Vacant property insurance: covering a building that sits empty

Two things decide whether your building is "vacant" for insurance purposes: your interest in it and how much of it is in use. The CP 00 10 09 25 building and personal property form posted by Missouri Farm Bureau applies one vacancy test to a tenant and a different one to an owner or general lessee, and it treats a building under construction or renovation as not vacant at all. A building you consider empty may or may not meet that test.[2]

The Texas Department of Insurance, writing for homeowners whose houses may sit empty during a military deployment, warns that many homeowners policies limit damage coverage after a home has been vacant for a stated period, typically 60 days. It tells owners to ask the insurer how the policy defines vacancy, whether claims are still covered, and whether the insurer offers extended-vacancy coverage. Those are the right three questions to put to any insurer looking at an empty building, even though that guidance addresses Texas homeowners policies.[1]

"Vacant" covers several different risks, and carriers separate them on the application. USLI's January 2023 vacant-building application offers property and general-liability selections for completely vacant buildings, partially vacant buildings, vacant condominium units, and vacant leased space, and asks for the vacancy date and the intended future occupancy.[4]

The same empty building can be approached in more than one way. It can be quoted on an ordinary commercial building and personal property form that carries a vacancy loss condition, as the CP 00 10 09 25 form does, or through a carrier's dedicated vacant-building category. USLI's current commercial products page places vacant and partially vacant buildings in its Property Owners category. If you are comparing a vacant building against how the same building would be written when occupied, our guide to commercial property insurance covers the underlying form.[2][3]

Related: Commercial property insurance guide

A building limit tells you almost nothing about a vacant-property policy. The vacancy condition sits between your limit and your claim, and on the CP 00 10 09 25 form it does two things at once after more than 60 consecutive vacant days: it removes several causes of loss entirely and it cuts payment on everything else.[2]

Property terms are only part of the comparison. An empty building still has a sidewalk, a roof that can shed material, and equipment that can fail. USLI's current commercial products page says its commercial products can include property damage, business interruption, and liability coverage, so ask which of those parts is actually on the quote you receive and at what limits.[3]

For a sense of the loss types carriers have written about, a USLI vacant-building guide with page codes dating from 2006 and 2011 gives examples of that product responding to vandalism, theft-related copper damage, fire, wind followed by water damage, cracked-sidewalk liability, falling-material liability, and equipment breakdown. The guide itself says the examples do not amend the policy and tells buyers to read the policy, declarations, and endorsements.[5]

Work in progress changes the analysis. Under the CP 00 10 09 25 form, a building under construction or renovation is not considered vacant, which keeps it outside the vacancy condition described above. That makes the start date, the scope, and the end date of the work facts an underwriter needs from you rather than details to sort out later.[2]

Renovation also changes how much an insurer asks. In USLI's vacant-building application, structural renovations or work costing at least $250,000 trigger added construction and premises questions. That threshold belongs to that application; another carrier can set a different line or none at all.[4]

Underwriters looking at an empty building want to know who checks on it and what still works. Two publicly posted applications show the shape of that review: USLI's vacant-building application, VBPA 1/23 as modified March 25, 2024, and the Northland supplemental application S1374-CP hosted on a Travelers application site.[4][6]

Maintenance duties that come from law are a separate question from what your policy covers. In New York, the Department of Financial Services explains that RPAPL Section 1308 can require covered mortgagees and servicers to inspect delinquent residential property, determine whether it is occupied, post notice, secure doors and windows, address attractive nuisances, winterize plumbing and heat when appropriate, maintain needed utilities, correct health and safety issues, prevent mold, and continue periodic inspections and maintenance. The same page explains exemptions and the limited conditions that trigger the duty, and construction, seasonal occupancy, probate, natural-disaster repair, and lawful occupancy can fall outside the vacant-and-abandoned definition it describes.[7]

New York City adds municipal exposure on top of that. The city's July 2021 lender and servicer guide says covered residential owners or managers must register certain buildings annually and that mortgage holders must identify, report, secure, and maintain qualifying zombie homes, and it describes violations, emergency repairs, vacate orders, and penalties that can attach when responsible parties do not maintain or secure the property. The guide states that it is informational, not legal advice, and not a complete statement of duties.[8]

Vacant buildings are quoted from the facts you supply, and small differences in how you describe occupancy or values across three submissions make the resulting numbers impossible to compare. Write the description once, then use it everywhere.

Add three questions for the insurer to every submission. The Texas Department of Insurance tells owners to ask how the policy defines vacancy, whether claims are still covered, and whether the insurer offers extended-vacancy coverage. Record each answer next to the premium; that is usually where two quotes that look alike stop being alike.[1]

Property Covered is a property insurance marketplace operated by Switchboard Risk Technologies Inc., a licensed insurance producer with access to more than 400 carriers and market options. Owners, landlords, lessors, portfolio operators, and property managers can use it, and licensed support is available by phone at (888) 693-8980 if you want help describing an unusual occupancy before the submission goes out. Carriers make the final eligibility, pricing, binding, policy, and claims decisions, and a property's class, occupancy, location, loss history, and requested coverage can limit which options exist.

Related: How Property Covered works

Once the vacancy facts above are written down, use the online quote route or call licensed support at (888) 693-8980. A quote request is free, carries no purchase obligation, and records your building facts for licensed follow-up.

Related: Start a quote request