Are you considering changing your property to a short term rental? If you are considering it, or if you already have, do you have the proper short term rental insurance or Airbnb insurance? Many landlords are surprised to find out that their regular policy does not allow short term rentals. If it does, there are usually minimum stays or limits to how many times it can be rented per year.
Standard Homeowner’s Policy
Most homeowner’s policies exclude business operations, and many short term rentals fall into this category. These policies may also have limits on roomer’s and boarders if you are using a portion of the home as your primary residence and renting out a portion of it.
Check with your carrier or agent to see if they have any limitations or restrictions if you are using part of your primary home as a vacation rental.
Standard Landlord Insurance
Your standard Florida landlord insurance policy is typically set up for annual, long-term rentals. Usually this question is asked as part of the underwriting guidelines, and many companies do not provide coverage for short term rentals. Each company may define a short term rental differently based on the length of the lease or the number of times rented per year.
If you haven’t adjusted your policy to show short term rental insurance, you want to make sure you check with your carrier or agent to make sure that you are operating within the policy guidelines. Many of the landlord policies that we write don’t allow short term rentals, so if you have any questions on this, feel free to give us a call to discuss your situation.
Landlord Insurance with Short Term Rental Insurance Endorsement
For the landlord policies that will allow Airbnb, VRBO, or Vacation rentals, most have an endorsement that you must add. There is usually a slight charge for this additional coverage, and there are often restrictions. What is your minimum stay? What occupancy/vacancy is allowed? Are there any exclusions?
There are some good companies with the Airbnb insurance or short term rental insurance endorsement. You just want to be sure that you know all the requirements and limitations if you choose to go this route. We write policies with several of these carriers, and we are happy to answer any questions that you may have.
Specially Designed Airbnb Insurance or Vacation Rental Insurance
As Vacation rentals become more common, insurance companies have seen the need for specialty coverage to cover these types of properties. These policies offer:
- Commercial package for liability, building and personal property coverage, plus income loss. This is standalone coverage, so it takes the place of your existing landlord or homeowner policy.
- There are no occupancy restrictions, so you can use your Airbnb or live in part of the property and use another portion for your short term rental.
- Available coverage enhancements for theft and damage from renters
- Available liability enhancements for pets, liquor, pools, watercraft, golf carts, and more!
- Some companies have discounts for noise or party detection systems. Make sure to check out Party Squasher, which is a simple system that counts the number of mobile devices on your property.
Wait – Doesn’t Airbnb Already Cover Me?
Airbnb has Host Protection Insurance and Host Guarantee (Learn More). These coverages are liability protection while you have a guest and Host Guarantee covers your property if the guest causes damage during their stay. There are a few things to consider if you are thinking about relying on this coverage:
- You still need your home or landlord coverage for other risks, like storms, fire, etc.
- What exclusions does it have?
- What coverage do you have or need when in between bookings and the property is vacant?
Full terms are available on the Airbnb site. For info on VRBO or other vacation rental programs, you’d want to research what coverage they may provide directly with them.
Whether you are renting out part of your primary residence or you have a full blown vacation rental business, you want to make sure that you have the right short term rental insurance policy for your property.
Our team at Think Safe Insurance is here to help you with any questions that you may have. We also want to make sure that you have the right policy in place. Give us a call at 813-425-1626 or request a quote online.