Owning an Airbnb comes with great income potential, but it also carries risks. From guest injuries to property damage, having the right insurance coverage ensures you’re financially protected. Here’s what you need to know about insuring your short-term rental property.
1. Understand Airbnb’s Host Guarantee vs. Insurance
Many hosts assume Airbnb’s Host Guarantee is sufficient, but it’s not a substitute for proper insurance. The Host Guarantee provides up to $1 million in damage protection, but it has exclusions and doesn’t cover liability claims. Airbnb’s AirCover for Hosts provides liability protection, but relying solely on these policies can leave gaps in coverage.
2. Get a Short-Term Rental Insurance Policy
A standard homeowners insurance policy may not cover Airbnb rentals. Instead, consider short-term rental insurance (also called vacation rental insurance). Companies like Proper Insurance, CBIZ, and Safely offer policies designed specifically for Airbnb hosts, covering both property damage and liability.
3. Consider Landlord Insurance (If Applicable)
If you rent out an investment property rather than your primary residence, landlord insurance is essential. These policies typically cover:
- Property damage from tenants or guests
- Loss of rental income due to covered damages
- Liability protection if a guest is injured on your property However, some landlord policies exclude short-term rentals, so make sure yours is Airbnb-friendly.
4. Add Umbrella Insurance for Extra Protection
An umbrella insurance policy provides additional liability coverage beyond standard limits. This can be useful if a guest sues for medical expenses or damages beyond what your main policy covers. It’s an affordable way to enhance your protection.
5. Require Guests to Have Travel Insurance
Encouraging or requiring guests to have travel insurance can protect both parties. Travel insurance covers guests in case of trip cancellations, injuries, or lost belongings, reducing the likelihood of disputes over damages.
Final Thoughts
Don’t leave your Airbnb investment unprotected. By securing the right insurance policies, you can safeguard your property, income, and peace of mind. Take the time to research and compare policies to ensure you have comprehensive coverage.
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