In this article we’ll explore some of the key things you’ll need to know if you own a bach or are looking at purchasing one, or even if you’re someone who doesn’t own a bach but is planning to rent one out. It’s important to note that some of the details will vary between insurers, so it’s essential you talk to your broker to get the details correct and ensure you’re properly insured.
Cover expiring due to un-occupancy
For most insurers your cover will cease if your bach isn’t occupied or used for a period of 90 days. This is the default for most insurers, unless you’re taking reasonable steps to care for the holiday house, which includes:
- The house is inspected inside and outside by you or a nominated person at least every 90 days.
- The house and its grounds are adequately maintained. Keeping the lawns mowed and the place tidy to a reasonable standard is not only a good way to protect your house from fires, but it also decreases the chances of being burgled.
- Your letterbox is cleared regularly. Nothing screams empty, unattended house to burglars more than a stuffed letterbox.
- The water supply is turned off.
- The doors are locked and windows secured.
When it comes to protecting your asset, having an alarm can be a great way to keep your insurer happy, and may even get you a discount on your contents insurance.
Casual or short term letting
If you rent out your bach or even your own home on a casual or short-term basis, whether that’s through Airbnb or any other means, it means your asset is classified as business use, which requires a different kind of insurance.
Some insurers will give approval for these kinds of arrangements without you needing to take out a whole new policy, but the important thing is that they know. If you rent out your house or bach without your insurer knowing you risk your cover being cancelled.
It’s also important to know that intentional damage or theft caused by your guests won’t be covered under your policy. So it pays to know who you’re renting out your asset to.
Renovations
From time-to-time you’ll also need to do some renovations to your holiday house. Maybe it needs a new roof or you want to add another bedroom. If the work is classified as a major renovation, you’ll need to talk to your broker to ensure the home is still covered during the construction process. The threshold for what classifies as a major renovation may also vary between insurers, so a conversation with your broker is the best way to keep your cover.
Boats and jet skis
Having a holiday house is great, but the Kiwi dream often includes a boat or a jet ski. Now you’re really on holiday! But even if your boat or jet ski is stored in the garage or shed on the property, you’ll need to have a separate policy to ensure those assets are covered as well.
In a nutshell, if you own a holiday home that you’d like to protect the key to ensuring you’re adequately covered is talking to your broker to prevent the kiwi dream from becoming a nightmare.
