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Understanding off-grid homeowners insurance

Understanding Off-Grid Home Insurance

One of the biggest trends these days are homeowners going “off-grid”. This means residents are choosing to save their money through living without the usual overhead expenses of having energy running 24/7. While you may be allowing a unique experience or simply making sure that you are not contributing to harming the environment, you may also have difficulty in finding home insurance coverage. For homeowners who are considering this way of living, it is crucial to know what to do about your home insurance.

What Is Living Off-Grid?

Off-grid living is a system of lifestyle wherein the residents live in an area that is not yet reached by modern infrastructure, for example, an electrical grid or similar services. Most of the time, living off-grid means being able to achieve autonomy by producing your own power or other daily necessities.

In most cases, especially for residents with families, living off-grid is a seasonal activity. This means there is an additional home or property, most likely in a remote area, where they get to experience living off-grid.

There are also cases, when homeowners living in regular homes are turning off their public energy connection by choosing to get their energy from an independent source, such as installing solar panels.

Off-Grid Insurance Explained

Many insurance companies, however, while they understand the value of reducing carbon footprint, do not support this type of coverage. Living off-grid increases your risk of being in involved in an unwanted event. For example, if you will not be using gas or electricity for cooking – you may pose a greater threat for fires.

In addition, finding insurance for recreational or seasonal homes is typically more expensive because they are not occupied year round. This makes these properties more prone to different problems, like theft or vandalism.

For some companies who allow this type of add-on, you can include your seasonal home to your typical home insurance for your primary home. Still, there are restrictions on these policies so make sure to talk your agent extensively before you complete your purchase. Since there is an increased risk, most insurers  will require you to pay an additional premium for issues like vandalism, burglary, and theft.

Reducing Your Premium Add-Ons

Still, there are different ways to reduce the cost of your premium even if you include these off-grid properties.

  • Rent Out Your Property – You can rent out your seasonal property during other times of the year that you are not there. Rented properties are usually handled differently than a seasonal home, which is only used for family activities.
  • Improve Security – If security is an issue, you can lessen the cost of your insurance coverage by pointing out that they are neighbors nearby. If your remote property is also nearby a fire hall, this may help lower the cost of insurance. Still, for properties that cannot be reached by a firetruck or the fire department, it may be hard to buy insurance.
  • Multiple OwnersLiability may also be considered if the seasonal property has multiple owners. Most likely because the property will be used more times compared to the house being left alone for single owners.  
  • Additional Liability – There may be additional liability necessary for homes that are located in a waterfront area. You may also consider other coverage such as boats, watercrafts, or all-terrain vehicles.

Living Off-Grid In Your Primary Home

Many families are opting to lessen their environmental footprint by “living off-grid” even when they are located in the heart of the city. For some homeowners, for example, they opt to use solar energy rather than rely on the public electricity grid.

There are a number of insurance companies which will give green homes discounts on their home insurance policy premium. The most approved green energy system is solar energy for electricity and geothermal pumps to heat the homes. You will need to use the services of an approved and qualified contractor to get coverage.

One thing you need to consider is, not all insurance companies will approve these alternative sources of energy. Some companies will offer a discount for green homes, but will not sell specific insurance coverage for these homes.

Thankfully, as more and more families are moving towards green living, by using alternative energy, composting, or using public transport – they are ultimately helping the environment. Some insurance companies are also recognizing the importance of this type of lifestyle.

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