Slow home sale or bad luck could leave you uninsured

boarded up propertiesJohn Giles/PA Archive/Press Association Images

Property is so spectacularly expensive that it's hard to imagine any homes standing empty in the UK. However, at the moment, life is changing quickly and homes are selling slowly, so there are an estimated 930,000 empty properties, according to the Empty Homes charity. In addition to those which are second homes, unoccupied for much of the year, there are plenty stuck in probate, or those which have sat on the market for well over a year, while families have had to move out in order to get on with their lives.

And while the pain of paying for an empty property is bad enough, the experts are warning that if you don't take care, there's a chance you could lose it too.

The catch

The issue lies in a little-known clause lurking in most insurance policies. It says that if your home stands empty for more than 30 days, then your insurance policy is not valid. This could mean a holiday home and its contents isn't covered at all, or an unsold property which has already become the bane of your life could suffer something devastating like a flood or a fire and you could find yourself with nothing.

The first thing that most people know about the clause is when they submit a claim and find it rejected, which can come as a horrible shock.

So what can you do?

The Financial Ombudsman regularly sees cases relating to a dispute over lack of payment when a home is unoccupied. It won't make exceptions to the rule, and in one particular case when an elderly woman was admitted to hospital and eventually kept in care for a year, she returned to a house devastated by a burst pipe, and found her claim rejected and the Ombudsman ruled in favour of the insurer.

The only grey area is that when a property is visited very regularly, even if no-one stays there overnight, it may be considered occupied. So, for example, one man renovating a property most days and sleeping elsewhere had a claim paid. However, another man who claimed to be checking up on his property had his claim rejected because the Ombudsman ruled that the property was in such a poor state of repair it doubted his story. If you remain local, you can keep your insurance valid with daily visits.

Talk to your insurer

However, if this isn't possible, the first step is to tell your insurer, who may extend the period for 60 days. Before you do this, it's worth thinking carefully about the cover they offer, because some will remove some of the cover when they do that - so you won't be covered for things like burst pipes anyway.

After that, it is a case of approaching a broker who can track down a specialist policy. These will cover an unoccupied property for up to a year - and that can be extended further if necessary.

Protect yourself

It's also worth taking steps to reduce your likelihood of making a claim. Think carefully about security - install an alarm, put lights on timers, and ensure locks are of a sufficient standard.

You also need to think about making the home seem lived in, this means keeping on top of cosmetic jobs on the outside of the property, and keeping the garden tidy. You can think about getting someone round to take the post away regularly, and ask a neighbour to park on your drive every few days.

It's also vital to protect against burst pipes, possibly by leaving the heating on very low, and ensuring the boiler remains in a good state of repair. If you are never there at all, it's worth having a plumber drain the system for you.

The 10 most unoccupied towns (percentage of properties that are unoccupied)

Burnley 7%
Hyndburn 6.99%
Pendle 6.91%
Blackburn with Darwen 5.71%
Liverpool 5.52%
Blackpool 5.46%
Bradford 5.36%
Barrow-in-Furness 5.23%
Kingston upon Hull 5.2%
Manchester 5.09%
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