Understanding Unoccupied Property Insurance During the Probate Stage Could be Crucial in Your Future
As an executor, you want to ensure that the deceased’s property is protected during the administration of the estate. You do not wish problematic experiences before or when the property is to be distributed to beneficiaries.
Typically, an unoccupied property is exposed to various problems, ranging from artificial to natural. The assets begin to fail and could run into several thousand to millions if an executor is not doing the right thing early. The right thing is to obtain unoccupied property insurance to avoid being personally liable for estate damages.
What Unoccupied Probate Insurance Means
After a property owner has passed away and someone has the responsibility of dealing with the administration of the estate, which is also often called probate, the estate can remain unoccupied for some time.
Unfortunately, the insurance coverage may not be applicable for a vacant property after a particular period, typically 30-90 days. The insurance company can either withdraw or reduce/revise the policy. The revision often ensures restrictive terms and conditions that leave the executor of the unoccupied estate on the verge of being responsible for damages.
How Unoccupied Home Insurance Can Save You Unnecessary Expenses
Unoccupied home insurance can protect an estate in many ways. It is like a standard homeowners insurance policy, except that it involves a vacant property this time. An unoccupied home insurance policy can protect the property from events, including vandalism, fire, destructive wind, lightning, theft, and hail.
When a property is vacant, the risk of damage is considered higher by an insurance company than property occupied. The reason is that nobody is there to look after the property, meaning that natural (flood, hail, etc.) and artificial causes, such as vandalism and theft, can occur without anybody knowing. Since there is no regular preventive measure and upkeep, damages are left unnoticed, and they could run into expensive costs over time.
What an Executor Can Do to Keep the Empty Property Protected
If you are an estate executor, and the estate is unoccupied, do the following:
1. Find Out About the Existing Coverage
An unoccupied estate that becomes unoccupied reflects in the insurance. As an executor, you want to be wary of the existing insurance policy. Although the deceased may have had adequate property cover, the insurance company will need you to update the policy or apply for new coverage. You want to take note of the updated policy and be sure you find it comfortable. Otherwise, new insurance is needed during the probate stage.
2. Review the Revised or New Policy
It is most likely that the insurance company will require regular inspections. They expect you to obtain comprehensive cover since the home is unoccupied, considering the risks. If you fail to update or get a new policy, any resulting damage you claim will be rejected.
However, if the probate home is on the market, the estate agent completed what the insurance company requires at an additional cost.
As an estate executor, you are responsible for making sure that you comply with the conditions of the insurance policy to protect the estate in the future, such that you do not run into personal costs that can be expensive.
A new or revised policy must be in your name as the estate executor. It does not make you entitled to making claims or receiving the benefits of claims under the coverage. Putting the insurance in your name means you can receive notifications when the policy lapses or is cancelled.
3. Determine Whether the Current Insurer is Worth it
If the current insurer is not worth it, you want a new insurer with the appropriate experience in probate properties. Specialized probate insurance understands your position as an executor and knows the responsibility you handle and can optimize the policy suitably.
If the money on the estate is limited, you may find it challenging to pay the premium. A specialist insurer offers features, including giving you a period of grace where unoccupancy conditions will not apply. You also get to defer payment of the premium until you get money from the estate.
4. Watch Over the House
When you obtain the appropriate unoccupied insurance policy for the estate, make sure the home is always secure. You will make time for inspections. Store valuable items in safer places and disable all utilities until the property is distributed to the beneficiaries.
It is important to keep a record of every item and where you store them. Also, it does not end at safekeeping the items. Make sure to visit the property regularly for inspection.
What Determines Your Unoccupied Insurance Cost?
The amount you pay for unoccupied insurance depends on many factors.
- Crime level. If the property is in a high-crime area, you could be paying higher. For example, Cleveland tops the UK’s blacklist in crime. It toppled West Yorkshire as the most dangerous area, so you expect higher rates in such an area.
- Vacant property. If the property is vacant, it is more vulnerable than where the property is inhabited. Moreover, homes that are well-looked deteriorate over time when nobody stays there to detect problems earlier. Vandalization and burglary may go unnoticed, which increases the repair cost.
- Unoccupied period. Properties that remain vacant for long periods can influence your premium.
When selecting a policy, make sure to compare policy covers of various insurance companies. If there are additional covers, it means a little cost is added to the protection.