Hurricane Sandy creates Vacant Home Insurance claims in NJ

During Hurricane Sandy, many people found out if they had superior vacant home insurance coverage or inferior vacant homeowners insurance protection which is very common in the market.

We estimate that in most U.S. states, most policies for vacant home insurance are not all-risk insurance policies, but rather are called dwelling policies. A dwelling policy is a limited form of insurance covering only a select number of insurance perils. Some policies are fire only which is about as limited as it gets.

Getting all risk insurance on a home that is vacant or not occupied most of the year is harder to secure, but it is possible through good insurance companies.  Again, many after Hurricane Sandy are finding out just how bad their policies were.

One note, no vacant home policy, even of the highest quality, comes with flood insurance. No "regular" homeowners policy comes with flood insurance as standard so unless someone had taken out insurance from the Federal Gov't Flood Insurance Program, there would have been no coverage for storm surge flooding as well as other types of flooding in the case of Hurricane Sandy.

Vacant Home Insurance Market Still Booming in 2012

Almost 4 years into the houseing "crash" and the need for vacant home insurance is still as strong as ever. What's more, most "normal and traditonal" homeowners insurance companies still do not offer vacant homeowners insurance products, even to long term and existing customers.

In most large homeowner's insurance companies the product does not even exist. In most States, clients are forced to go into the specialty market and the surplus lines market to purchase a decent vacant home insurance policy.

For those that own a home that is expected to be empty for over 90 days, the same "buyer beware" advice exists today as it did four years ago. If you are shopping for vacant homeowners insurance please be aware that most policies are limited and in scope and not full, all risk, vacant home insurance policies.

What's more, these limited policies are still expensive. When looking for a policy make sure it's an all-risk vacant home insurance policy and it's also a replacement cost policy.

June Economic News Means More Vacant Home Insurance Needed

With today's horrible jobs and employment numbers, it means the economic recovery is at best stalled, and at worst, the U.S. could "double dip" back into recession. Houses on the market are not selling, and many are sitting empty.  Vacant homeowners insurance is a necessity for any house that is on the market sitting empty or unoccupied for over 3 months (this is true in most States.)

The big homeowners insurance companies do not sell vacant home insurance in most U.S. States. Those selling a home, and the home is currently not occupied by the owner or at least, a tenant, need to find vacant homeonwers insurance in the marketplace.

In most States, there may only be 3 or 4 insurance companies that even offer vacant homeowners insurance, and where the product is offered, the coverage is often very limited and not an HO3 "all risk" insurance equivalent.

If you can secure an "all risk" vacant home insurance product, expect the premium to be about 4 x as much as the premium you were paying when living in the home.

Vacant Home Insurance and Kidnap Insurance Two Most Overlooked Insurance Plans For Expatriates

A recent survey reveals that vacant home insurance and kidnap insurance are the two most overlooked insurance policies needed by many expatriates today.  At the top of the list on the minds of expatriates is international medical insurance, global dental insurance, and global property insurance.

Vacant home insurance is a special type of homeowners insurance coverage for expatriates that have an empty, vacant, or unoccupied house back in the United States (or any home country).  This situation always requires special coverage.

Kidnap insurance is a type of insurance that pays a ransom benefit and provides international consulting services in the unfortunate event an expatriate or family member is kidnapped in a host country.  Kidnap insurance may or may not be provided by the expatriate's employer.

Vacant homeowners insurance is not purchased by most expatriates because 90% do not understand this special policy is necessary.

Vacant home insurance for cabins

In the past month we have been asked several times to secure vacant home insurance for cabins. A cabin, in this instance, is defined as a remote house of any kind of construction, not just log construction, that has no access to public water and sewer. Also, in most cases, a cabin is in a remote location that is more than 5 miles from a volunteer fire company and more than 5 ,000 feet from a fire hydrant.

In all cases, cabins without access to electricity and running water, and / or using a propane or gas generater are not eligible for vacant home insurance. Cabins with electricting and running water from a well, will be looked at on a case by case basis.

Cabins with access to well water, septic sewer, and electricty and often hard to insure for vacant home insurance because it's quite common for them to be over 10 miles from a volunteer fire company and well over a mile away from a fire hydrant.

Property Management Services for Vacant Homeowners Insurance?

One of the most common questions we get from clients that purchase vacant home insurance is the following, "do I need to hire a professional property management service to take care of my vacant home in order to satisfy the terms of the vacant home insurance" (also called vacant homeowners insurance.)

The answer is no. However, the home does have to have regular "inside" visits, typically 4 a month or the vacant home insurance policy will become void. A professional does not need to perform the service.

A neighbor, friend, or relative can perform the service which includes inside visits as well as basic property management like mowing lawns and clearing walkways among other things. If a house is not maintained, the vacant home insurance policy can be void, or any claims will be denied if the claim adjuster says the house was not maintained properly.

Those moving overseas should consider a vacant home insurance policy

Many Americans and Canadians that take jobs overseas, and the overseas assignment will not last longer than 3 years, most likely will not sell their home meaning they may need vacant homeowners insurance. The first instinct will be to try to rent the home. Many traditional insurance companies that provide landlord policies to those that rent their home will not extend this coverage to anyone that will not be living in the country. Quotes for vacant home insurance or a landlord policy will be limited if you are leaving the country.

XN Financial has a vacant home insurance policy that can be offered to those living abroad that keep a home empty or vacant in the U.S. or Canada. However, if the home is going to be rented and the person about to live abroad is having difficulty finding an insurance company to provide a typical landlord policy, a vacant home insurance policy (or vacant homeowners insurance program) can be offered with a discount for these individuals. A vacant home insurance policy therefor works in both situations.

Heat Wave Planning for Clients with Vacant Home Insurance

Clients that have vacant home insurance policies generally do a good job maintaining a house for the 6 month to one year period it is empty or unoccupied. This means they generally have a property manager, have someone visit the home, or trust a reliable college student down the street to make sure the snow is shoveled and the bushes are trimmed.

However, one big mistake people make, and this can lead to damage in high heat, is to have a vacant home sealed up very tight with little to no air flow. If there is any source of moisture in these situations the home can become a breeding ground for mold and mildew. These mold and mildew claims are not covered by vacant home insurance or for that matter most homeowners insurance policies in most States.

Whenever possible a dehumidifier should be running in the basement at all times. The only way this is possible is for the dehumidifier to empty into a drain or if someone is entering the home at least once every 48 hours to empty the unit.

If this is not possible the house should not be sealed up ultra tight. The good news is, even if all windows are shut most (especially older) homes have at least some air flow on all levels of the house.

When Property Management is Recommended

Vacant home insurance now recommends hiring a professional property management firm to take care of a house that is not occupied or considered "vacant" by the insurance company in two situations:

1. The person owning the vacant home is not living in the State and the house is expected to be vacant or empty for over six months or longer.
2. The home is expected to be vacant or empty for over one year, no matter where the owner is.

Of course, an American living overseas on a company job assignment would qualify for both above and almost always should have hired a professional property manager to take care of a vacant home.

Vacant home insurance policies do not require that people hire a professional property management service. If the person owning the home has a relative or close friend that is very reliable that can come over and visit or service the property 4 or more times a month the terms of the vacant homeowners insurance policy can be satisfied. However, if the person you are trusting to take care of the empty or unoccupied home is not perfectly reliable and the upkeep on the property begins to go down hill, there is a risk the vacant home insurance policy could deny claims based on what is called "neglect"a common exclusion in a vacant home insurance policy.

XN Financial Vacant Home Insurance Policy, a Perfect Hybrid

One of the unique features of the vacant home insurance product offered by XN Financial Service, Inc is their vacant home insurance product is a true hybrid. What does that mean for the purchasers of vacant homeowners insurance and more importantly for people living out of State or even abroad?

If a home is empty of vacant, the ONLY way to cover it is through a vacant home insurance policy. If a home is going to be rented, a homeowner would need to put in place a landlord tenant policy. In the past, homeowners had to flip policies back and forth as they got a renter, lost a renter, and so forth. A real hassle, especially for someone living overseas.

If someone purchases our vacant home insurance policy and then they get a renter in the house, there is very little they need to do. The policy can remain in force. On the other hand, if the house is being rented and the renter leaves, there is no need to cancel the policy and find a new policy which is very labor intensive. The insured can stay with this policy. They would simply have to inform us that the house is now empty. The main advantage; the policy would not have to be re-written.

Vacant Home Insurance Questions in Light of Japan Earthquake and Nuclear Problems

One of the markets we serve for vacant home insurance is Americans living and working around the world. In light of the current situation in Japan we have been asked to clarify a few points relating to coverage for vacant homeowners insurance. Although we feel our insurance for vacant homes is the absolute strongest on the market, these two perils are not covered as standard, nor are they covered as standard by any policy in the entire market that we know about.

The peril of Earthquake is not covered as standard. This is true with this vacant homeowners insurance policy and all homeowners insurance policies in the United States. In some instances, we and other insurers can cover "earthquake" as a special rider or endorsement but it is not covered as standard.

The peril of nuclear hazard is not covered. Again, this is standard across the industry.

This applies to all vacant homeowners insurance policies issued and vacant condo insurance policies. Please call us if there are any additional questions.

Vacant Home Insurance Now (.com) Featured in the Philadelphia Inquirer Newspaper

Here is a clip from the article on vacant home insurance, March 11, 2011: In the 4th quarter of 2010, 12 percent of all US residences, or 18,394,000, were vacant. Record foreclosures are a big reason for this: After repossessing houses at sheriff's sales, many lenders leave them empty for months.

But even properties that aren't distressed may take a long time to sell after the owners move on. In the Philadelphia region in January, time on the market averaged 103 days, according to a Prudential Market Report.

All of which makes a difference in the kind of insurance coverage such unattended or vacant houses require - coverage that isn't offered in the standard homeowners' policy.

Vacant Home Insurance Now, which offers policies in several states, says up to 80 percent of homeowners do not know that "the provisions of their existing homeowners' insurance policy . . . would essentially end coverage, exposing them to catastrophic loss."

Vacant homeowners insurance is even more important in 2011 and 2012 as foreclosures are expected to increase.

Some Homeowners Insurers Offer Vacant Homeowners Insurance but at Ridiculous Prices

It is true, when it comes to vacant home insurance there are not a lot of choices in the marketplace of most States. We have recently heard that, in order to increase profits, some homeowners insurers will offer up to a year of coverage for vacant home insurance but at ridiculous prices, making clients feel they have no other choice.

The cost of vacant home insurance is high to begin with because of increased risk and fewer market choices, but the cost some companies are "offering" to clients to keep the home insured after it becomes empty or vacant is astronomical. What's more, we have seen the level of coverage drop from an all risk policy to what is called a dwelling policy for vacant homes, a limited policy form.

Even if the company agrees to keep the home insured at a more reasonable cost, make sure you get a completely new policy document that proves you have coverage on the empty or unoccupied home. We advise you strongly, do not simply take the agents word for it. Normal homeowners insurance policies are not set up to provide vacant home insurance and many exclude even short term vacancy.

In almost all cases where the home goes empty, seek out an insurance policy that is designed to meet your exact needs not a square policy someone is trying to use for a round hole to make a little more quarterly profit.

Note to Policyholders who are Expatriates living in Egypt

Vacant Home Insurance Now has programs specifically created for expatriates that are living outside their home country and that maintain a vacant or unoccupied house in the home country. In most cases, vacant home insurance is needed while an individual is working on international assignment if the home will be unoccupied for over 90 days.

We would like all clients to know that if vacant homeowners insurance is in place, and due to political unrest like we are seeing in Egypt, a policyholder is forced to return and live in the insured house there is no change in the insurance and vacant home insurance (full coverage) will continue uninterrupted.

In other words, due to these and other situations, coming back to live in the house thus making it occupied again, does not void the policy if the house will again be vacant in the future.

If you plan to live in the home permanently and not return to your country of assignment, we ask that you contact us when you can to discuss.

Thank you.

Note to the Public, A Boarded Home Does Not Qualify for Vacant Homeowners Insurance

We have received a lot of calls about homes that are either abandoned, boarded up, in disrepair, or all three. We have to note again to the public that our underwriters will not consider a home in this condition for vacant home insurance.

Homes that receive quotes for vacant home insurance need to be in good or better condition, livable in every way, and not in need of any major repair or be under any current construction.

Homes that do not qualify for vacant home insurance for these reasons should investigate their State's "fair plan" insurance solutions that have much lower qualifications. The "fair plan" insurance solutions vary by State and the standards on what they are willing to accept will also vary if vacant homeowners insurance is requested for houses that are no longer occupied.

Vacant Home Insurance Renewal Policies

As a notice to existing customers, if you have a vacant home insurance policy in effect at this time, you can renew vacant homeowners coverage by working with XN Financial directly at www.xn.com or 514-908-1835.

XN Financial Services, Inc. of Montreal and Boca Raton Florida can work with insureds directly at the end of their term of insurance for vacant home insurance or vacant condo insurance to offer another insurance term of 90 days, six months, or one year.

Renewal rates for most customers have not increased more than 5% in the last two years. Some clients have not had rates increased at all. Most clients that wish a new renewal period for any vacant home insurance policy simply need to call XN Financial. In most cases, the entire renewal can be done over the phone with no new paperwork.

Expatriates That Need Vacant Home Insurance May Also Need the Following

We are contacted by hundreds of expatriates a month, leaving their home country to take an international assignment for their employer. Those that call about vacant home insurance may also need the following personal insurance that is not typically provided by the employer unlike international medical insurance and international workers compensation insurance and other things that are provided by the employer.

First on the list is international property insurance. Personal effects and possessions taken into the host country are not covered by an employer's commercial policy. Furniture, clothing, ipod, and even the kid's toys needs to be protected globally and in the host country from fire, theft, vandalism, smoke, flood, etc. If a fire comes and your are out $100,000 don't expect the employer to step into the rescue. There are both legal and tax reasons why they cannot.

International personal liability needs to be purchased by the expatriate before the international assignment as well. This is basically "net worth protection" for the family as they live outside the home country. Although the incidence of lawsuit outside of the U.S. is lower than it is in the U.S., this coverage is still essential. One can cause damages for a variety of reasons that are not related to the work assignment. If not directly related to "work" the employer would not be able to step in and cover these personal lawsuits or damage awards. Good policies here also cover the legal fees in the host country and provide "trip" coverage back in the U.S.

Home country plans or vacant homeowners insurance in the U.S. only covers the dwelling. These policies would not cover the personal insurance needs of expatriates living abroad and separate arrangements need to be made past vacant home insurance.

Vacant Home Insurance Winter Checklist

As a final reminder to clients for the winter season, please make sure you are aware of all of the following regarding your vacant homeowners insurance or vacant condo insurance for the winter season.

1. Make sure the heat is on and set to at least 60 degrees or warmer.
2. Make sure the home is visited inside, at least once a week. Although the heat in the vacant condo or house could be on, boilers may not fire and heaters can break. Pipes can freeze in as little as 48 hours.
3. Make sure the water (at the main valve) is shut off. A water leak where the water could have easily been turned off, and where the underwriters have not approved that the water could remain on in the vacant home, can become a denied vacant homeowner's insurance claim.
4. Make sure snow and ice is cleared. You can be sued if someone is hurt and you did not keep up on the house with basic care and maintenance like snow removal.
5. Make sure pools and hot tubs are fenced and covered.
6. In lieu of keeping the heat on, the water pipes should be professionally drained of all water.

This is our winter 2010 - 2011 checklist for vacant home insurance and vacant condo insurance.

Largest Winter Claim for Vacant Homeowners Insurance

Now that we are quickly into the winter months, we would like to remind Vacant Home Insurance Now clients that the number 1 claim in the winter for many States is frozen pipes for vacant or empty homes.

All clients with vacant home insurance are not only expected to visit the property (or have someone visit) 4 times a month or more, but either the heat must be left on or the pipes need to be totally removed of water so they do not freeze.

If heaters in the home are left on they need to be checked. Oil burners can find dead spots and not "light" leaving the temperature in the home to drop. In some States, a home without heat can have frozen and burst pipes in under 48 hours. Those with vacant home insurance would only have coverage for this claim if they took the proper care and could demonstrate they had left the heat at 58 or above, and had someone or a property management service regular check the property to keep the vacant homeowners insurance valid.

Neglect is a reason to deny a claim and frozen pipes can easily cause over $25,000 in damage.

Of course, those with vacant home insurance should have the main water supply off whether the pipes are drained of water or not, and this helps control damage if pipes freeze.

When renewing vacant home insurance or vacant condo insurance, make sure you inform the mortgage company!

Clients than have purchased vacant home insurance should not wait until the "last minute" to renew the vacant homeowners insurance policy. The reasons have to do with the demands of the mortgage company.

In most cases, vacant home insurance can be renewed just a few days before the lapse date or termination date but we don't recommend this. Although there may be no lapse in coverage it can take a week or two for the client to receive the documentation paperwork like the declarations page for vacant home insurance.

If the client has a mortgage, it is up to the client to always be able to demonstrate to the mortgage company that good insurance exists on the property, vacant homeowners insurance or otherwise. It's within the right of the mortgage company to secure forced placement insurance coverage if they believe the client has been delinquent in their duty to always protect the house with good insurance coverage.