What might happen if a property exceeds the vacancy limit in an insurance policy?

If a property exceeds the vacancy limit specified in an insurance policy, the insurer may deny claims due to increased risk. Insurance policies typically contain provisions regarding the occupancy status of the property, recognizing that vacant properties are at heightened risk for various perils such as vandalism, theft, and deterioration. When a property remains unoccupied for a period beyond what the policy allows, it creates a situation where the likelihood of a claim occurring is statistically higher.

Insurance companies make adjustments to their risk assessments based on occupancy. Hence, if the vacancy threshold is exceeded, they may reserve the right to deny claims associated with damages that occur during that period, as these claims are considered more likely to be fraudulent or due to neglect. This reinforces the importance for property owners to be aware of their policy's terms and maintain occupancy within the stipulated limits to ensure that coverage remains in force and valid.