Vacant Homes In Probate
We often see vacant homes in probate. The owner has passed away and nobody quite knows that is going to happen with the house. This raises an issue. What to do about insurance?
Here’s the issue. At some point a home that is vacant may need a specific type of insurance policy called a dwelling fire policy. I say may because this is different based on the insurance carrier. So if Bob is the only person living at his house and he passes away, Bob’s family is going to notify the insurance agent right away. The insurance agent is probably going to tell Bob’s family one of two things. (1) We can continue to insure Bob’s home until the policy renews even if the home is vacant. But after that, someone is going to need to stay over a certain number of nights per month or you’ll have to purchase a dwelling fire policy. (2) OR the insurance company might say, because the home is vacant, we need to get someone to live there or write a dwelling fire policy right now.
So what do you do as a family member? If someone is able to stay there, find out what the requirements are for the home to be considered occupied. Maybe someone needs to stay over a certain number of nights per month and there is a family member who can satisfy this requirement. BUT YOU ACTUALLY HAVE TO FULFILL THE REQUIREMENT. If the insurance company knows the home is vacant, and there is a claim, you can bet your bottom dollar that the insurance company is going to pull the doorbell camera footage from the house across the street to ensure that someone was staying over the amount of nights required by the policy.
The dwelling fire policy isn’t the best option for the long term. It’s really coverage for fire only and that leaves a lot of risks uncovered. The insurance company has more risk when someone is not living there because nobody sees a sump pump failure, a furnace failure, hail that blows through a window, etc.
It’s not impossible to deal with vacant homes in probate from an insurance perspective. But there are some additional considerations.
