If you have bought a holiday home, don’t try to get away with slapping on a standard home insurance policy or you may get badly burnt.
You need to consider specialist property insurance to cover holiday homes, rather than ordinary buildings and contents insurance.
In this article, we explain:
- Why might you need holiday home insurance?
- What’s the difference between holiday home insurance and standard home insurance?
- Can I get a standard home insurance policy to cover my holiday home?
- Holiday home-insurance providers
Find out more in our guide to buying a second home.
Why might you need holiday home insurance?
There are two main reasons why you might need holiday home insurance:
1. The property will sometimes be vacant
Specialist holiday home cover is often needed where a property will be vacant, as this will make it more vulnerable to burglary and weather-related damage.
For example, a leak that might get spotted after a few hours in your main home could become an acute and expensive problem if only discovered after a few weeks.
In other words, don’t skimp on cover just because you will spend less time in your home-away-from-home than you do in your main residence.
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2. To rent out to holidaymakers
The other is if you let the property out to other holidaymakers.
You will need cover for the added risks of injury or damage to the property or the contents.
What is the difference between holiday home and standard home insurance?
The two elements of any home insurance policy are to cover you for the:
- Building: this protects you financially from structural damage to your property caused by events such fire, flooding, storms or subsidence.
- Contents: will allow you to repair or replace possessions and furniture if they are damaged, destroyed or stolen.
But the big difference between holiday home insurance and standard home insurance is covering your bolthole if it’s empty for long periods.
Standard home policies usually state that if you’re absent for longer than a set time – such as 30 days in a row – then you won’t benefit from full cover for disasters.
To an insurer, an unoccupied home is a bigger risk than a home with people living in it.
Empty properties are more likely to be targeted by burglars, squatters or vandals, and they are also more likely to be damaged by the elements or other problems. If you’re not around to notice that water leak, slipped tile or electrical fault, the damage can intensify.
There is also the heightened risk of your home contents being stolen or damaged, either accidentally or maliciously, should you have guests in the property.
Specialist holiday home insurance covers against these eventualities. Just watch out for the small print.
For example:
- Some policies might insist that the water system is drained or turned off while your holiday home is unoccupied.
- Others policies suggest that the heating stays on at a set temperature in winter.
- You might also be required to inspect the property at regular intervals or arrange for someone else to do so.
Can I get a standard home insurance policy to cover my holiday home?
A standard home insurance policy will usually only cover your main residence. You will usually need to take out a separate policy specifically to cover your holiday home.
This is because there tend to be more risks with holiday homes, for example, it is likely to be empty for long periods. Holiday home insurance can cover you during those periods, even if is empty for longer than 30-60 days.
There are also other risks associated with letting guests stay – even family and friends – like accidental damage.
Important: If you don’t tell your insurer that the policy is for a second home, it could refuse to pay any claims and cancel your cover.
To an insurer, an unoccupied home is a bigger risk than a home with people living in it
Do I need holiday home insurance?
Legally, you don’t have to take out insurance on a holiday home.
However, if you have a mortgage on the property, the lender will normally insist that you fork out for buildings cover.
Even if you don’t have a mortgage, this insurance may still be worthwhile in case an unexpected disaster reduces your valuable asset to a pile of rubble.
Homeowners should also consider enhanced contents insurance if they let other people stay in the holiday property (see below).
Find out more: Five steps to renting out your holiday home
What types of property can be covered by holiday home insurance?
Holiday homes come in all shapes and sizes, and you can find holiday home insurance to fit.
A wide variety of properties can be covered, such as:
- Houses
- Apartments
- Villas
- Chalets
- Static caravans.
If your country pile or rose-covered cottage is a listed building, consider searching for a specialist policy that will cope with the additional hassle of repairs or rebuild costs.
If your holiday home is abroad, consider an insurer whose policies stretch overseas. The risks may be different for other countries, due to less frequent visits or the increased likelihood of extreme events such as earthquakes or hurricanes.
Using a UK company for overseas holiday home insurance has the advantage that paperwork and claims handling should be in English.
Holiday home insurance providers
Major providers of holiday home insurance include:
- Aviva
- AXA
- Direct Line
A specialist insurer may be able to find the best holiday home insurance to fit your specific property, rather than offering a “ready made” policy.
Some specialist property insurers include:
- Andrew Copeland
- Intasure
- Vasek
How to get cheaper holiday home insurance
Insuring a holiday home is typically a bit more expensive than insuring your main home, but you can cut costs in many of the same ways:
- Compare quotes from different insurers.
- Pay a year’s premium at the start, rather than making monthly payments.
- Consider combining buildings and contents cover in the same policy, rather than using two different insurers
- Bump up the “excess” – the first part of any claim that you have to pay.
- Check if you can get a discount for upgrading security, such as installing a burglar alarm.
- Avoid claiming unless it’s essential, to maintain your no-claims bonus.
If you have multiple holiday lets, see if an insurer will give you a lower average price for the portfolio.
However, don’t be tempted to bend the truth to get cheap holiday home insurance – for example, by putting a lower value on your contents than they are really worth, or on the costs for rebuilding the property.
Otherwise, if you come to claim, the insurer could reduce the payout or even cancel your policy.
Find out more: I want to buy a place where I go on holiday. What are the tax implications?
What insurance do I need for a holiday let?
If you rent out your holiday home to paying guests, they may not be as careful with it as you would be.
There is also the risk that guests and staff, such as cleaners or gardeners, could be injured.
Is your property packed with desirable features such as woodburners, open fires, hot tubs, saunas and swimming pools? If so, you might want cover for the equipment as well as any accidents and injuries when using it.
When searching for holiday let insurance, consider cover for:
- Accidental damage to contents
- Malicious damage and theft by guests
- Public liability insurance, to pay legal expenses if someone gets injured while staying there
- Employers’ liability insurance, to cover any employees working there, such as cleaners or gardeners
- Cover for loss of rent, and alternative accommodation for holidaymakers, if the property is uninhabitable due to a disaster such as fire or flood
- Legal expenses cover, – for legal fees if you end up in a dispute with any tenants
How long can I leave my holiday home unoccupied?
It depends. Check the small print of specific policies, but consider looking for holiday home cover where you can leave it unoccupied for more than 30 days.
What won’t holiday home insurance cover?
Holiday home insurance won’t cover your personal valuables, so don’t leave treasured items such as jewellery lying about.
Nor will it cover your guests’ belongings – they will need their own insurance.
Does Airbnb cover insurance and what add-ons do I need?
The Airbnb Host Guarantee provides some protection for property damage, but it isn’t an insurance policy and doesn’t cover all damage by guests.
Airbnb Host Protection Insurance protects hosts against claims made by guests in the holiday home if they are hurt or their property is damaged.
However, you will need your own buildings and contents cover for issues that aren’t related to bookings. You should always tell your insurer if you use Airbnb.
Important information
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