Standard home insurance policies in Ontario generally void coverage if a property is left vacant for more than 30 days. As an executor, you must immediately purchase specialized vacant home insurance; otherwise, the estate will not be covered if the empty house burns down or floods.
When a homeowner passes away, their physical house often sits empty for months while the estate goes through the probate process at the Superior Court of Justice. 🏘️ Whether the home is located in a quiet subdivision in Brampton or a rural area near Sudbury, leaving an uninsured property unattended is one of the most dangerous mistakes an Estate Trustee can make. If a pipe bursts or the house is vandalized while uninsured, you, as the executor, could be held personally liable for the financial loss to the estate.
Many executors mistakenly assume that the deceased person’s regular home insurance policy simply continues until the house is sold. ❌ This is completely false. Almost all standard insurance policies in Ontario contain a strict “vacancy clause” that nullifies coverage after 30 days of the property being unoccupied. Taking immediate action to secure vacant property insurance and working with an estate lawyer to manage the asset is absolutely critical.
Step-by-Step Process for Securing an Estate Property
Protecting the real estate asset is your immediate fiduciary duty. 📝 You must act quickly, often before the funeral has even taken place.
Step 1: Contact the Current Insurance Broker
Your very first call should be to the deceased person’s current home insurance provider. 📞 Inform them of the death and let them know the property is now vacant. Do not lie or try to pretend someone is living there to save money; insurance fraud will result in a completely denied claim. The current provider may offer a vacancy permit for a short period.
Step 2: Purchase Vacant Home Insurance
If the current insurer will not extend coverage (which is common), you must purchase a specialized Vacant Property Insurance policy. 📄 These policies are designed specifically for empty homes. They are significantly more expensive than standard policies and provide narrower coverage (for example, they may exclude water damage unless the pipes are drained).
Step 3: Winterize and Secure the Home
To comply with the new insurance policy, you will likely need to hire professionals to secure the home. ❄️ In Ontario, this usually means hiring a plumber to shut off the main water supply and drain all the pipes to prevent freezing and bursting during winter. You should also ensure all doors and windows are locked, and consider setting up automated lights to deter break-ins.
Step 4: Conduct Mandatory Routine Inspections
Vacant property policies come with very strict conditions. 🔍 Most require a competent adult to physically enter and inspect the home every 48 to 72 hours. You must keep a written log of every visit, noting the date, time, and that the heating and plumbing were checked. If you fail to maintain this log, a future claim could be denied.
Standard vs. Vacant Property Insurance
| Feature | Standard Home Insurance | Vacant Property Insurance |
|---|---|---|
| Vacancy Limit | Usually voids after 30 days of being empty. | Specifically designed for long-term empty homes. |
| Inspection Rules | No strict routine visit requirements. | Requires documented physical checks every 48-72 hours. |
| Water Damage | Generally covered. | Often excluded unless water is shut off and pipes are completely drained. |
How Much Does it Cost in Ontario?
Insuring and maintaining an empty house is a significant drain on estate funds, but it is a necessary expense that you pay from the estate accounts. 💵
- Vacant Insurance Premiums: Because empty homes are high-risk, premiums are expensive. Expect to pay between $150 and $400 CAD per month. These policies are often sold in 3-month or 6-month blocks.
- Winterization Services: Having a licensed plumber professionally drain the system and add antifreeze to traps usually costs $200 to $500 CAD.
- Property Management: If you live far away, you may need to hire a property management company to conduct the required 72-hour checks, which can cost $300 to $600 CAD per month.
How Long Does the Process Take?
The transition to vacant insurance must happen immediately. ⌛ You have a maximum of 30 days from the date the home becomes empty to secure new coverage, but it is best to handle it in the first week.
You will need to maintain this expensive insurance for the entire duration of the probate and sales process. Getting a Certificate of Appointment of Estate Trustee (probate) in Ontario can take 4 to 10 months. Selling the house and closing the deal takes another 2 to 3 months. Therefore, you should budget for at least 6 to 12 months of vacant insurance premiums.
Frequently Asked Questions (FAQ)
What if the estate has no cash to pay the insurance premium?
If the bank accounts are frozen and the estate has no liquid cash, the executor usually pays the insurance premium out of pocket and reimburses themselves first once the house is sold or the accounts are unfrozen. Do not let the property go uninsured.
Can a family member just move in to avoid the vacant status?
Yes, having someone live there technically means it is not vacant. However, this creates a massive risk: if they refuse to leave when it is time to sell the house, you will have to undergo a lengthy legal eviction process under the Residential Tenancies Act.
Does leaving furniture in the house mean it is not vacant?
No. Insurance companies define ‘unoccupied’ or ‘vacant’ based on whether a human being is actively living and sleeping there on a daily basis. Leaving couches and beds in the house does not trick the insurance company.
What happens if the pipes burst without vacant insurance?
The insurance company will deny the claim, and the estate will have to pay tens of thousands of dollars for repairs. If the beneficiaries discover that you failed to secure vacant insurance, they can sue you personally for breach of fiduciary duty to recover the lost value.
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