Holiday home insurance explained
If you’re lucky enough to own a second home, holiday home insurance can keep your property protected – even when you’re not there
Do I need holiday home insurance?
Owning a holiday home can be a dream come true. It's a place to escape, to make memories with family and friends, and perhaps even to generate rental income. But with the joys of a second home come responsibilities, particularly when it comes to insurance. If you have a second home, it’ll face the same risks as your main home, so you’ll need insurance if you want to protect it. Most standard home insurance policies won’t cover a holiday home – but you can still find a specialised holiday home insurance policy to keep your second home protected.
Why standard home insurance isn't enough
Ordinary home insurance cover isn’t enough because insurers usually insist that any property they cover isn’t left empty for more than 30 days a year, ruling out most holiday homes. This 30-day limit is a common feature in standard policies, which doesn't align with the reality of how holiday homes are used. They are often left vacant for extended periods, which increases the risk of burglary or damage. Imagine a scenario where a pipe starts leaking in your absence, and you only discover the issue after significant water damage has occurred. This is precisely the type of situation holiday home insurance is designed to address.
Understanding holiday home insurance
Just like ordinary home insurance, holiday home insurance has two parts: buildings cover and contents cover. However, if you rent out your holiday home to other people, there are other elements to be aware of.
This type of insurance is crucial as it protects the physical structure of your holiday home and its permanent fixtures against damage from events like fire, storms, and flooding. If you have a mortgage on your second property, lenders will typically require you to have buildings cover. But even if your holiday home is owned outright, it's a prudent measure to protect your investment.
Contents insurance isn’t mandatory, but you should also consider it. You probably don’t keep as many expensive possessions at your holiday home, but it’s still worth protecting whatever you do have – especially as the risk of burglary is more severe at a regularly unoccupied property.
Additional considerations for rental properties
If you're renting out your holiday home, you'll need to think about holiday lettings insurance. This covers risks like accidental damage and theft that can occur when guests are staying in your property. Accidental damage coverage could be particularly useful if you regularly have guests – they’re not always as careful as owners. Moreover, if you employ staff such as cleaners or gardeners, employers’ liability insurance might be necessary.
What should my holiday home insurance cover?
Your holiday home insurance should be comprehensive. Here are some additional coverages to consider:
Loss of Income: If property damage leads to canceled bookings, this coverage can help recover the lost earnings.
Alternative Accommodation: Should your property become uninhabitable due to damage, this covers the cost of relocating guests.
Public Liability Insurance: Public liability insurance is essential as it covers legal fees if someone is injured or dies on your property.
Always read the policy document thoroughly to understand what is included and what exclusions may apply.
Insuring overseas holiday homes
Can you get holiday home insurance if your second home is in another country? Yes, many providers offer coverage for properties abroad, though it's often limited to certain countries. Be aware that insurance rules can differ for overseas properties, and there may be specific exclusions, like earthquake damage in certain regions. Sometimes, opting for a local insurance firm can be beneficial, but ensure they are reputable and provide policy documents in English.
Reducing the cost of holiday home insurance
Looking to save on your holiday home insurance? Here are some tips:
Maintain your property: Keeping your home in good condition can prevent disrepair and protect against weather damage.
Enhance security: A burglar alarm and secure locks can deter thieves and may lower your premiums.
Increase Your Excess: A higher excess can result in lower premiums, but make sure it's an amount you can afford if you need to claim.
Use one insurer: Bundling your buildings and contents cover with one provider can offer savings.
Pay annually: While monthly payments may seem easier, paying your premium annually can be more cost-effective.
Finding the right provider
When it comes to choosing a provider for your holiday home insurance, it's important to compare your options. MoneySuperMarket partners with leading insurance providers, offering links to current partners for those seeking a suitable deal.
Owning a holiday home should be a source of pleasure, not stress. With the right holiday home insurance in place, you can rest easy knowing that your second home is protected, leaving you free to enjoy its benefits. Whether you're basking in the summer sun or renting out to holidaymakers, ensure your investment is secure for all the good times ahead.