Is My Home Covered While Unoccupied?

Have you ever wondered what happens to your home insurance when nobody's living there? For example, you go on an extended holiday, you have trouble securing a new tenant in your investment property once the old tenants move out, or you move out of your home while completing renovations?

When a home is unoccupied for extended periods of time there is a greater chance of loss or damage so insurers see this as an increased risk. The good news is that once you have taken out a policy with Budget Direct, we will allow up to a maximum of 180 days of unoccupancy (subject to their acceptance criteria). An additional excess and conditions may apply depending on how long the home will be unoccupied.

• 0–60 days unoccupied: Standard policy applies and full cover
• 61–180 days unoccupied: Cover continues, security and safekeeping conditions apply, and an additional excess applies when making a claim
• 180 days+: Cover ceases.

Firstly, let's clarify what an unoccupied home means to an insurer. As per Budget Direct's Home PDS, 'unoccupied' means no one is sleeping or living in the home for more than two days (including overnight) or someone is living in your home without your consent. Some examples of an unoccupied home include:

• Extended overseas holidays
• Renovations where you've moved out temporarily
• Investment properties between tenants
• A second home you only visit occasionally

Refer below to how the period of time your home is unoccupied can affect your policy.

• 0–60 days: No change in cover or conditions
• 61–180 days: Cover continues but specific security and safekeeping conditions apply and an additional excess applies if you claim.
• 180+ days: No cover is provided and you would need to arrange alternative insurance.

Budget Direct applies an additional $1,000 excess on top of your standard basic excess for any claims you make after 61 consecutive days of vacancy. This means if your basic excess is $500, you'll pay a total of $1,500 for a claim on an unoccupied property.

Understanding why insurers have strict rules about vacant and unoccupied property helps you better protect your home. The most immediate concerns are theft and vandalism, as empty homes are attractive targets for burglars and even squatters.

There's also the devastating potential of undetected water damage that can lead to major loss or damage.

To maintain coverage, if your home has been unoccupied for more than 60 days, you must meet a specific set of requirements spanning four main areas. These are crucial conditions you must meet to ensure any future claim is not declined.

• Security measures – secure the home with:
  • All windows and doors must be locked.
  • Security alarms must be activated.
  • Have a trusted friend or family member hold the spare key.
• Maintenance and appearance
  • Gardens should be maintained and kept in tidy order with lawns mowed regularly.
  • Mail should be collected or redirected so it doesn't look like no one is home to potential thieves.
• Regular inspections
  • A trusted person must inspect the property regularly.
  • They should check for storm damage, water leaks, or signs of break-ins.
  • Keep records of these inspections in case you need to make a claim.
• Water precautions
  • Turn off the water mains supply and turn off individual taps for appliances connected to the water supply to prevent undetected leaks causing extensive damage.

Failing to meet these conditions could result in your claim being denied, even if you're within the 180-day unoccupancy period.

Here's a valuable tip: having a trusted person stay in your home for just two consecutive nights resets the 60-day occupancy timer. This means:

• You avoid the $1,000 unoccupied excess
• Standard policy conditions apply
• Your home stays more secure

A house sitter doesn't need to stay the entire time you're away – they just need to sleep over two nights in a row to keep your policy under the standard terms. This could be a friend, family member or professional house-sitting service, who also can water plants, deter thieves and spot problems early before they become major issues.

If something goes wrong while your property is vacant, take these steps:

• Report immediately: Contact Budget Direct as soon as you discover the problem, even if you're still overseas.
• Document everything: Take photos of the damage and keep any evidence of your security measures and regular inspections.
• Police reports: If theft or vandalism occurred, file a police report before making your claim. You'll need the report number.
• Proof of compliance: Be prepared to show you met all the occupancy conditions, including evidence of regular inspections and security measures.

Understanding the terms and conditions of home insurance for unoccupied homes ensures your property stays protected even when you're not there. By following the security and safekeeping conditions and staying within the maximum unoccupied coverage timeframe of 180 days means you can travel or manage your property with confidence.