Airbnb, VBRO and HomeAway members need special coverage for brief or seasonal rentals.
Home sharing has become a popular way to earn extra income from a property, but all too many of those owners fail to obtain short term rental insurance. Regardless of whether a condo, seasonal property or home is rented in its entirety or just a portion, these guests are not typically covered by standard homeowners insurance.
That said, this doesn’t mean that there isn’t any coverage at all for these helpful income sources.
There are many home rental networks that are well recognized around the world, including Airbnb, VBRO and Homeaway. These offer a secure way for property owners to be able to assess potential temporary tenants. However, every program has its limits and loss or damage can happen regardless of how well the renters were screened.
Standard homeowners insurance typically covers only private use of a home. When it starts to be rented out – in part or in its entirety – it becomes something other than what a standard home policy will cover. Short term rental insurance is the type of coverage property owners can obtain in order to cover loss and damage that can occur as a result of a temporary or seasonal tenant. This can often be added to an existing homeowners insurance policy but may also be available as a stand-alone coverage.
Short term rental insurance covers issues such as theft, vandalism and many other types of damage.
Among the types of coverage available in a typical temporary rental policy include:
• Theft or attempted theft from the renters or the renters’ guests
• Damage resulting from renter vandalism
• Property damage or theft to the renter’s property (up to a certain limit identified on the policy)
• Fair rental value
Beyond obtaining the right insurance coverage, property owners are also typically advised to take some careful steps in order to reduce the risk that a claim will need to be made in the first place. These include locking up personal items that must be kept on the property, particularly if they are valuable items. Changing pass-codes between tenants is also often recommended. Codes include those to access WiFi, but also those for garage doors or other points of entry and access. Leaving a guide for tenants to use to properly use appliances, electronics and amenities can help to prevent accidental damage from misuse of these features.
Even with short term rental insurance, it’s important to take a careful inventory of the property and possessions. This should include supporting documents such as receipts, appraisals, photographs and video.
