Home insurance is an excellent investment for any homeowner, allowing you to have peace of mind should the worst happen to your property. With a second home, getting proper coverage is also important to provide relief during expensive events. However, there are some things worth knowing about second home insurance and why it differs from standard home cover.
Deciding the best second home insurance to meet your demands is not always easy. Afterall, second home insurance cover can change between policies and comparisons sites don’t always provide good insight into these variables.
At Emerald Life, you can save yourself the hassle and confusion by jumping straight into affordable and effective second home insurance. Our second home insurance provides widespread cover against risks and events that can befall your property. Get a quote online or call us to find out more.
We want customers to get more from their second home insurance and for cover to be available to everyone. Whether it’s cover against damage or personal liability insurance, our flexible policies are tailored to provide the most complete protections possible.
Additionally, we understand there are many questions about second home insurance. Below you can find about this special type of home insurance and why it may benefit you if you have an unoccupied home.
What is second home insurance?
Second home insurance – sometimes known as unoccupied home or holiday home cover – is a policy that protects property that is not your principal place of residence. For people who own a second home or holiday home, the property is just as susceptible to the same risks as your main house. Moreover, you won’t always be there to ensure your unoccupied property is safe or secure. That’s where insurance for second homes can be helpful, protecting your property should costly events occur.
Situations applicable when buying second home insurance:
- Properties left unoccupied for 30 consecutive days or more.
- Holiday home that is available to rent or in use seasonally.
- Houses used for temporary use if working away from the family residence.
- Properties that are available to rent.
While home insurance of any kind is not mandatory, taking out a second home insurance policy should be viewed as a sound investment. Normal home insurance policies will not cover for a property that is not your main place of residence or your family home. If something happens to your unoccupied home, without insurance you will be left on the hook for any expenses. This makes insuring second home properties a wise decision.
Emerald Life’s second home insurance is specifically set up with second homes in mind, understanding that you won’t always be there.
What is a second home?
It’s important to properly define which of your properties is your main residence and which is a second home. This can sometimes be tricky, but it’s worth considering some factors when making the decision. One example is where all your belongings are kept and which property you spend most of your time in.
More concrete aspects that define your main place of residence is the home where you have your legal interests. For example, where your car is registered would tell insurers which property is your main residence and requires standard home insurance. Anything that is not your legal address may be classed as a second home by the insurer, depending on the circumstances.
Can you have home insurance on two homes?
Many homeowners with two properties make the mistake of thinking they need standard home insurance for each home. While it is possible to buy standard home cover for two properties, problems can arise from doing so.
If you don’t tell your insurance provider that the second home is not your main residence, real issues will arrive if you need to make a claim. This is because there are different terms and conditions between standard home insurance and second home insurance.
Perhaps the biggest distinction is most home insurance policies will not protect homes that are unoccupied for 30 days of more. In other words, if you’re not in a property for a month, your insurance company is unlikely to pay out on a claim.
For second home insurance, the insurer understands you are not likely to be on the property for long periods of time. This reflects in policies that do cover for homes unoccupied for over 30 days. Furthermore, if you lend or rent your second home, doing so would likely break the terms and conditions of regular home insurance.
What Makes The Best Second Home Insurance For Me?
Like with most types of insurance, there’s no one-size-fits-all answer for people seeking second home insurance. Much will depend on your individual circumstances and needs. How often are your away from the property, is it usually empty, do you rent it? These are all questions that you need to answer before purchasing insurance.
When speaking to an insurer, it’s important to state clearly the home is not your main residence and then to choose a policy based on your situation. Some points of a policy may be perfect for one homeowner but not for the next, while your budget may also play a role in your level of cover.
Emerald Life aims to make choosing a second home insurance policy easy. Our products are available across three levels that allow customers to understand the level of protection they receive.
Buildings insurance is arguably the most important component of second home insurance. As the name suggests, it covers the cost of repairing or rebuilding your home if it is damaged or destroyed. In most situations in England, having building insurance is a mandatory stipulation of borrowing for a mortgage, but not always.
If the structure of your property is damaged or destroyed, building insurance can cover repair costs. It usually includes peripheral structures like sheds and garages while covering the cost of replacing home systems like cables, drains, and pipes.
A good second home insurance policy will provide complete financial aid to fully rebuild your house, including demolition, clearing the site, and paying for architects. Homeowners increasingly understand the value of buildings insurance to protect them against property events that could leave them in financial trouble if they were to pay for repairs themselves.
Typical loss or damage cover in a building insurance policy includes:
- storms, floods, earthquakes,
- fire, explosion
- burst and frozen pipes
- theft and vandalism
- fallen lampposts, trees, satellite
- dishes, and masts
- vehicles, animal, and air
Different policies will have some or all these elements, while also including exclusions and situations where the insurer may not pay out on a claim. As always, it’s hugely important to read your policy’s terms and conditions.
There is no legal requirement to hold buildings insurance, but some mortgage lenders may make cover a condition of lending. While some lenders will be more lenient than others, it is becoming more common for mortgages to require buildings insurance. Importantly, if a lender does demand coverage, they will likely recommend an insurer to you. It is worth remembering you can reject their recommendation and look for your own insurer.
How much cover to get?
Understanding the level of buildings cover you need on a second home insurance policy is tricky. However, the clear objective should be to insurer your property for the total amount it would cover to completely rebuild the home (sum insured).
One mistake homeowners often make is believing the cost of rebuilding their home will be the same value as what they paid for the property. Luckily, that’s not the case and rebuild costs are typically less that the current market value of the home. This makes it important to avoid over or under insuring the house.
Assessing the potential cost of a rebuild can be confusing, but there are online calculators available, including the Building Cost Information Service online calculator on the Association of British Insurers’ website. Moreover, many insurance companies offer unlimited insurance that remove the need of calculating rebuild costs.
Contents insurance is part of secondary home insurance to protect you against, damage, loss, and theft of your possessions. It covers all belongings in the insured property, including all possessions of family members living with you. However, contents insurance will not always cover the possessions of someone staying in your second home temporarily.
There is no legal obligation to purchase contents insurance for your second home. That said, it’s a good idea to get cover because without insurance you will be left paying for stolen, damaged, or lost belongings. That may be a risk you’re willing to take for that book you haven’t been able to find for months, but you may not feel so confident if you have to replace a major appliance like a TV or fridge/freezer.
Even the most basic contents insurance policy should cover damage and loss caused by weather events, fire, and theft. While this type of insurance will cover more household items, there are some exceptions or times when you’ll have to pay extra. For example, if you take items out of the home there may bean extra cost to cover them.
Expensive and valuable items such as jewellery may also carry this extra cost or your insurer may refuse to include them on a policy for second homes. In these cases, it may be wise to take out individual insurance out on items that would be particularly expensive to replace.
There is also a distinction in some policies regarding how much will be paid out on a claim. Some insurers provide new for old cover, which means a lost or damaged item will be fully replaced with a new like-for-like replacement. Other insurers will only cover you for the amount the item is worth when a claim is made.
How much cover to get?
Like with building insurance, you need to know how much contents cover you need before buying insurance. To do this, calculate how much it would cost to replace all the belongings in your home. Most people vastly under-insure themselves and don’t realise just how much all their possessions are worth.
Do a rough calculation in your head. Include every significant item, appliances, electronics, flooring, what you have in your garage, and the thousands of small items you have. You’re probably already shocked by the financial outlay you would face if they were all lost.
While there is no requirement you live in your second home to get insurance, most providers will require you to carry out regular visit inspections. Simply put, there is an increased risk of damage from storms, water, or theft when a property is unoccupied, and this risk increases the more days it is left without inspection.
Most insurance for second homes states you or a representative must visit the property to conduct regularly internal and external inspections. The allowance for these inspections differs, but most insurers require a visit at least every 14 to 30 days. Furthermore, insurers ask that a record of the inspections is kept.
Exclusion and Conditions
While second home insurance policies cover against a lot of perils, all policies will have a set of exclusions. These are the risks that the insurer will not pay out for. Most of the exclusions in unoccuped home insurance are common across all policies and include:
- Damage through war
- Radioactive and nuclear contamination
- Deliberate damage caused by you
- Damage existing before the policy was taken
- Biological and chemical contamination
- Micro-organism damage (mold, mildew, etc.)
- Cyber attacks
- Damage from contractors
- Wear and tear
- Faulty workmanship
Many people who own a second property use it as a holiday home. In fact, people will rent out their holiday home either as a short-term rental or for AirBnB. As well as providing insurance for second homes, Emerald life also offers cover for people using their second property for short terms rentals and AirBnB.
AirBnB Insurance: Emerald Life’s AirBnB insurance considers the unique nature of renting homes through the digital platform. Understanding the specific needs of AirBnB rentals means we can tailor policies and price them accurately for individual customers. For owners, it means they have peace of mind a claim will not be rejected.
Short Term Insurance: One of the challenges of insuring a short-term rental is paying for a policy even when a property is not being used. Landlords can use Emerald Life to find a policy that allows pro-rata refunds when the home is not in use if you buy a 12 month policy. With this flexibility, fixed short-term policies are avoided.
Article: Second Home Insurance