How to Handle Insurance When Units Are Vacant

Owning or managing rental properties in Lake Oswego, OR comes with many responsibilities, and one of the most important is making sure your insurance coverage keeps up with changing circumstances. This due diligence may be especially important when a unit becomes vacant, as it can directly impact your coverage needs.

Understanding the Risks of Vacant Units

Vacant rental units can present unique risks compared to occupied ones. Without tenants, properties may be more vulnerable to various risks, including vandalism, theft, water damage, pest infestations and unnoticed maintenance issues. Insurance companies often view vacant units as higher risk, which can impact your coverage and claims process.

Insurance Considerations for Vacant Properties

Landlord insurance, also known as rental property insurance, is an essential investment for anyone who rents out properties. However, these policies may have limitations or exclusions for vacant units. Many arrangements may require you to notify your insurer if a unit will be unoccupied for a certain period, such as at least 30 or 60 days. Failing to fulfill these obligations could result in denied claims or reduced coverage.

Specifically, to address these potential coverage gaps, you may need to take the following steps:

• Add a vacancy endorsement or rider to your existing policy.
• Purchase a separate vacant property insurance policy.
• Adjust your coverage limits or deductibles based on the length of vacancy.

Best Practices for Protecting Vacant Units

In addition to adjusting and maintaining appropriate insurance, taking proactive steps can help minimize risks involving vacant units. Consider the following:

• Notify your insurance provider as soon as a unit becomes vacant.
• Secure all doors, windows and entry points.
• Maintain regular inspections and document property conditions.
• Keep utilities on to prevent issues like frozen pipes or mold.
• Consider installing security systems or cameras.

How Our Team Can Help

At Action Insurance Company, we guide local landlords through the process of adjusting insurance for vacant units. Contact us today to get started.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.