By The Hospitable Team
Being an Airbnb host can help you earn extra income,—but what if something happens to your vacation rental property when you open it to temporary guests? It’s important to protect your property against damage and yourself against personal liability claims with the right insurance coverage.
So if you’ve decided to rent out your home on Airbnb, you might be wondering how much insurance coverage you need to protect your assets and if there is Airbnb insurance available for homeowners.
Airbnb offers protection for hosts if something happens at their property. But you shouldn’t solely rely on Airbnb if something goes wrong. In this article, we discuss what they offer, what they don’t cover, and how to protect yourself.
You may also want to check out tips on how to avoid complaints from Airbnb guests.
Airbnb Insurance: Is It Available Everywhere?
Airbnb insurance is available for free to any host on the platform. But you should keep in mind that states within the U.S. have their laws regarding home-sharing.
These laws and regulations can determine whether you qualify for protection under Airbnb Host Guarantee or Host Protection Insurance. That means you should know the legal Airbnb requirements for your local area.
Moreover, you must cooperate with your local laws and landlord or condominium board rules regarding home-sharing services to access Airbnb’s insurance services. In some cities, for example, New York, this may mean that you must comply with zoning laws and apply for commercial permits. You may also be required to pay additional taxes when you rent out your property.
If you ignore these local regulations, you may be disqualifying yourself from the benefits of Airbnb insurance and the Airbnb damage policy.
Airbnb Insurance Policy: What Is Covered?
Airbnb has its form of insurance called host protection insurance. Airbnb hosts are automatically covered by this policy, so you don’t need to do anything to register or sign up for it. There are two types of insurance for hosts: Host Guarantee and Host Protection Insurance.
With proper coverage from Airbnb’s Host Protection Insurance and their Host Guarantee, Airbnb hosts should have peace of mind that they’ll be covered in case of damage from a guest.
That means that you’ll be able to focus on providing your guests with the best experience, and that requires some time and effort. But with software tools like Hospitable, you can automate most of your processes and ensure perfect personalized communication with your guests to make them happy.
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What Does Airbnb Host Protection Cover?
Airbnb’s free Host Protection Insurance is a liability insurance program that is available to hosts globally. That means it generally applies first regardless of other insurance policies you may have.
Host Protection insurance covers injury or property damage claims made against you by guests or other third parties (for example, neighbors). It may provide up to USD 1,000,000 in liability coverage for a host’s legal responsibility when the host is sued for something that went wrong during an Airbnb stay.
Potential scenarios when you may need this insurance could be when a guest is injured during their stay, thinks you’re responsible for that and decides to take legal action against you. Or it may happen when your guest accidentally damages your neighbor’s property, and the neighbor takes action against you.
But Host Protection Insurance doesn’t cover damage or injury that results from something done intentionally (not an accident) and loss of income. It doesn’t cover damage to your property, either. This is where Airbnb’s Host Guarantee comes in.
Airbnb insurance policies protect not only hosts but guests in case anything goes awry during their stay. Accidents happen, and the host protection policy offers a buffer of insurance coverage if a guest gets hurt and decides to sue.
Airbnb Damage Policy
Host Guarantee is intended to cover damage to your place and belongings caused by guests staying on your property, up to $1 million. But unlike Host Protection Insurance, this program isn’t a form of insurance, and it has some significant limitations and exclusions.
Host Guarantee doesn’t cover cash, valuables, or pets. So if a guest stole money from you, damaged your computer, or injured your dog, it would not pay out. Besides, it doesn’t cover damage caused to shared or communal areas, for example, common entrance halls in blocks of flats.
How to Submit an Airbnb Damage Claim
If an incident happens, you have 30 days in total to complete the entire claim process. First, you must try to come to a resolution with the responsible guest. You have 14 days after your guest checks out to contact them. You also need to notify Airbnb if the guest refuses to compensate you for damages.
Then you must provide documentation of the incident to Airbnb, such as proof of ownership, as well as photos and descriptions of the damage. If you fail to adhere to any part of this timeline, you can be disqualified from receiving any reimbursement.
And if your Airbnb damage claim is successful, you may receive compensation that is equal to the actual cash value of your property.
Airbnb Homeowners Insurance
Homeowners’ insurance may also protect your property from damage related to Airbnb or other home-sharing services. But in most insurance companies, coverage often applies only if you’re renting your property just occasionally. And that term may be defined differently by different insurers. So you should talk to your insurer or review your policy to learn more.
It’s important to remember that when a company insures your home, they assume that you and your family will use it. But they don’t imagine that the space will be used for business purposes. Some insurers view renting your home out through Airbnb as “doing business” and may be unwilling to extend your standard policy to cover business-related losses.
But there are Airbnb homeowners insurance options with enough comprehensive coverage for the property that is rented out. They can further protect hosts from damages that would not be covered under normal landlord insurance or business insurance and will protect your rental income.
You may also want to add a rental agreement between you and your Airbnb guest to get additional legal protection if damage happens. And Hospitable.com will help you schedule a message triggered by a new reservation and share the rental agreement with your guests. In fact, we can automate 90% of your communication with guests.
Have conversations with your guests even when you sleep.
Protecting your short-term rental property is vitally important; that’s why Airbnb offers hosts financial protection as a part of a contract. Airbnb’s insurance policy provides primary liability insurance coverage up to $1 million for third-party bodily injury or property damage claims.
It also typically protects the hosts from damages that the guests may have caused to the home’s structure. But it doesn’t cover everything, so those who rent their places out online should still ensure they have sufficient homeowners insurance policies.
If you plan to rent your home through Airbnb, you should also consult your insurance provider. You should find out if you need a landlord or business insurance policy for your rental property to make sure you have adequate coverage.
If you are planning to rent out your property on Airbnb, you should get ready to face Airbnb complaints from guests. Vacation rental issues happen even to the best hosts, but you shouldn’t forget that these problems, big or small, may quickly turn into bad reviews. Read the article to learn how to prevent those complaints.
An Airbnb rental agreement is a legal contract between you and your guests, which sits outside of the Airbnb platform, giving you additional legal protection in any guest malpractice event.
But what should you put in the rental agreement? How do you send it to your guests? And what are the downsides?
Let’s find out, shall we!
Local governments have been cracking down on Airbnb—with many outlawing (or severely prohibiting) it altogether. It’s a bit of a challenge to find the precise requirements to starting your Airbnb business. But don’t worry; this article is going to point you in the right direction and give you all the information you need to know (and where to get it) to be compliant.