Insuring That Second Home

While one home may seem like enough to insure, could you imagine having insurance for two homes?

Insuring a second home comes with its own set of issues, especially since you oftentimes will not be living there.

There are, however, several tips on how to decrease your second-home bill and how to make sure you are properly covered in the event you have to file a claim.

First, make sure you have a central alarm system in place that can pick up both fires and burglaries, thereby trimming some expenses off your premium. While rates vary, you could save approximately 20 percent on your bill.

Next, being the owner a home in a gated community can also save you around 10 percent or so. For homes that are located outside of major city or suburb locales, be able to demonstrate that an area fire department can access a water source and you could see around a 25 percent discount.

If you are in the process of acquiring or have a second home, make plans to revisit the agent who you purchased coverage from with the first home. When insuring your second home through the same insurer you are likely save anywhere from 5 to 10 percent on your costs. In the event you can obtain one of the industry’s new “package policies”, which can handle two to three homes, along with a couple of cars and umbrella liability coverage, you can do even better.

For those individuals purchasing a condo as opposed to a free-standing residence, the condo association will provide coverage for the structure, meaning it is part of your monthly maintenance fee. Keep in mind that you are responsible for things such as fixtures and appliances, along with any kind of improvement.

Another item to concentrate on is umbrella policies.

For those folks who did not have an umbrella policy prior to buying a second home, they have enough assets to warrant one at this time.

An umbrella policy will extend the liability limits on one’s homeowners’ and auto policies for a reasonable fee. Most insurance experts will back a minimum of $1 million in umbrella liability for individuals with a pair of homes.

When it comes down to landlords, umbrella policies are very important, especially if a tenant’s friends are injured on the property. A scenario such as that could lead to a lawsuit.

For those individuals who rent out a vacation home, they can figure on paying around 20 percent on top of the cost for ordinary second-home coverage. The reason there is the less time spent in the second residence; thereby leading insurers to feel like the home offers more risk.

Many second-homeowners rent out their properties furnished, however, if you rent the place without furniture, it is important to let your agent know since you get a discount when it comes to contents coverage.

Finally, if you are looking at renting out the second home to long-term tenants, having them carry renter’s insurance is a good idea.