure that you get the coverage that is right for your needs.
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