Have you ever wondered what happens to a home when it’s left vacant for an extended period? The silence and emptiness might seem peaceful, but in reality, it’s a magnet for potential risks. A vacant home is exposed to various threats, from vandals to natural disasters. Enter the world of “vacant home insurance Canada.” Let’s dive deep into understanding this unique home insurance and why it’s crucial for homeowners.
Understanding Vacant Home Insurance
Unlike regular home insurance that covers a lived-in property, vacant home insurance is tailored for homes without current residents. Why the distinction? Because a vacant home often faces a higher risk of damage and theft. Imagine leaving your home for a two-month vacation. If something goes wrong after the first month, your standard insurance might not cover it due to the 30-day unoccupancy rule. That’s where vacant home insurance steps in, ensuring your peace of mind.
Vacant vs. Unoccupied: Know the Difference
It’s essential to distinguish between “unoccupied” and “vacant.” An unoccupied home is temporarily empty but will be lived in again, like during a long vacation. In contrast, a vacant home is one the owner doesn’t intend to return to, such as a property up for sale. The distinction is crucial because the insurance needs for each vary.
Why Do You Need Vacant Home Insurance?
- Protection from Vandalism and Theft: A vacant property can be an open invitation for mischief-makers.
- Coverage Against Natural Disasters: From storms to earthquakes, nature is unpredictable.
- Avoiding Policy Voidance: Standard home insurance might become void if a property is vacant beyond a certain period.
Factors Affecting “Vacant Property Insurance Cost”
The cost of vacant home insurance isn’t standard. It depends on:
- Duration of vacancy
- Reason for vacancy
- Security measures in place
- Location and size of the property
Typically, expect to pay more than your standard home insurance due to the increased risks associated with vacant properties.
Tips to Protect Your Vacant Home
- Regular Checks: Have a friend or relative visit the property periodically.
- Security Systems: Install alarms and surveillance cameras.
- Maintenance: Ensure the property looks lived-in. Mow the lawn, collect mail, etc.
- Inform the Neighbors: Let them know the property is vacant so they can report any suspicious activities.
Benefits of Using a Broker for “Vacant Condo Insurance”
- Expertise: Brokers understand the intricacies of insurance policies.
- Comparison: They can compare various policies to find the best fit.
- Cost-Effective: Brokers can often find deals and discounts that might be missed otherwise.
Understanding Vacant Home Tax in Toronto
Toronto, one of Canada’s largest cities, has taken a significant step to address its housing shortage by introducing the Vacant Home Tax (VHT). This tax, part of the City’s HousingTO 2020-2030 Action Plan, aims to motivate property owners to either rent or sell their unoccupied homes.
The primary goal is to increase the housing supply, making more homes available for residents. For 2022, the tax rate is set at 1% of the property’s Current Value Assessment (CVA). However, it’s essential to note that this tax applies to homes that aren’t the owner’s principal residence and aren’t rented out for more than six months a year. Property owners are mandated to declare their property’s occupancy status annually. If they fail to do so, the property is deemed vacant and becomes subject to the VHT.
Interestingly, as reported by The Star, only 2,100 properties were declared vacant by the end of September under this new program. This number is surprisingly low, especially when the city’s estimates, based on water and hydro data, suggest there could be between 9,000 and 28,000 vacant homes. The underlying hope is that the VHT will push more homes into the rental market, potentially easing Toronto’s housing crisis.
Whether you’re travelling, selling your property, or it’s under renovation, ensuring your home is crucial. Vacant home insurance provides that extra layer of protection, giving homeowners peace of mind. Remember, it’s not just about protecting a building; it’s about safeguarding memories, investments, and a future.