Homeowners Insurance for Airbnb Hosts: Ultimate Guide

Being an Airbnb host can be a great way to generate income. It’s important for hosts to understand that this is an actual business activity and that their home insurance might not protect them in the event of a loss. Hosts might need to add an endorsement to their existing homeowners' policy or purchase a policy for short-term rentals.

The best way to purchase Airbnb insurance is through a broker. It makes getting approved in any location easier and results in lower rates. Get an instant quote from Obie, the top rated insurance solution for short-term rental hosts.

What Airbnb Insurance Is

Airbnb insurance is a policy that provides protection for your Airbnb property. This insurance may be purchased through Airbnb, added as an endorsement through your existing homeowners' policy, or purchased as a separate policy from an insurance carrier. 

Airbnb offers host liability insurance which is $1 million in liability coverage. This protects hosts if a guest gets hurt on the property, experiences personal property damage while staying on site, or gets their belongings stolen from the property. This is limited coverage and doesn’t offer protection for the actual structure.

To get coverage for the structure, the host needs to get other insurance. If the host also lives on the property, they may be able to get an endorsement for business use on their homeowners' policy. If they are not living on site, they will want to get rental property insurance specializing in short-term rentals. This policy will offer liability protection on top of the structural and property protection that hosts also need in the event of a fire, water damage, or theft. 

Homeowner Insurance Coverage for Airbnb

Because hosting rental guests is a business activity, most homeowners insurance policies will not provide coverage for losses associated with the business. If you live on the property, you likely have a homeowners insurance policy to protect yourself from losses such as fire, theft, and vandalism. However, unless your insurance carrier offers an endorsement and you get it, your homeowners' policy won't cover these events. 

Landlord Insurance Coverage for Airbnb

When you rent out your property in its entirety, you will want to get landlord insurance to appropriately protect against losses. Your insurance company will want to know if the property is being rented out for long-term tenants or short-term guests. Policies are priced differently for short-term guests as there is a higher risk of property damage in these situations. 

How Airbnb Insurance Works

Airbnb insurance works like any other insurance policy for the perils covered in the policy. Common perils include fire, water damage, and theft. It also covers liability in the event that a guest gets hurt or experiences personal property damage while staying. Should a loss occur, the host will open a claim with the insurance carrier. A claims representative reviews the details of the loss to determine whether it is a covered claim. Insurance carriers pay for covered losses with a check or by repairing or replacing property.

Reasons Hosts Need Airbnb Insurance

Airbnb hosts need to have insurance to protect against losses. Hosts can insure the structure if the live-in host has a homeowner’s policy in place, but they still need liability protection in case of a loss. 

Common things that can happen to guests resulting in liability responsibility include: 

• A guest slipped in the kitchen and fell, breaking their hip in the fall
• The leg on a dining room table is wobbly, leading to a guest's laptop falling from the table and breaking
• A thief breaks into the home and steals the guests belongings

What Insurance Airbnb Hosts Need

Airbnb hosts need two types of coverage: liability coverage and property protection. The liability coverage is all that Airbnb in-house policies offer, leaving a significant gap in coverage for hosts. If the property itself is not protected, hosts risk losing everything if there is an incident such as a fire. Property protection covers more than just the structure; it covers the business property in the Airbnb, including furniture, kitchen appliances, and home goods. 

Insurance Offered By Airbnb

Major hosting platforms such as Airbnb and Vrbo offer general liability insurance for no additional cost. These policies provide $1 million in general liability protection for hosts. Because the policies are associated with being a host on a given platform, the insurance is for business activities associated with that platform. This means you won’t file a claim on your Airbnb policy for a Vrbo rental if you host on both platforms. 

Best Airbnb Insurance Companies

If you’re looking for Airbnb insurance, consider these top companies for a policy: 

• Obie: A national insurance broker that specializes in rental properties. Obie understands the risks of short-term rentals and will make sure your policy properly protects you.
• State Farm: With agents all across the country, State Farm becomes a small business partner with you to provide the protection you need on your short-term rental. 
• Allstate: As a leading homeowners insurance provider, Allstate is an excellent choice for hosts who live in their rental homes and want an inexpensive endorsement for their property. 
• Nationwide: Nationwide works with homeowners to bundle personal policies with their business rental income policy. This helps property owners maximize discounts on policies. 

Takeaway

Homeowners' policies may not always be enough to cover you when you have an Airbnb. Consider Obie for your short-term rental property insurance coverage, getting a comprehensive policy that covers you for common losses. Remember that short-term rental property insurance policies will be more expensive than a traditional homeowners insurance policy, but it is an expense that you can write off on your taxes.  

The best way to purchase Airbnb insurance is through a broker. It makes getting approved in any location easier and results in lower rates. Get an instant quote from Obie, the top rated insurance solution for short-term rental hosts.