Short-Term Rental (STR) Insurance

Short-term rental (STR) insurance, also known as vacation rental insurance, is a type of insurance coverage designed to protect property owners, managers, and hosts who rent out properties on a short-term basis to guests, often through platforms like Airbnb®, Vrbo®, or Booking.com® but also direct booking.

This insurance provides coverage for various risks and liabilities that can arise from renting out a property, such as damage to the property, injuries to guests, theft, and other potential incidents.

Most property owners are unaware they need specialty short-term rental insurance because neither homeowners nor landlord insurance adequately covers Airbnb®, Vrbo®, and other short-term rental exposure.

When you entrust your property to a paying short-term rental guest, giving them the keys to your house, you as the owner need to make sure you have the right coverage in order to protect your investment.

Potential damage caused by a guest may include physical damage to your property, theft, lost business revenue, and a slew of liability concerns surrounding the potential injury to a guest.

Short-term rental insurance is a means of managing risks associated with renting out a vacation rental property for a short amount of time. It helps protect you as a property manager and/or owner from various risks that may befall your property and business in the future.

By ensuring your financial security in the face of various financial risks in the future, you can focus on running your short-term vacation rental business optimally, maximizing bookings and revenue.

There are many reasons or risks to protect against for property managers to obtain short-term rental insurance:

1. Liability Coverage

Property managers and homeowners can be held liable for accidents or injuries that occur on the rental property. Short-term rental (STR) insurance provides liability coverage in case a guest or visitor gets injured and decides to hold the property manager and/or owner responsible. This coverage can help cover legal expenses and potential settlements.

2. Property Damage

If guests cause damage to the property during their stay and refuse to cover the costs of the damage, short-term rental insurance can provide coverage, helping vacation rental hosts avoid financial losses.

3. Protection Against Lawsuits

In the event of a lawsuit from a guest or neighbor related to the vacation rental property, property managers and homeowners can face legal expenses and potential damages. Short-term rental insurance can offer protection in these situations by covering legal costs and potential settlements.

4. Loss of Income

If a property becomes temporarily uninhabitable due to reasons such as extensive property damage caused by guests or natural disasters like hurricanes and earthquakes, short-term rental insurance with loss of income coverage can reimburse the income they would have otherwise earned.

Loss of income coverage can also apply to circumstances that prevent guests from turning up for their stay where hosts lose out on their income such as a volcano eruption that prevents air travel or a pandemic-related travel restriction.

5. Guest-Related Incidents

Sometimes, guests may cause problems beyond property damage, such as noise complaints, other disturbances, and illegal activities. Vacation rental insurance can offer coverage for situations where vacation rental hosts need to address and mitigate such incidents.

6. Theft

In the unfortunate event of theft by guests, short term rental insurance can cover the value or cost of replacing lost items. This can also be written to include belongings to be found in areas of the property that are restricted to guests.

7. Professional Liability

Property managers may also face claims related to their professional services, such as mismanagement of bookings, misleading advertisements, or failure to uphold safety standards. Such claims may be filed by homeowners or guests. Some short-term rental insurance policies include professional liability coverage to address these situations.

Selecting the appropriate insurance for your short-term vacation rental depends on various factors, including the property's location, size, amenities, and how often you rent it out. It's essential to review policy terms, coverage limits, deductibles, and any exclusions before making a decision. You can also request for tailored coverage that excludes certain coverage and includes others to more comprehensively cater to the unique risks associated with your vacation rental property and short-term rental business.

Protecting your investments and future earnings while ensuring the safety of your guests and belongings is a top priority for vacation rental hosts. Choosing the right insurance coverage can provide you with peace of mind and financial security, allowing you to focus on providing an exceptional experience to your guests, and growing your business.

Please contact us and we will help customize coverage for your vacation rental property.