If you plan on using your property for an Airbnb rental, you need to have an Airbnb insurance for owners policy that offers comprehensive coverage. A standard homeowner’s insurance policy is generally not going to cover damages or injury for claims filed during the rental period. In fact, most insurance companies do not extend any type of homeowner’s coverage to short-term rentals such as those listed on Airbnb or VRBO. This is because of a “business activity exclusion” that is found in most homeowner’s policies. In fact, certain homeowner’s policies are voided or even cancelled if you rent your home out to other people. That’s because once you are earning income on a property, it’s considered a business, which carries a greater amount of risk than a personal dwelling. This can leave you financially vulnerable if a guest is injured or damages your property.
Getting the Right Insurance Coverage Makes All the Difference
Some property owners elect to purchase a separate commercial liability plan to use in addition to their homeowner’s insurance. These plans can offer additional coverage but they typically are not tailored to the unique needs of a short-term property rental situation. Plus, managing both a homeowner’s insurance and commercial coverage plan can be costly. Proper Insurance® offers a single comprehensive plan designed to cover all your needs from homeowner’s coverage to rentals insurance. Don’t rent out your valuable property without the right coverage in place. Talk with us to obtain your own coverage today.
What About the Host Protection Insurance & Host Guarantee?
If you’re thinking about relying on Airbnb’s own Host Protection Insurance and Host Guarantee, think again. If you’re not familiar with Host Protection, it is essentially a free $1 million policy that Airbnb gives to owners for each property listed on the site. Free insurance plans often come with so many exclusions that it’s difficult to get reimbursement for a claim. With the Airbnb Host Guarantee, you have a short window of time to file a claim, and it comes with all sorts of other caveats. Plus, the Host Protection Insurance is a shared policy. That means tens of thousands of property owners must share the policy limits. If the limit is reached before you file a claim, then you’re out of luck. When you’re renting out property through Airbnb, you need a real insurance plan that’s designed to cover all your bases from liability to property damage. Unfortunately, free coverage rarely offers the same protection that a policy you can buy does.
Airbnb for Owners: Why Insurance May Be Legally Required
The vacation rental industry has grown enormously over the last few years and now local and state governments are adopting new laws that govern over Airbnb, FlipKey, VRBO, HomeAway, and other rental services. In some cases, certain areas require property owners to maintain adequate commercial liability insurance and property damage coverage. And unfortunately, your homeowner’s insurance doesn’t qualify. As a result, countless property owners are not only not-compliant with the law, they’re placing themselves at serious risk if their property is damaged or a guest decides to file a lawsuit. As the laws involving rentals are constantly evolving, it’s likely only a matter of time until these are nationwide requirements. Make sure you’re covered before you list your property for rent!