1. Conventional insurance. If the home simply needs some basic maintenance, and you will be able to complete repairs and move in within 30 days of closing, you can likely get a conventional insurance policy through a traditional insurance company.
In this case, the usual insurance company will likely recommend a different type of insurance, specially formulate for higher-risk situations like yours. Some insurers will still write the policy themselves, while others will refer you to a third-party insurer that specializes in higher-risk policies.
2. Builder’s risk. This is the most general type of renovation or new construction homeowners insurance. This policy usually starts with lower costs, and as you get the home into better condition, the costs rise because the home becomes more valuable. Builder’s risk policies are easiest to get if you have a solid, timely plan to finish the reconstruction.
3. Vacant dwelling. If your home mostly needs beauty work but will sit empty while the work is being done, a vacant house policy is possible. These basic policies will protect a home against most bodily losses, Keep in mind that depending on where the home is located, theft could be a huge problem, especially if the home contains valuable appliances, tools and piping.
4. homeowner's insurance. An HO-8 policy is an insurance policy designed for an older home. Not like more common HO-2 and HO-3 policies, an HO-8 policy wouldn’t cover stand-in costs of your home if you lose all. An HO-8 policy is suitable if your home isn’t in terrible condition, and if you plan to live in it while it’s under construction.
5. Fair Access to Insurance Requirements plan. What if you are in an unusual situation in which your repairs will take a long time? In this case, you may have problem getting an insurer to underwrite even one of the above insurance policies.
If this is your situation, look into your state FA I R plan. These plans, which are available in most states, are specifically for situations like yours. FAIR plans offer a extremely basic level of insurance, but it’s better than nothing.
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