Homeowners insurance for your second home

Whether your second home is a seaside bungalow or a cabin in the woods, you’re going to need homeowners insurance to protect the home and your personal belongings. Insurance for your second home has all the same coverages as your primary home, but insurance costs are going to differ because the risks that determine your rates are slightly different for second homes.

Insurance companies view second homes as riskier to insure than primary homes since they’re vacant for a solid portion of the year. That makes them susceptible to break-ins or sustained damage in the event of a leak or fire, which can make second homes expensive to insure.

Your insurance rates are also going to be impacted by the home’s location, among other factors. You may need additional coverage — like flood insurance or more robust dwelling coverage — if the residence is in a tropical area prone to hurricanes.

Can you cover two homes under a single policy?

You generally can’t insure two homes under a single policy, as it’d be functionally impossible; every home is different and has its own unique coverage requirements. But some insurers may give you the option to combine two home insurance policies under a single policy package with one bill and one deductible. With this option, you may also be able to save money on your premiums, plus it’s easier to track your coverages and budget when all of your insurance falls under a single payment.

Metlife Grandprotect, for example, lets you combine your auto insurance, home insurance, and special personal property coverage for jewelry, collections, and art. AIG and Chubb have similar policy packages.

Factors that determine vacation home insurance costs

As we delved into earlier, when you insure your vacation home, you’re protecting it with the same type of policy that you have for your primary residence. However, your second home will be rated differently because of a number of risk factors, which include:

How often the home is occupied

Most second homes are used as vacation homes, and since life isn’t simply a year-round vacation, it’s going to have a lot of alone time. For insurance companies, the home’s vacancy is itself a risk, and they’ll rate you higher (meaning they’ll increase your insurance payments) based on that factor alone. There’s a few reasons for this:

• Vacant homes are more likely to be burglarized
• They’re more likely to have hazards (like leaks, fires, or infestations go undetected
• They’re more likely to be vandalized

Liability risk is also considered when rating vacation homes. For example, if your next-door neighbor’s kid sneaks onto your property, uses your pool, and gets injured or drowns, you could be saddled with liability for legal expenses for not securing your property well enough.

Conversely, if your home has a groundskeeper, or is in a gated community or HOA with security cameras (we’ll go more into that later), that could potentially lower rates on your vacation home.

Location

You may be wondering why your modest-sized oceanside retreat in Naples costs a couple thousand more a year to insure than your 5,000-square-foot split-level in Duluth. The answer is that with home insurance, like a lot of other things, location is everything. Waterfront homes are deemed risky by insurers because of the heightened risk of windstorm or flood damage, and that means, at least in the case of the above example, that your premiums could be significantly higher.

Homes in coastal areas also may be subject to separate named storm or hurricane deductibles in the event of a wind- or hurricane-related loss. These deductibles are typically higher than deductibles for other risks.

Vacation home features

Certain amenities that you have for your vacation home, like a hot tub, sauna or pool, can cause your insurance rates to go up.

It’s a rental property

If you plan to rent out your vacation home during the period of time you’re not there, your carrier will likely increase your rates, or they may require you to get special rental property insurance. Certain rental services like Airbnb offer their own insurance, but the coverage is limited to liability expenses.

How to get insurance for your vacation home

You may find that getting insurance for your second home is a little more difficult to acquire than the insurance you bought for your primary home. As we’ve already discussed, the unique risks associated with seasonal homes may make it difficult to find an insurer to cover you.

But if you have a clean claims history, decent insurance score, and your home isn’t a literal shack on the beach, you should be able to find a carrier to insure you. Farmers Insurance, for example, writes specific specialty homeowners insurance policies for seasonal and vacation homes, and just about every other major carrier has similar offerings.

If your vacation home is located in a coastal county and you’re not able to find insurance on the private market, you can get coverage through your state’s FAIR Plan, which is last-resort homeowners insurance with limited amounts of coverage. FAIR Plans are typically pretty expensive for the coverage that you’re getting, so try to avoid this at all costs.

Looking for insurance for your second home? Well look no further than Policygenius. We understand how burdensome the insurance buying process can be, so we’re making it easier.

How to save on vacation home insurance

There are a number of ways you can make your second home insurance costs more affordable.

• Install security cameras or staff your property with armed guards
• Install high tech risk-prevention systems, like water leak sensors
• Fit your home with a central burglar alarm or smoke detector
• Bundle your primary residence insurance and secondary home insurance under one policy package
• Buy a vacation home that’s part of a HOA community