diff --git a/homeassistant/components/alarm_control_panel/nx584.py b/homeassistant/components/alarm_control_panel/nx584.py
index 58ec8d915ab..b7b3beec72d 100644
--- a/homeassistant/components/alarm_control_panel/nx584.py
+++ b/homeassistant/components/alarm_control_panel/nx584.py
@@ -16,7 +16,7 @@ from homeassistant.const import (
     STATE_UNKNOWN, CONF_NAME, CONF_HOST, CONF_PORT)
 import homeassistant.helpers.config_validation as cv
 
-REQUIREMENTS = ['pynx584==0.2']
+REQUIREMENTS = ['pynx584==0.4']
 
 _LOGGER = logging.getLogger(__name__)
 
@@ -86,9 +86,11 @@ class NX584Alarm(alarm.AlarmControlPanel):
             _LOGGER.error('Unable to connect to %(host)s: %(reason)s',
                           dict(host=self._url, reason=ex))
             self._state = STATE_UNKNOWN
+            zones = []
         except IndexError:
             _LOGGER.error('nx584 reports no partitions')
             self._state = STATE_UNKNOWN
+            zones = []
 
         bypassed = False
         for zone in zones:
diff --git a/homeassistant/components/binary_sensor/nx584.py b/homeassistant/components/binary_sensor/nx584.py
index b21e40dc5dd..ad7612d11a6 100644
--- a/homeassistant/components/binary_sensor/nx584.py
+++ b/homeassistant/components/binary_sensor/nx584.py
@@ -16,7 +16,7 @@ from homeassistant.components.binary_sensor import (
 from homeassistant.const import (CONF_HOST, CONF_PORT)
 import homeassistant.helpers.config_validation as cv
 
-REQUIREMENTS = ['pynx584==0.2']
+REQUIREMENTS = ['pynx584==0.4']
 
 _LOGGER = logging.getLogger(__name__)
 
diff --git a/requirements_all.txt b/requirements_all.txt
index cb04ecbab75..79cfbb5c588 100644
--- a/requirements_all.txt
+++ b/requirements_all.txt
@@ -442,7 +442,7 @@ pynut2==2.1.2
 
 # homeassistant.components.alarm_control_panel.nx584
 # homeassistant.components.binary_sensor.nx584
-pynx584==0.2
+pynx584==0.4
 
 # homeassistant.components.sensor.openweathermap
 # homeassistant.components.weather.openweathermap
diff --git a/tests/components/binary_sensor/test_nx584.py b/tests/components/binary_sensor/test_nx584.py
index 5481bbc9198..ef8861e12ce 100644
--- a/tests/components/binary_sensor/test_nx584.py
+++ b/tests/components/binary_sensor/test_nx584.py
@@ -106,6 +106,12 @@ class TestNX584SensorSetup(unittest.TestCase):
             requests.exceptions.ConnectionError
         self._test_assert_graceful_fail({})
 
+    def test_setup_no_partitions(self):
+        """Test the setup with connection failure."""
+        nx584_client.Client.return_value.list_zones.side_effect = \
+            IndexError
+        self._test_assert_graceful_fail({})
+
     def test_setup_version_too_old(self):
         """"Test if version is too old."""
         nx584_client.Client.return_value.get_version.return_value = '1.0'