Insure for Full Rebuild Cost on Vacant House

When a house becomes vacant or empty and vacant homeowners insurance is needed, one of the most important things to remember is the home needs to be insured for the true rebuild and reconstruction cost.

Often, even after someone understands the need for vacant home insurance, they ask to be insured just for the amount they owe on a loan, or if they are selling, they want to insure for a low value in order to keep their premium payment lower because the cost of vacant home insurance is much more than regular homeowners insurance.

This practice is dangerous. First, any reputable insurance company needs to insure a vacant home for the full rebuild cost assuming there is a total loss. Most people don't realize if this is not done, there can be severe penalties at claim time if an insurance claim is filed on a vacant house.

Any company willing to insure you for less than the true rebuild cost using like or the same materials should be avoided.