Owning a holiday home can be the result of years of planning and saving. Whether it is a coastal retreat, a countryside cottage or a second home that you return to throughout the year, the property is likely to represent a significant financial investment.
Protecting it properly is therefore important.
Although holiday home insurance has similarities with conventional home insurance, the risks can be quite different. Holiday properties may remain empty for extended periods, be located some distance from your main residence or be rented to paying guests.
For these reasons, an ordinary home insurance policy may not provide the protection you need.
Specialist holiday home insurance can be designed around the way your second property is actually used, helping to protect the building, its contents and, where appropriate, your rental income and liability as the property owner.
What Is Holiday Home Insurance?
Holiday home insurance is designed for properties that are not occupied as the owner’s main permanent residence.
This could include:
- Coastal Holiday Homes
- Countryside Cottages
- Second Homes
- Holiday Cottages
- Properties Used by Family and Friends
- Properties Occasionally Let to Paying Guests
- Holiday Properties Used Seasonally
The precise definition varies between insurers, so it is important to explain exactly how you use the property when arranging cover.
A property occupied exclusively by you and your family may require different insurance from one that is regularly advertised and rented to holidaymakers.
What Is the Difference Between Home Insurance and Holiday Home Insurance?
The biggest difference is usually how frequently the property is occupied.
Your main residence will generally be lived in throughout most of the year. If a pipe starts leaking, a window is damaged or somebody attempts to break in, there is a good chance the problem will be discovered relatively quickly.
A holiday property can sometimes remain empty for several weeks or months.
If a water leak occurs shortly after you leave, for example, it could continue unnoticed for a considerable period and cause extensive damage.
Longer periods of unoccupancy can also increase the risks associated with:
- Theft
- Vandalism
- Escape of Water
- Storm Damage
- Undetected Maintenance Problems
- Burst Pipes During Cold Weather
Because of these additional risks, insurers may apply different conditions to holiday properties.
Some policies specify how long the property can remain continuously unoccupied before additional conditions or restrictions apply.
There is no universal 30-day rule that applies to every policy, so always check your own insurance documents carefully.
Can You Use Standard Home Insurance for a Holiday Home?
Standard home insurance is generally designed around a property being used as your main residence.
If your property is a second home, remains empty for prolonged periods or is rented to paying guests, conventional home insurance may not provide suitable protection.
It is important to tell your insurer exactly how the property is used.
Failing to disclose that a property is regularly unoccupied or let to holidaymakers could potentially affect your cover or a future claim.
Specialist holiday home insurance can take these circumstances into account from the outset.
What Does Holiday Home Insurance Cover?
Holiday home insurance can combine several types of protection.
The exact cover varies between insurers, but you may want to consider the following.
Buildings Insurance
Buildings insurance protects the physical structure of your holiday home against insured risks.
Depending on the policy, this could include damage caused by events such as:
- Fire
- Flooding
- Storms
- Escape of Water
- Subsidence
- Theft or Attempted Theft
- Vandalism
- Certain Types of Accidental Damage
Buildings cover can include more than the walls and roof.
Permanent fixtures and fittings such as fitted kitchens, bathrooms and other structural features may also form part of the insured building, depending on the policy.
It is important to insure the property for an appropriate rebuilding value rather than simply using its market price.
The cost of rebuilding a property can be very different from the amount you would receive if you sold it.
Contents Insurance
Holiday homes often contain thousands of pounds worth of furniture, appliances and other belongings.
Contents insurance can help protect items belonging to you that are kept inside the property.
These might include:
- Furniture
- Televisions
- Kitchen Appliances
- Curtains and Soft Furnishings
- Beds and Bedding
- Electrical Equipment
- Household Items
- Certain Personal Possessions
If you let the property to guests, check whether accidental or malicious damage caused by occupants is covered.
High-value individual items may also need to be specifically declared to the insurer.
Public Liability Insurance
If guests, visitors or other members of the public use your holiday property, liability protection becomes an important consideration.
Public liability insurance can provide protection if somebody suffers an injury or damage to their property and you are found legally liable.
For example, a guest could suffer an injury because of a defect at the property and subsequently make a claim against you.
Liability claims can involve both compensation and legal expenses, so property owners who let holiday accommodation should make sure they have an appropriate level of protection.
Do not assume that liability insurance is automatically included in every holiday home policy. Check the level and extent of cover provided.
Loss of Rental Income
If you let your holiday home commercially, rental income may form an important part of your finances.
Imagine the property suffers serious damage from an insured fire or flood and cannot accept bookings while repairs are completed.
As well as paying for repairs, you could lose income from bookings that have to be cancelled.
Loss of rental income cover may compensate you for certain lost income following an insured event, subject to the limits and indemnity period specified by your policy.
This can be particularly valuable for owners who operate their property as a holiday let throughout the year.
Alternative Accommodation
Some holiday home policies may provide cover for alternative accommodation following serious insured damage.
For example, if guests are staying at the property when it becomes uninhabitable, the policy may provide assistance with certain additional accommodation costs.
The circumstances and limits vary considerably between policies, so check whether this protection is included if it is important to you.
Home Emergency Cover
Home emergency insurance can provide assistance following certain unexpected problems that require urgent attention.
Depending on the policy, this might include emergencies involving:
- Burst Pipes
- Plumbing
- Heating
- Electrical Systems
- Locks and Security
- Broken Windows
This can be especially useful if your holiday home is a considerable distance from your main residence and you are unable to deal with an emergency personally.
Home emergency cover is often an optional addition rather than a standard feature.
Legal Expenses Insurance
Disputes involving property can become expensive.
Legal expenses insurance may provide financial assistance with certain legal costs arising from insured disputes.
The types of disputes covered vary according to the policy, so check the terms carefully rather than assuming that every disagreement involving guests, neighbours or contractors will be covered.
What If You Rent Your Holiday Home to Guests?
Letting your holiday property can help offset ownership and maintenance costs, but it also changes the insurance risk.
You should always tell your insurer if the property will be rented to paying guests.
The insurer may want to know:
- How Often the Property Is Let
- How Guests Book
- Maximum Number of Guests
- Whether You Use Booking Platforms
- Whether You Employ a Managing Agent
- Whether the Property Is Let Throughout the Year
- What Security Measures Are Installed
- Whether Cleaning or Maintenance Staff Attend the Property
Insurance arranged solely for private family use may not provide appropriate protection once a property starts being operated as a commercial holiday let.
What Happens When Your Holiday Home Is Empty?
Unoccupancy is one of the most important aspects of holiday home insurance.
Different insurers impose different conditions once a property has been empty beyond a particular period.
Your policy might require you to:
- Inspect the Property at Regular Intervals
- Keep Heating at a Minimum Temperature
- Turn Off or Drain the Water Supply
- Maintain Appropriate Security
- Keep Doors and Windows Locked
- Remove Post and Other Signs of Unoccupancy
- Inform the Insurer of Extended Vacancies
Make sure you understand these requirements.
If you fail to comply with an unoccupancy condition, it could affect the cover available if something happens while the property is empty.
How Should You Value Your Holiday Home?
Accurate valuations are important when arranging insurance.
For buildings insurance, you normally need to consider the cost of rebuilding the property rather than its market value.
Reinstatement costs can include:
- Building Materials
- Labour
- Demolition
- Site Clearance
- Professional Fees
- Compliance With Current Building Regulations
For contents insurance, calculate approximately how much it would cost to replace the belongings you keep at the property.
Work through the property room by room rather than estimating from memory. Furniture, electrical appliances, kitchen equipment and furnishings can quickly add up.
Underestimating the value of your property or contents could leave you underinsured.
Keep Records of Your Contents
Keeping evidence of valuable possessions can make the claims process easier.
Useful records can include:
- Receipts
- Photographs
- Serial Numbers
- Purchase Confirmations
- Valuations for Higher-value Items
Digital copies can be particularly useful because they can be stored somewhere other than the holiday property itself.
If an item is lost, stolen or badly damaged, these records can help demonstrate what you owned and its approximate value.
Think About Security
Good security can help protect both the property and your insurance position.
Depending on your location and insurer, you may want to consider:
- Suitable Door and Window Locks
- Alarm Systems
- Security Lighting
- CCTV
- Smart Doorbells
- Water Leak Detectors
- Remote Heating Monitoring
- Key Safes Designed for Holiday Accommodation
Some insurers may specify minimum security requirements, particularly for properties containing valuable contents or those that are regularly left empty.
Check before making assumptions about what is acceptable.
What Affects the Cost of Holiday Home Insurance?
The cost of holiday home insurance will depend on several factors.
Insurers may consider:
- Property Location
- Rebuilding Value
- Value of Contents
- Property Age
- Construction Type
- Flood Risk
- Subsidence Risk
- Security
- Claims History
- Length of Unoccupied Periods
- Whether the Property Is Let
- Number of Guests
- Additional Cover Required
A property that is occupied regularly by the owner may present a different risk from one that remains empty throughout much of the winter and is rented to guests during the summer.
Providing accurate information helps your insurer offer cover based on the true nature of the risk.
Use a Broker Who Understands Holiday Homes
Holiday properties do not always fit neatly into conventional home insurance policies.
Working with an insurance broker can therefore be particularly useful.
A broker can discuss how you use the property, identify potential areas of risk and help you compare insurance options suitable for your circumstances.
This can be especially valuable if your holiday property:
- Is Regularly Let to Guests
- Remains Empty for Long Periods
- Is in a Coastal or Rural Location
- Has Unusual Construction
- Is a Listed Building
- Contains High-value Contents
- Has Previously Suffered Flooding or Subsidence
The cheapest policy is not necessarily the best policy if important risks are excluded.
Read Your Policy Conditions Carefully
Holiday home insurance can include conditions that do not apply to an ordinary main residence.
Make sure you understand:
- Unoccupancy Limits
- Security Requirements
- Inspection Requirements
- Excesses
- Buildings Sum Insured
- Contents Limits
- Single-item Limits
- Liability Cover
- Rental Income Cover
- Main Exclusions
If anything is unclear, speak to your insurer or broker.
It is much better to understand a restriction before you need to make a claim.
Tell Your Insurer When Something Changes
Insurance should reflect how the property is currently being used.
Contact your insurer or broker if there are significant changes, such as:
- Starting to Let the Property
- Stopping Holiday Lets
- Major Renovations
- Extended Unoccupancy
- A Change in Property Use
- Installing or Removing Security Systems
- Increasing the Number of Guests
- Adding Valuable Contents
Do not simply wait until renewal if the change could materially affect your insurance.
Review Your Holiday Home Insurance Every Year
Your holiday property and its contents can change over time.
Building costs can rise, furniture can be replaced, improvements can increase rebuilding costs and the way you use the property may change.
Review your insurance before each renewal and check that the sums insured and types of cover remain appropriate.
It is also a good opportunity to review your premium and compare the protection being offered.
Protecting Your Holiday Home
A holiday home can be both a valuable financial asset and somewhere associated with years of family memories.
Specialist insurance helps reflect the additional risks that arise when a property is not your permanent residence.
From buildings and contents protection to liability, rental income and periods of unoccupancy, choosing appropriate cover can help protect you against the financial consequences of unexpected events.
At West Craven Insurance, we can help you assess how your holiday property is used and identify insurance suitable for your individual circumstances.
Whether your holiday home is exclusively for you and your family or is also rented to paying guests, speak to West Craven Insurance about arranging suitable holiday home insurance.
Looking for Holiday Home Insurance?
Get in touch with West Craven Insurance to discuss your property, the cover you require and the holiday home insurance options available to you.
