Airbnb is a pioneer of the sharing economy, allowing hosts to rent out part or all of a property to travellers. While many Airbnbs are advertised as an “entire place,” meaning guests have the entire house or apartment to themselves, many listings consist of a private room. Hosts renting out either type of Airbnb qualify for up to $1 million in liability protection insurance, but may also consider exploring an add-on home sharing policy for additional coverage.
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What is home-sharing insurance?
Home-sharing protects your property as a business when you rent it out through Airbnb. Not only do you get more coverage, you also file your claims directly through the insurance provider rather than relying on Airbnb. Different insurance companies offer different types of home-sharing policies. You may be able to add on an endorsement or rider, which provides extra coverage to your existing homeowners insurance. Alternatively, you may choose an all-inclusive policy that automatically combines homeowners and home-sharing coverage. All home-sharing policies should include protection against theft, damage and liability.
Explore your options and find a plan before you list your home on Airbnb. You never know when an unexpected event might occur that could leave you liable for someone else’s losses or your own. Either way, make sure you’re completely covered by your respective insurance policies before you actually need it.
Homeowners insurance and home sharing: what does it cover?
A standard homeowners insurance policy covers four types of financial protection: your home’s structure, your personal belongings, liability and additional living expenses. When a qualifying event occurs and your home and/or personal belongings are damaged, you can file a claim for reimbursement, as long as it’s more than your deductible. The liability portion protects you in case someone is injured or has property damaged while on your property. Finally, additional loss of use living expenses pay for your lodging in case your house isn’t livable while repairs are being made.
[Related: The Best Home Insurance of 2020]
At first glance, it sounds like your homeowners insurance liability coverage should be adequate when renting out a room on Airbnb. But unfortunately, most insurers don’t include short-term rentals in a standard policy. Home sharing or peer-to-peer rental insurance may be the better option for protecting your home and your Airbnb guests. Depending on how frequently you plan on renting out space in your home, your existing policy may allow you to add on coverage through an endorsement or you may need to purchase separate business insurance.
As a renter, does home share insurance cover me?
Your own homeowners or renters insurance may cover you in the event your belongings are stolen or damaged while renting an Airbnb. Any accidents that occur while you’re on the property are also covered by Airbnb’s host guarantee.
To avoid any potential hiccups, read your host’s rules carefully so that even if an accident does happen on the property, you’ll be covered. For example, if there’s a no pet policy but your dog left claw marks all over the door, you may have trouble being covered. Pay attention and read the host’s handbook and any other rules listed when you arrive at the rental to make sure you’re covered by all of the relevant insurance policies.
Does homeowners insurance cover Airbnb properties?
While your homeowners insurance policy likely doesn’t offer much protection, Airbnb does automatically provide host protection insurance. The liability protection covers up to $1 million in the event a guest is injured or has their personal property damaged while at your home.
It covers both bodily injuries and property damage for your guests and others. The policy also covers you in the event a guest damages communal space, such as the lobby of an apartment building or a neighbor’s property.
Airbnb’s host liability protection doesn’t cover a few key scenarios, including damage from intentional acts, such as anything that wasn’t an accident. It also doesn’t cover an income loss, actual property or furnishings inside — although those may be covered by Airbnb’s host guarantee program.
When does AirBnb’s insurance cover your property?
In addition to Airbnb’s liability protection, you may be eligible for up to $1 million coverage in damages through the host guarantee program. Again, this insurance is automatic when you sign up as a host. It includes any property damage caused by guests, both in terms of the structure and the belongings inside. The policy also covers damage caused by a guest’s assistance animal.
Airbnb does have a specific process for filing a reimbursement claim. First, you’ll need to submit evidence of the damage, such as photos, videos or receipts of repairs. Then you must follow up directly with the guest within a designated timeframe to request reimbursement from them. If they refuse to pay some or all of the damage, you can then work with an Airbnb support specialist to see if you’re eligible for reimbursement through the host guarantee.
What companies offer home-sharing coverage?
Home-sharing insurance is becoming more commonplace among both traditional insurance companies and newer companies designed specifically for Airbnb hosts. Compare costs and coverage to find the best fit for your listing.
- Proper Insurance: Get an online quote in just five minutes. Policies are all-inclusive to cover both your home and your Airbnb business.
- Erie Insurance: Erie offers an add-on policy to your primary residence. Depending on your property and location, the cost could be as low as an additional $40 to $60 per year.
- Allstate Insurance: Get a Merry Maid discount and a digital locker app to track personal property in your rental.
[More: Home Insurance Quotes, Explained]
Too long, didn’t read?
Your homeowners insurance policy most likely doesn’t cover you as a host and there are some gaps in both of Airbnb’s host insurance policies. Review your existing policies in-depth to figure out what coverage may apply. An additional home-sharing insurance policy gives you the most protection for both liability and personal property when listing your home or another property on Airbnb. With a comprehensive insurance strategy, you can list your Airbnb and have the peace of mind that you’re prepared for any surprises that pop up.
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