Airbnb is a popular platform that allows people to rent out their homes or parts of their homes to travelers. It can be a great way to earn some extra income and share your space with others. However, it also comes with some risks, such as property damage, theft, or liability claims. If you are an Airbnb host, you may wonder if your home insurance covers Airbnb losses or if you need additional insurance to protect yourself and your property. The answer is not simple, as it depends on your policy, Airbnb’s insurance, and the type and frequency of your rental activity. In this article, we will explain what you need to know about home insurance for Airbnb and how to find the best insurance option for your situation.
Homeowners Insurance and Home Sharing
Homeowners insurance is a type of insurance that covers your home and personal belongings from various perils, such as fire, wind, hail, theft, vandalism, and more. It also provides personal liability coverage, which means it can pay for the medical expenses or legal fees if someone gets injured on your property or if you cause damage to someone else’s property.
However, homeowners insurance is not designed to cover home sharing, which is when you rent out your home or a part of it to guests for a short period of time. Home sharing can affect your homeowners insurance coverage in several ways:
- It can void your policy: Some homeowners insurance policies explicitly exclude or limit coverage for home sharing or any business activity on your property. This means that if you rent out your home through Airbnb without notifying your insurer, you may lose your coverage entirely and have to pay for any losses out of pocket.
- It can increase your risk: Even if your policy does not exclude home sharing, it may not cover all the risks associated with it. For example, if your guests cause intentional or accidental damage to your property or belongings, steal your valuables, or sue you for negligence or injury, your policy may not cover these losses or may not cover them fully.
- It can raise your premiums: If you inform your insurer that you are renting out your home through Airbnb, they may adjust your premiums accordingly to reflect the increased risk. They may also require you to purchase a specific endorsement or rider to extend your coverage to home sharing.
The bottom line is that you should always check with your insurer before renting out your home or a part of it through Airbnb. You should read your policy carefully and understand what is covered and what is not. You should also ask about any exclusions, limitations, deductibles, or conditions that apply to home sharing. You should also compare different policies and insurers to find the best deal for your needs.
Read: Does home insurance cover asbestos removal?
Airbnb’s Insurance Options
Airbnb offers two types of insurance options for hosts: the Host Guarantee and the Host Protection Insurance. These are meant to supplement your existing homeowners insurance and provide some additional protection for Airbnb losses. However, they are not comprehensive and have some limitations and exclusions that you should be aware of.
Airbnb Host Guarantee
The Airbnb Host Guarantee is a program that provides up to $1 million of coverage for property damage caused by guests to your home or personal belongings. It covers both intentional and accidental damage, such as broken furniture, stained carpets, damaged walls, etc. However, it does not cover:
- Cash, securities, jewelry, collectibles, artwork, or other valuables
- Pets or pet damage
- Wear and tear or normal depreciation
- Damage caused by natural disasters or environmental factors
- Damage caused by mold, fungus, insects, rodents, or pets
- Damage caused by the host’s own negligence or misconduct
- Damage caused by third parties other than guests
- Damage that occurs outside the booked dates or outside the booked space
To make a claim under the Host Guarantee, you must follow certain steps:
- You must try to resolve the issue with the guest directly within 14 days of checkout or before the next guest checks in, whichever is earlier
- You must submit a claim through the Airbnb Resolution Center within 14 days of checkout or before the next guest checks in, whichever is earlier
- You must provide documentation and evidence of the damage, such as photos, receipts, invoices, etc.
- You must cooperate with Airbnb and its partners in the investigation and resolution of the claim
- You must agree to the terms and conditions of the Host Guarantee
The Host Guarantee is not an insurance policy and does not replace your homeowners insurance. It is subject to change at any time and may not be available in all locations. You should read the full terms and conditions of the Host Guarantee before relying on it.
Airbnb Host Protection Insurance
The Airbnb Host Protection Insurance is a liability insurance program that provides up to $1 million of coverage for bodily injury or property damage claims brought by third parties against hosts or guests. It covers incidents that occur during a booked stay on or in the host’s property or in common areas of the building. For example, it can cover:
- A guest slipping and falling on your stairs and breaking their arm
- A guest accidentally starting a fire in your kitchen and damaging your neighbor’s apartment
- A guest’s dog biting someone on the street and causing an infection
However, it does not cover:
- Liability claims brought by the host or the guest against each other
- Liability claims brought by the host’s family members, roommates, or employees
- Liability claims arising from intentional acts, criminal acts, or gross negligence by the host or the guest
- Liability claims arising from communicable diseases, pollution, asbestos, lead, or mold
- Liability claims arising from products or services provided by the host or the guest
- Liability claims arising from vehicles, aircraft, watercraft, or animals owned or operated by the host or the guest
To make a claim under the Host Protection Insurance, you must follow these steps:
- You must notify Airbnb as soon as possible after becoming aware of a potential claim
- You must provide documentation and evidence of the incident, such as photos, medical records, police reports, etc.
- You must cooperate with Airbnb and its partners in the investigation and defense of the claim
- You must agree to the terms and conditions of the Host Protection Insurance
The Host Protection Insurance is an actual insurance policy underwritten by certain insurers in different countries. It is subject to change at any time and may not be available in all locations. You should read the full terms and conditions of the Host Protection Insurance before relying on it.
Read: Does Your Home Insurance Cover Water Damage?
Short-Term Rental Insurance for Airbnb Hosts
If you are looking for more comprehensive and reliable insurance coverage for your Airbnb rental activity, you may want to consider purchasing a short-term rental insurance policy. This is a type of insurance that is specifically designed to cover home sharing and vacation rental hosts. It can provide coverage for both property damage and liability claims that may not be covered by your homeowners insurance or Airbnb’s insurance options.
Short-term rental insurance can cover:
- Property damage caused by guests or natural disasters to your home or personal belongings
- Liability claims brought by guests or third parties for bodily injury or property damage that occur on your property or in common areas of the building
- Loss of income due to cancellation, interruption, or eviction of your rental activity
- Additional expenses incurred due to relocation, repair, or replacement of your property
Short-term rental insurance can vary depending on the provider, policy, and location. Some factors that can affect the cost and coverage of short-term rental insurance are:
- The size, type, and location of your property
- The frequency and duration of your rental activity
- The number and profile of your guests
- The amenities and services you offer to your guests
- The deductible and limit you choose for your policy
To find the best short-term rental insurance for your needs, you should compare different providers and policies and read the fine print carefully. You should also check the reviews and ratings of the providers and policies from other hosts and customers. Some of the leading providers of short-term rental insurance are:
- Proper Insurance: Proper Insurance is one of the most comprehensive and flexible providers of short-term rental insurance. It offers up to $2 million of property and liability coverage per location, with no limit on the number of locations or bookings. It also covers business income, personal liability, pet damage, bed bugs, liquor liability, mold, fungus, pollution, and more. It replaces your existing homeowners or landlord policy and covers both personal and commercial use of your property. It is available in all 50 states and works with all booking platforms.
- Slice: Slice is a provider of on-demand short-term rental insurance that allows you to pay only for the days you rent out your property. It offers up to $2 million of property and liability coverage per booking, with no annual limit on bookings. It also covers loss of income, cyber liability, infestation, vandalism, theft, fire legal liability, medical payments, and more. It works as a supplement to your existing homeowners or landlord policy and covers only commercial use of your property. It is available in 28 states and works with all booking platforms.
- CBIZ: CBIZ is a provider of customized short-term rental insurance that tailors your coverage to your specific needs. It offers up to $1 million of property and liability coverage per location, with no limit on the number of locations or bookings. It also covers loss of income, personal liability, theft, vandalism, fire legal liability, medical payments, and more. It works as a supplement to your existing homeowners or landlord policy and covers both personal and commercial use of your property. It is available in all 50 states and works with all booking platforms.
Read: Does Home Insurance Cover Roof Leakes?
Final Words!
Renting out your home through Airbnb can be a rewarding experience, but it also comes with some risks that you need to protect yourself from. Your homeowners insurance may not cover Airbnb losses or may have some exclusions or limitations that can leave you vulnerable. Airbnb’s insurance options may provide some additional protection but they are not comprehensive and have some limitations and exclusions that you should be aware of.
Therefore, if you want more comprehensive and reliable insurance coverage for your Airbnb rental activity, you may want to consider purchasing a short-term rental insurance policy. This is a type of insurance that is specifically designed to cover home sharing and vacation rental hosts. It can provide coverage for both property damage and liability claims that may not be covered by your homeowners insurance or Airbnb’s insurance options.
