Unique insurance considerations

secondary homes

There are about 7.15 million second homes in the U.S.1 Did you know that secondary homes have unique risks that a primary home does not? While a second home provides a refreshing change of pace from your everyday life, one thing that doesn’t change is the need for insurance. Whether you use it year-round, all summer or only on weekends, you want a second home to be as well protected and cared for as your main residence. Understanding how your insurance coverage will protect your home when you’re not there is important.

What to know about insurance for your second home

Long periods with no occupants

Most second homes are used as vacation homes or used only on occasion. Because the house might sit empty for long periods of time, the risk of damage from fire, plumbing problems or burglaries greatly increases. If you’re not around when a fire starts or a pipe bursts, imagine how far the damage can spread. You may not realize anything is wrong until hours, days or weeks later. A professional caretaker can help keep an eye on your property, tend to the grounds, accept deliveries, and maintain vehicles and amenities such as pools or spas when you aren’t there. This can help deter burglars and reduce damage due to delayed maintenance or wear and tear. Central fire and burglar alarms, as well as water loss mitigation devices, can help prevent property damage and may lower your insurance premium.

Location: Rural isolation or coastal hideaway

Even if you are in your second home when an incident occurs, you might be too secluded to get timely help. Where are the nearest fire hydrants, emergency supply stores, and police and fire departments? Do you have watercraft, ATVs, snowmobiles or a golf cart that you keep at your second home? The location of your home may also come with additional risk exposures such as earthquake or flood.

How you may be at risk

Let’s review the following scenarios and consider potential risks and associated costs:

  • The sprinkler system in your custom vacation home engaged, triggering water to spray in the family room and run through most of the first and second floors, causing significant water damage. The total damages are in excess of $1.6 million. If this would happen, are you covered for the necessary repairs and a place to stay?2
  • Snow accumulated on your exterior patio on the second level. Snowmelt caused the water to seep into the home, traveling through the ceiling and pooling on the hardwood flooring. Two full rooms have to be opened to the studs due to water damage. The flooring needs to be replaced throughout the main level. The water sat in your home for two weeks before you visited the property, causing $75,000 in damages. Are you covered?

A second home is a wonderful luxury. As with any property, it’s important that your investment is properly protected with the right insurance. Contact your agent to ensure that you have proper insurance to cover all of your possessions while they are in use or stored at your second home.

How Nationwide® Private Client responds

Nationwide® Private Client provides robust coverage, including dwelling, personal property and liability through a separate homeowners policy. However, if you don’t need coverage for your dwelling structure, you can endorse your primary homeowners policy to extend liability to a secondary home or increase the coverage limit for your personal property at the additional residence. Private Client can provide your second home with the following protection:

  • Unlimited replacement cost coverage3
  • Loss of use2
  • Up to 100% of dwelling value for building ordinance and law upgrades
  • Personal property special limits of liability
  • Watercraft liability and physical damage available through a separate endorsement
  • Sewer backup included at full dwelling value
  • Coverage for your LLC or family trust by endorsement or automatically with our Protection Endorsement
  • Personal excess liability coverage
  • Protection endorsement, which includes the following coverages: deductible waiver, water shut-off device following first covered water damage claim, real estate tax assessment, disability alterations, and earth movement and earthquake for personal property (for states other than California)
[1] “The Nation's Stock of Second Homes,” Na Zhao, eyeonhousing.org/2022/05/the-nations-stock-of-second-homes (May 13, 2022).
[2] Loss of use and additional living expenses for secondary homes apply for the customary time that the home is used.
[3] The availability of the unlimited replacement cost coverage varies by state.

Each claim is handled on the basis of its individual facts and circumstances and in accordance with policy language, including applicable exclusions, conditions and limitations. This insurance overview is for informational purposes only and does not replace or modify the definitions and information contained in individual insurance policies, their endorsements or declarations pages, which are controlling. Terms and availability vary by state, and exclusions apply. Private Client products are underwritten by Crestbrook Insurance Company, an affiliate of Nationwide Mutual Insurance Company, Columbus, Ohio. Nationwide, the Nationwide N and Eagle and Nationwide Private Client are service marks of Nationwide Mutual Insurance Company.
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