Monday, July 5, 2010

Insuring Vacant Property on the Market

It's unfortunate that the staged home has to have something so inhospitable, but what's a vacant property owner to do?
Major shock last Friday.  The builders insurance we took out on the property does not cover damage due to water from inside the property.  Don’t you love the way insurance companies make it work for them?  They don’t get to build those skyscrapers by helping ordinary folks.

Here is the list of what they DO cover: Fire, lightning, explosion, windstorm, smoke, aircraft or vehicles, riot or civil commotion, vandalism, sprinkler leakage, sinkhole collapse, and volcanic action.  If only that volcano that triggered the sinkhole collapse that led to the civil commotion and explosions had caused the sprinkler damage and consequent vandalism that broke the toilet part, maybe we’d be covered.  But probably not.      

I am sick that we will have to eat the entire cost of this cleanup. We talked to Mr. Make-it-right and he’s agreed to work with us to keep costs down.

And you know what really fries my grits, as we say in the South?  Today at our supermarket we happened to park next to a brand new Cadillac SUV.  And its vanity license plate was the name of the local company that sold us this insurance policy.  That’s right.  We helped some undeserving leech buy that gas guzzler.

That’s fried grits.

To find out what other homeowners and real estate investors have done to get insurance for an unoccupied residence, I went online.  One of my favorite sources of information is
http://ths.gardenweb.com/forums/realestate/.  The forum is called “Buying and Selling Homes.  It’s an active forum, one populated by knowledgeable investors, legal types, realtors, as well as buyers and sellers at every level of experience.  I recommend checking in often if you are a home seller.  I know you will lean new things with each visit. 

What I learned is that it is almost impossible to insure a vacant property.  At best, it’s expensive.  What some forum posters suggested to me is to call it a rental property, but others suggested that such an approach could backfire if it becomes obvious that no one lived in the house and you have a claim. 

So, there’s just no easy answer, except to turn off the water, either at the main valve, or at least at the toilets.  That’s what we’ll be doing henceforth.

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