It is super important that you categorize the type of home properly. On every insurance application you are asked if the property is either used primary, secondary, or seasonal.
The risks differ greatly between each residence types, and if not categorized correctly, your insurer may cancel your policy or deny a claim.
A primary home can be any type of residence from a condo, apartment, or single-family home as long as it meets the following requirements:
• The residence is lived in for most of the year.
• The residence is a manageable distance from your primary place of employment.
• You have documentation that proves it is your residence.
Seems pretty straightforward right? Let’s move onto the next property classification, secondary and seasonal homes.
If you are struggling to get classify a secondary or seasonal property, you can put this in the “good problem to have” category.
Secondary homes are a bit more confusing because it is easily mistaken for a seasonal home. However, there are some key differences that will help homeowners like yourself to clearly separate the two.
A secondary home is a residence that you live in for only part of the year. There are additional requirements to be considered a secondary home as well. For example; it must be exclusively under your (the policyholder) control and the residence must be assessable by car throughout the year from your primary residence.
Seasonal homes are rented out, involved in time share services, or interact with our non-owner residents in other ways.
However, with a seasonal home, the residence is only occupied for a small part of the year and is located farther away from the primary home.
Seasonal home insurance is usually more expensive than primary and secondary insurance because the residence is left unattended for an extended period of time which poses new risks.
For example: the home is more suspect to theft. Or, if a fire were to start, no one would be there to prevent it or take measures like alert the fire department.
For reasons like this, the seasonal home is insured under a separate policy than your primary residence, but your premium will be based on the same factors as your primary like replacement cost, deductible and the risks that are present in the area.
Remember, if you misclassify your home as primary when it is secondary or seasonal, and you have to make a claim for a loss, you might have difficulties with your insurer.
If your insurance company believes you misrepresented your property, they could only provide you partial coverage for the loss or even worse, deny the claim all together. Although secondary and seasonal homes are quite a bit more expensive to insure then primary, make sure you are properly classifying so you are fully covered for any loss.