Airbnb Home Insurance: When a Failure to Disclose Could Lead to Loss of Coverage
Have you disclosed your property rental business to your insurance agent? If not, you could lose coverage. The problem is that renting out your property is considered a business activity – something that most homeowner insurance plans refuse to cover. In fact, most homeowner insurance contracts have a section that threatens to terminate your coverage if you fail to disclose your rental activities.
One Canadian family found this out the hard way. Back in 2015, Mark and Star King rented out their property only to end up with $150,000 in damages after their guest held an unauthorized party. It was only when they contacted their homeowner’s insurance that they realized the damages were not covered. The Kings were forced to live in an apartment for over 4 months while cleaning crews and renovators fixed their home.
You Need Airbnb Insurance
While there is built-in Airbnb home insurance offered by the popular booking company, it does not protect your cash and securities, pets, or shared/common areas in addition to rental income. Known as the Airbnb Host Guarantee, this type of coverage is actually not insurance at all — it’s a guarantee offered by Airbnb, and reimbursement is up to them.
Airbnb liability insurance is offered through their Host Protection plan, but there’s an extensive list of exclusions and requirements that make it difficult to receive reimbursement for all but the most minor of issues. Furthermore, issues like assault and malicious damage are not covered. And the reimbursement limit is arguably too low. Liability claims and property damage can easily exceed seven figures, which could cause a problem for unprepared property owners.
If you’re planning to rent out your property using Airbnb or another short-term vacation rental booking service, make sure to talk with your home insurer first. If coverage for your rental isn’t offered, you may want to consider obtaining home insurance for Airbnb.
Quote Your Short-Term Vacation Rental Today
Interested in a policy to protect you and your business from liability and damage claims? Proper Insurance leads the nation in short-term rental insurance, with over 100,000 policies written in all 50 states. Backed by Lloyd’s of London and exclusive endorsements from vacation rental leaders such as HomeAway and Vrbo, Proper Insurance is built on world-class insurance coverage.
Proper’s policy covers vacation homes, townhouses, condos, duplexes, cabins, cottages, apartments, and more. With expert vacation rental underwriters, we can tailor a policy specific to your short-term rental property.
