Airbnb Host Insurance
Before wandering into a discussion about Airbnb host insurance for rental properties, it’s imperative that any future Airbnb host review Airbnb’s host protection insurance information on their website. As stated on Airbnb’s website, “The Host Protection Insurance program now provides primary coverage for Airbnb hosts and landlords, as additional insureds, in over 15 countries. Our program protects against liability claims up to $1 million USD that occur in a listing, or on an Airbnb property, during a stay.” While Airbnb does not provide an extensive list of what’s covered in the event of guest negligence, they do provide some guidance around the kinds of damage that would be covered under their host insurance policy; and, don’t forget to check on which countries are covered under this policy—the list is available on their website. If the terms of the host insurance are insufficient for your specific property, Airbnb also offers supplemental insurance called Host Guarantee Insurance. As described on Airbnb’s website, Host Guarantee Insurance is meant “to protect against rare instances of damage.
Is Additional Property Insurance Required?
Sizing up insurance needs is always a complicated task. An insurance company is typically willing to provide you with any level of base and supplemental insurance on just about anything you’d like to insure—at a cost.
In light of Airbnb’s standard Host Insurance policy, should a host carry additional property insurance? First, an Airbnb host should check to see if their existing policies will accommodate this new business-related function. Most home insurance policies carry a “business pursuit’s exclusion,” which would negate any claim involving a business’ use of the insured property.
In this context, the challenge arises when someone rents a place on Airbnb that is not their residence. The Airbnb hosts collects money and rents their dwelling to guests; which is essentially no different than a commercial hotel that carries commercial insurance. Not surprisingly, a commercial insurance policy is not designed to meet the same needs as a residential home owner’s insurance; especially as it relates to liability. Just like any responsible landlord, carrying the appropriate insurance not only protects you, the owner, but also the guests.
OK, so now that you’re informed, what steps should you take to insure your property. Well, first, you should be aware that even if you call your current insurer to hypothetically inquire about this option, they may cancel your insurance unilaterally. See some anecdotal reports of this happening recently. With few viable options available, you should check out Proper Insurance Services who offers an Airbnb-compliant home insurance policy under the umbrella of Loyd’s of London. One Airbnb host shared the following advice (see quote below):
According to my insurance agent (Erie Insurance) Lloyds of London is the ONLY legitimate insurance company that completely and legally covers an Airb&b. We found them through Proper Insurance Services LLC. 888-631-6680. It will cost at least double of what a homeowners insurance policy would be. We have a big house with an outdoor jacuzzi so it was worth it for us. She read through the policy and coverage and gave us the thumbs up. Unfortunately Erie doesn’t offer anything yet but she said they are working on it. I’m not sure about other parts of the country though. I’m sure there are others to choose from in other states.