Incidents involving vacant homes are on the rise in Terre Haute, Indiana, especially amid frigid winter weather, as empty homes in the city are increasingly being used for shelter, drugs or theft, WTWO News reported recently. The trend is mirrored in other parts of North America. For example, an uptick in fires at vacant properties in Albany, New York, is being linked to squatters, according to reports, and authorities in Springfield, Illinois, are working to stop vacant structure fires as freezing temperatures set in.
One vacant commercial property in Renton, Washington, has become a “hotspot for illegal activity,” neighbors told news outlet KING-TV, with police saying that the former office space and parking garage has been linked to at least 20 service calls in the past year for fires, noise complaints and suspicious activity.
“Squatters in vacant properties have been an absolutely terrible problem,” said Ryan Short, Senior Underwriter, Commercial Insurance, Burns & Wilcox, Atlanta, Georgia. “We had one property where there was no heat. A fire was lit, which jumped to a neighboring house. Now the owner is looking at just millions upon millions of dollars in property damage and bodily injury claims.”
The majority of the time, owners have great intentions with these properties, but they do not always follow through. The concern for insurance is whether the owner is really taking care of this property or not.
The situation is “a nightmare” for vacant property owners, who may not notice suspicious activity in the home until after significant damage is done, he said. This has caused skyrocketing rates for Commercial Property Insurance and Homeowners Insurance on vacant structures, Short said. If a property has been vacant for too long, coverage may not even be available, said Paul Van Overbeke, Underwriter, Personal Insurance, Burns & Wilcox, Minneapolis, Minnesota.
“It can be tough to explain to owners why the coverage is more expensive, but the news headlines illustrate the risks,” Van Overbeke said. “The majority of the time, owners have great intentions with these properties, but they do not always follow through. The concern for insurance is whether the owner is really taking care of this property or not.”
The perils of vacant properties
Fire is one of many risks commonly associated with vacant buildings. According to the U.S. Fire Administration, the leading causes of vacant residential building fires include intentional actions, open flames and electrical malfunctions. In Winnipeg, Manitoba, at least six vacant properties that have previously burned have caught fire again so far in 2025, officials told CBC News in a Jan. 12 report. The city experienced about 20 vacant building fires per month in 2024, a 20-time increase over the past decade, and the trend appears to be worsening, the report noted.
Similar to what was seen during the pandemic, economic challenges could be contributing to a rise in vacant buildings, Short said. “With the economy, we are starting to see more foreclosures and businesses shutting down. When individuals are forced out of their living conditions, they may turn to these vacant properties,” he said.
In Canada, more mortgages have gone into possession in recent months amid economic challenges, said Atef Shah, Associate Manager, Commercial & Personal Insurance, Burns & Wilcox, Toronto, Ontario. “A lot of Canadians have overleveraged themselves, and the mortgagee has repossessed the home,” he said, adding that properties that appear abandoned are at the greatest risk of incidents. “If it looks vacant — the landscaping is overgrown, the windows are boarded — that is when you might see issues,” he said.
Vacant properties are vulnerable to vandalism and fire, he said. “Vandalism and fire threats have always been the biggest concerns on vacant properties,” Shah said. “We are getting individuals walking into vacant houses and stealing copper pipes and wiring.”
Vandalism and fire have always been the biggest concerns on vacant properties.
Owners of vacant property are also at risk for break-ins. In San Antonio, Texas, police arrested a man in December who was accused of stealing appliances from vacant newly constructed homes, News4SA reported. Commercial properties are also at risk for these losses. In September of 2024, a man was charged with breaking into a vacant former hospital in New Castle County, Delaware, and stealing copper wiring from it; earlier in the year, other trespassers were found in the same building and charged with stealing copper piping, Delaware Online reported.
Water damage is another risk for vacant properties. “If nobody goes into a house for 30 days and during that time there is a small pinhole leak in the plumbing, by the time someone discovers it, the whole house could be full of water,” Van Overbeke said. “When you do not have somebody coming in and out of the house, something bad could be happening inside and nobody would be aware of it.”
How insurance covers vacant homes, businesses
When a home or commercial building is left vacant, the owner may not realize that they are still generally responsible for any injuries that may take place on the property — whether or not anyone was permitted to be there, Short pointed out. Squatters, for example, “not only damage the property but also create liability issues,” as someone occupying the home without permission could still sue the owner over injuries they sustain in a slip-and-fall or other accident, he said. “The property owner is 100% liable,” he said.
Insurance is an important way that owners of vacant property can help mitigate their risks, but they must ensure that their insurance broker is aware of the property’s vacant status. Homeowners Insurance and Commercial Property Insurance are available for vacant properties but may differ from standard policies when the building is unoccupied. Deductibles are often higher, Short said, and coverages may vary. “You usually cannot get a $1,000 deductible anymore,” for example, he said.
Commercial Property Insurance, which can cover the replacement of stolen items and the cost of repairing physical damage to the building, may include separate sublimits or exclusions for theft and vandalism. “Owners really need to pay attention to their vandalism exclusions or sublimits on a Commercial Property Insurance policy,” Short said. “If you have a fire loss or something is stolen, it could all be related to vandalism or even arson — and these are not covered losses on many policies if that vandalism exclusion exists.”
Vandalism “is a huge concern for a vacant home,” Van Overbeke agreed, and coverage should be discussed with an insurance broker. “Many property owners do not know whether or not they have vandalism coverage built into their policy,” he said.
Homeowners Insurance for a vacant house may be referred to as Dwelling Fire Insurance and is specifically designed to address vacant home perils. Standard Homeowners Insurance policies may include a vacancy clause stating that a home unoccupied for more than 30 days will not be covered for perils such as water damage or vandalism.
“There should be language in everyone’s Homeowners Insurance policy about the amount of time a home can be vacant,” Van Overbeke explained. “The policy language is often much more limited for a vacant home. It is somewhat of a downgraded policy, and it will usually only be available for up to three years.”
These policies are typically more expensive than standard coverage, and homeowners “almost always have to go to the Excess & Surplus market” to access it, he added.
Homeowners Insurance and Commercial Property Insurance policies in Canada may also be worded differently for vacant properties, Shah said. “If you have a Homeowners Insurance policy, you may get a grace period of 30 to 60 days in a lot of policy wordings,” he said. “Once you hit that threshold, coverage is usually going to be restricted. The exposure is higher, and the company is going to rate accordingly for that.”
A property’s Homeowners Insurance policy would generally extend to liability risks as well as property risks, and owners of vacant commercial property would need to carry Commercial General Liability (CGL) Insurance to obtain coverage for third-party bodily injuries and property damage.
“Property owners should double-check and make sure they see that word ‘liability’ and know the limit on their policy,” Van Overbeke said. “It is important.”
How to protect your vacant property
In addition to obtaining insurance to help mitigate financial losses, owners of vacant property should take proactive measures to help reduce the risk of costly incidents. The U.S. Fire Administration urges property owners to monitor vacant properties closely to prevent fires and other criminal activity, and municipalities may have varying regulations on how vacant property should be maintained to limit risks.
Heat should be left on in vacant properties and should generally be kept above 55 degrees — which may be required by the insurance carrier — and vacant properties should be checked at least once a week. “If a pipe bursts and this is not noticed for two or three weeks at a time, that can lead to incredible damage,” Short said.
If a pipe bursts and this is not noticed for two or three weeks at a time, that can lead to incredible damage.
According to Van Overbeke, exterior cameras, monitoring systems, central station alarms and water flow meters may also be recommended for vacant properties. Water may need to be turned off, Shah added, and landscaping should be well-maintained, including removing overgrown weeds and shoveling as needed. “Having someone check in on the house regularly is a good idea. If no one can do that, consider a property management company or a real estate agent,” Shah said.
Property owners should be open with their insurance broker about their home’s occupancy status, Van Overbeke noted. For example, if a vacant home will be used as a vacation rental seasonally, insurance rates may be lower because the home would be occupied more frequently. “If you tell them, they can just add the correct language,” he said. “Having an honest conversation with your broker is so important.”
Although there is a trend toward self-insurance as insurance rates for vacant property increase, this can present a substantial risk. “There are huge inherent exposures now with vacant properties, especially the opportunities they allow for homeless individuals or squatters,” Short said. “You do not want to go without insurance.”
Beyond insurance coverage and risk mitigation, property owners should think carefully about their plans for their vacant property. “They should try to come up with a plan of what they want to do with it,” Van Overbeke suggested. “That gives them an incentive internally to protect that property. Now they see it as an investment instead of a hassle. You want to protect your investments.”
