Landlord Insurance for Short-term Rentals: What You Need to Know

Operating short-term rentals, such as those listed on Airbnb, presents unique challenges and risks for landlords. Unlike traditional rental properties, short-term rentals experience higher turnover rates, a diverse range of guests, and increased wear and tear. These factors necessitate specialized insurance coverage that standard landlord insurance policies may not adequately provide.

Unique Risks of Short-term Rentals

Short-term rentals are subject to frequent guest turnover, which increases the likelihood of property damage and liability claims. Guests may not treat the property with the same care as long-term tenants, leading to more frequent repairs and maintenance. The constant flow of different guests also raises the risk of accidents and injuries on the property, which can result in costly liability claims.

Limitations of Standard Landlord Insurance

Standard landlord insurance typically covers long-term rental properties and may not account for the unique risks associated with short-term rentals. These policies often exclude coverage for business activities, which short-term rentals are considered. This exclusion means that any claims arising from short-term rental activities could be denied, leaving landlords financially vulnerable.

Specialized Insurance Solutions

To address these gaps and exposures, landlords should consider specialized insurance policies designed for short-term rentals. These policies typically offer coverage for property damage, liability and loss of income due to cancellations or other disruptions. Some insurers provide endorsements or riders that can be added to existing landlord policies to extend coverage to short-term rental activities.

Key Considerations

When selecting insurance for a short-term rental, landlords should ensure the policy covers the following:

• Property damage caused by guests
• Liability for guest injuries
• Loss of income due to cancellations
• Vandalism and theft

Additionally, landlords should verify that the policy complies with local regulations and any requirements set by the rental platform.

Learn More About Landlord Insurance

Contact Mikel's Insurance Services to discuss specialized insurance for your short-term rental.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.