Having a second or vacation home might be a wise financial decision. It's a place to escape it all during the summer or whenever the mood strikes. The lack of a permanent resident increases the likelihood of theft at a second property. Therefore insurance premiums might be higher for such properties than for primary residences. Fortunately, our colleagues at the Insurance Information Institute have provided suggestions for maintaining manageable tips.

Affecting the price of your vacation home insurance are these key factors:

Although a secondary residence policy will have the same coverage as a main residence policy, premiums may vary depending on the following criteria.

Location: The cost of home insurance may be significantly impacted by the location of the insured property. The area of a vacation house may increase both its value and its insurance premiums. Wildfires pose a larger threat to outlying structures, such as ski cabins and hunting lodges, located in forested or hilly regions. Damage from hurricane winds or storm surges might be magnified in a coastal home. Insurance premiums will be affected by these location-based risks, and in certain situations, larger deductibles will apply.

Property: Like any other residence, the cost of insuring a second home depends on factors such as age and the construction materials it was built with. You should also consider if your secondary residence is a condo, a townhouse, or a single-family home. For instance, a condo in a ski town could have cheaper insurance than a chalet in the same location. The association's insurance policy covers just the building's façade, which is a major plus (the cost of it is generally included in the monthly maintenance fees). If anything happens to your condo, you might file a claim with your insurance coverage, which would pay to repair or replace your personal property and any damaged common spaces.

Amenities: pools and hot tubs are great for leisure but can increase the risk of owning a second house. You may have to pay a higher premium for your homeowner's insurance if your vacation home has these or other high-priced features. It would help if you also considered purchasing extra liability protection, which may increase your rate.