Standard homeowner and commercial policies do not cover empty buildings after approximately 30 days. Vacant properties face increased risks: vandalism and property damage, fire and explosion, water damage, and liability issues. 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.
Financial coverage to repair or replace your building if damaged by fire or explosion
Covers property damage from weather events up to your coverage limits
Financial protection from legal claims and medical bills if someone is injured on the vacant property
Backed-up sewage is not covered under a standard policy; can be added as an endorsement
Overland water damage and frozen pipe damage are generally not covered by a standard policy; available as an add-on (frozen pipe exclusion assumes amenities should be turned off or regular maintenance maintained)
Available if the property is in an earthquake zone; not all insurers offer it
Protects against damage from leaking built-in sprinklers
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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 various risks.
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.
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 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?
Does vacant property insurance cover both homes and business spaces?
Yes, it covers residential homes, estates, rental units, and commercial properties that are empty for extended periods.
Do I need it for a property being sold or undergoing renovations?
Yes, even temporary vacancies require coverage.
Can I cancel once the property is occupied again?
Yes, you can adjust or cancel your coverage when tenants move in, new owners take possession, or a commercial space reopens.
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?
No, vacant land insurance covers liability on undeveloped land; vacant property insurance covers empty residential and commercial spaces.
How long can I leave my property unoccupied before I need insurance?
Standard homeowner and commercial policies typically stop covering empty buildings after approximately 30 days. After that point, the insurer can void the policy and deny claims, so you need a vacant property policy or endorsement in place.
What is the difference between an unoccupied and a vacant property?
An unoccupied property is one that is expected to be occupied soon. A vacant property is fully empty with utilities disconnected.
