Vacant Property Insurance Ontario

Vacant Property Insurance Ontario

If you're a property owner, you likely already have a homeowner policy or commercial insurance. If you have a mortgage or a commercial loan, your lender would have required you to purchase insurance before approval. Even if you own the property outright, it’s wise to assess your insurance needs and ensure proper coverage.

However, if you own a building, whether a home, rental property, estate, or commercial space, that is empty for a prolonged period, your standard insurance policy likely will not cover it. You’ll need the added protection of vacant property insurance or vacant home insurance. In Ontario, depending on the insurance provider and your policy terms, a building left empty for too long may not be insured at all. That’s where vacant home insurance comes in.

What Is Vacant Property Insurance?

Essentially, if you own a property that is vacant for a set period of time (usually around 30 days) you need vacant home insurance. Most homeowner insurance policies and commercial insurance policies do not cover empty buildings. Standard insurance is designed for properties that are occupied and maintained.

Without regular occupants, vacant homes, estates, rental units, and commercial spaces face increased risks. There is no one to maintain the property, check on utilities, or address minor issues, which makes the property more susceptible to:

• Vandalism or property damage
• Fire or explosion (fire coverage)
• Water damage
• Liability issues (liability coverage)

It is essential to inform your insurance advisor as soon as a property becomes vacant, otherwise you risk having no coverage and being personally liable for any damages.

Which Properties Are Eligible for Vacant Property Insurance?

Vacant property insurance is necessary for residential and commercial property owners in specific situations. Examples include:

• Estates awaiting sale
• Rental properties that are unoccupied between tenants
• Commercial spaces or business premises that remain empty for extended periods
• Properties undergoing minor cosmetic renovations
• Extended absences leaving the property empty

Notifying your insurance provider promptly is crucial to avoid gaps in coverage. This section covers the main eligibility scenarios and common situations that require vacant home insurance.

How Long Can I Leave My Property Unoccupied?

Most vacant dwellings require vacant home insurance if they remain empty for 30 days or more. If your property is unoccupied for over 30 days, your insurer can void your home insurance policy and deny any claims. It's essential to inform your insurer about your absence before that 30-day period begins to avoid being stuck in this situation.

For example, if you are performing home renovations or preparing an estate for sale, you should notify your insurance advisor before the 30-day period ends. They can advise whether the property will be classified as an unoccupied property or vacant based on:

• Duration of vacancy
• Property type and location
• Utilities and maintenance status

What’s the Difference Between an Unoccupied and Vacant Property?

• Unoccupied properties: These can be lived in at any time and are expected to be occupied soon. Examples include rental properties between tenants or commercial spaces awaiting tenants.
• Vacant properties: These are fully empty, with utilities disconnected, no furniture, and no ongoing activity. Examples include estates awaiting sale, homes in transition between owners, or commercial properties awaiting new leases.

Different insurance providers have different guidelines, so it’s important to work with a licensed insurance advisor to find coverage tailored to your specific property and coverage needs.

What Is Covered With Vacant Property Insurance?

Vacant property insurance coverage varies per provider, so it's best to ask your Morison Insurance broker to review your policy's specifications with you. However, vacant house insurance may include some of the following types of coverage:

• Explosion and Fire Coverage: A fire breaking out at your vacant property is a big insurance risk and would be absolutely devastating if you're not insured. With a vacant property insurance policy, you can rest assured that you'll have financial coverage to repair or replace the damaged building in a fire or explosion.
• Hail, Lightning or Windstorm Damage: Extreme weather events can wreak serious havoc on your vacant home. Usually, a vacant property insurance policy will cover property damage from certain weather events up to the coverage limits.
• Premises Liability: A vacant home can be more vulnerable to unauthorized entry and unsafe conditions, increasing the likelihood of someone getting injured. This coverage addresses the increased risk by providing financial protection from costs of legal claims and medical bills if injured on the vacant property.

Additional Coverage Options for Vacant Properties

Also, there will be additional coverages that you can usually purchase as an add-on endorsement to vacant property insurance plans. A couple of these add-ons may include:

• Sewer Back-Up Protection: Often, flooding sewers are not covered under a standard vacant property insurance policy. However, backed-up sewage can cause devastating damage to empty homes, especially if no one is there to check on the property frequently. However, this coverage can usually be added to your vacant property insurance policy.
• Water Damage Protection: Similarly to backed-up sewer protection, many types of water damage—such as overland water damage—are not covered by a standard policy for vacant property insurance. Ontario property owners should also note that some types of water damage, say from a frozen pipe that burst over the winter, may not be covered because it's assumed that amenities should be turned off or that regular maintenance upkeeps the property's pipes.
• Earthquake Protection: If your property is in an earthquake zone, then you should inquire about adding this protection to your vacant property insurance policy. While not all insurers offer it, it's always worthwhile to ask.
• Sprinkler Leakage: Does your property have built-in sprinklers? If these sprinklers leak, they could cause serious damage to your home while you're away. Protect yourself from this risk by adding this coverage to your vacant property insurance policy.

Choosing the Right Vacant Property Insurance Provider

Vacant home insurance can be purchased as:

• A separate policy for properties that will remain vacant long-term
• An endorsement added to your existing homeowner policy or commercial insurance policy for short-term vacancies

A licensed insurance broker will help determine the best option based on whether your property is:

• A rental unit
• An estate awaiting sale
• A commercial space or business premises
• Undergoing home renovation or minor cosmetic upgrades

Your insurance advisor can also help ensure coverage matches your risk management goals, liability coverage, and insurance needs.

Is It Necessary to Insure Land That Doesn't Have a Building On It?

If you've got a parcel of land that doesn't have any actual structures built on it, that's a different matter—insurance coverage is still recommended. Still, you would need vacant land insurance rather than vacant property insurance. Ontario property owners don't always consider insuring vacant land. Still, it's essential to have liability coverage if something happens on the land to cause bodily injury or property damage that you could be liable for.

That's true for any vacant land, but particularly for packages of land that are attractive to trespassers, whether they know they're trespassing or not. For example, if your land is situated in such a way that it makes a convenient shortcut between two points or if it features natural beauty that attracts people who want to check out the views. If someone was injured on your land—a hiker who stumbles and falls down a steep embankment, for example—you could have legal action brought against you and be liable to pay settlement costs. If you have vacant land insurance with liability coverage, your insurance company will provide funds to cover your legal costs up to the limits on your policy.

What Does Vacant Property Insurance Cost?

The cost of vacant home insurance varies depending on the insurance provider and property specifics:

• Property type (residential, rental, estate, commercial)
• Property size and amenities
• Vacancy reason
• Coverage limits and deductibles
• Risk factors (location, proximity to fire services, etc.)
• And more

To get an accurate vacant property insurance quote, contact the expert brokers at Morison Insurance. We will compare quotes from leading insurance companies to get the coverage you need at the right price.

What Questions Will My Broker Ask About My Vacant Property?

Ontario brokers at Morison Insurance will ask many questions when applying for vacant property insurance to get more information about your property and your unique risk exposures. Some of these questions may include:

• How frequently is the property being checked?
• Is there a fire hydrant within 300 metres?
• Is there a firehall within eight kilometres?
• Is it a voluntary firehall?
• Will utilities be maintained?
• Is there a sump pump?
• Is there a pool and/or hot tub on the premises?
• Are there more than six parking spots on the premises? If yes, then how many?
• Is the lot bigger than one acre? If yes, then how many acres?
• Is the risk located in an active flood zone?
• Is the risk located within 50 kilometres of an active fire zone?
• Does the building have a heritage designation? Is this limited to the building's facade?

How Can I Mitigate Vacant Property Risks?

Even with insurance, it’s important to reduce risks. Here are some ways to reduce vacant property risks:

• Schedule regular property inspections for residential and commercial spaces
• Install security systems, security measures, and monitored video surveillance systems
• Maintain utilities, heating, and plumbing as appropriate
• Ensure fire prevention systems are operational (fire coverage)
• Keep the property maintained to deter vandalism and squatters

How Can I Get a Vacant Property Insurance Quote?

If you're interested in acquiring a policy for vacant property insurance, Ontario brokers at Morison Insurance are available to consult with you and get started on a quote. Any member of our highly skilled team will be able to help you find vacant property insurance coverage that is ideal for your needs. To get started, fill out the online form below or give us a call at 1-800-463-8074.

Frequently Asked Questions About Vacant Property Insurance

Does vacant property insurance cover both homes and business spaces?

Yes. Coverage applies to residential homes, estates, rental units, and commercial properties that are empty for extended periods.

Do I need vacant property insurance for a property being sold or undergoing renovations?

Yes. Even temporary vacancies during property sale or home renovation require proper coverage.

Can I cancel vacant property insurance once the property is occupied again?

Yes. Policies can be adjusted or canceled once tenants move in, new owners take possession, or commercial space reopens.

How can I reduce vacant property insurance costs?

Implement risk management strategies: schedule regular property inspections, install security measures, security systems, or video surveillance systems, and maintain utilities.

Is vacant property insurance more expensive than standard coverage?

Yes. Empty properties carry higher risks of property damage or vandalism, and premiums reflect this increased risk.

Is vacant land insurance the same as vacant property insurance?

No. Vacant land insurance covers liability risks on undeveloped land, while vacant home insurance protects empty residential and commercial spaces.