What Should Secondary Home Insurance Cover?
Typically, secondary home insurance will provide the same coverages as your primary home insurance plus more, depending on how you plan to use the property to be insured.
Landlord Insurance for Rental Properties
If you are planning to use this second home as a source of income and rent it out, then you should look for landlord insurance, which is coverage tailored specifically to protect the home in this use case and also any potential loss in income. To further protect your home, you can request that tenants get renters insurance. In some states, like Florida, a landlord can require their tenants to get renters insurance.
Builders Risk Insurance for Investment Properties
If you purchased a second home as an investment with the plan to renovate and flip the property down the road, then builders risk insurance may make the most sense to have while renovations are underway.
Vacation Home Insurance
Another common scenario is using the home as a vacation getaway or somewhere you live part-time due to work travel, family, or other reasons. With this type of insurance, you’ll notice many similarities to your primary home insurance policy —just remember that you must let your insurer know that this property is a second home and not your primary home. This is an important distinction that, if ignored, could result in loss of coverage should you need to make a claim.
Vacant Home Insurance
If you have a second home but don’t have plans to use it as a vacation home or a rental property, you may want to look into vacant home insurance. Most insurance companies will consider a home to be vacant if nobody lives in it for at least 30 days or more. This type of insurance is designed to help cover you from events such as theft, vandalism, fire, or certain natural disasters, such as tornadoes or wildfires.
Secondary Home Insurance Coverages
Here are the types of coverages you can expect to find in a secondary home insurance policy:
Dwelling coverage: This covers the structure of the home against hazards like fire, weather-related damage, and burglary.
Other structures coverage: This will cover the additional structures on your second home’s property, such as sheds, detached garages, fences, or boat docks.
Personal property coverage: This will cover personal belongings like furniture, kitchenware, and clothing.
Personal liability coverage: If someone is injured on your second home’s property, this will cover the legal and medical expenses if you’re found to be legally responsible for said injury.
Loss of use coverage: If your second home becomes uninhabitable for an extended period of time (for example, if your home is affected by a natural disaster and needs to be rebuilt or undergo renovations), this may cover expenses like hotel stays, storage facility costs, and more.
Additional Coverage to Consider
If you have a second home located near the water, such as a beach house or lake house, then you’ll likely need (and want to) get flood insurance to protect from potential water damage. Most homeowners insurance policies do not come with flood coverage, so if you are concerned about the possibility of flood damage, you’ll need to get a separate flood insurance policy.